ITC Q3 results: Consolidated net profit rises 6.6% to Rs 5,335 crore

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ITC on Monday reported a 6.6 per cent year-on-year (Y-o-Y) rise in consolidated net profit during the October-December quarter (Q3FY24) to Rs 5,335.23 crore from Rs 5,006.65 crore.

It was led by earnings from cigarettes, fast-moving consumer goods (FMCG) (non-cigarette), hotels and lower tax expense.

Consolidated revenue from operations in Q3FY24 was at Rs 19,484.50 crore, up 2.44 per cent.

The numbers beat Street estimates — the Bloomberg consensus estimate had pegged revenue at Rs 18,034.3 crore and adjusted net income at Rs 5,137.7 crore. Sequentially, revenues were up 1.11 per cent and net profit 8.93 per cent. The current tax for the quarter, at Rs 1238.80, was lower than Q3FY23.

The company said it had reassessed its provisions relating to uncertain tax positions for earlier years based on a favourable order of the Supreme Court during the quarter.

This resulted in a credit of Rs 468.44 crore in the current tax expense for the quarter and nine months ended December 31, 2023. The board recommended an interim dividend of Rs 6.25 per share for the FY24.

ITC said amid a challenging macroeconomic and operating environment and high base effect in some operating segments, the company delivered a resilient performance during the quarter.

The cigarettes segment witnessed consolidation on a high base after a period of sustained growth momentum, the company said.

Revenue from cigarettes stood at Rs 8,295.18 crore in Q3FY24 compared to Rs 8,085.72 crore in the year-ago period. Pre-tax profit was at Rs 4,966.57 crore, a rise from Rs 4,862.33 crore a year back.

In the non-cigarettes FMCG segment, revenue stood at Rs 5,218.25 crore in Q3FY24 compared to Rs 4,848.95 crore in the year-ago period. Pre-tax profits rose to Rs 433.80 crore from Rs 351.91 crore a year ago.

The company said FMCG businesses delivered resilient performance amid a slowdown in consumer demand. Staples, dairy, beverages, fragrances, personal wash, homecare, agarbattis, Classmate notebooks and pens drove growth. 

Competitive intensity remained high in certain categories such as biscuits, snacks, noodles and popular soaps, including from local/regional players, ITC said.

The hospitality segment clocked its best quarterly performance. Revenue from the hotels segment was at Rs 872.46 crore in Q3FY24 compared to Rs 739.32 crore a year back. Pre-tax profit was at Rs 233.47 crore against Rs 149.25 crore.

On the hotel demerger, the company said the stock exchanges have given their no-objection to the scheme of arrangement.

The operating environment for agri-business remained challenging due to policy interventions of the government.

Revenue from agri business was at Rs 3,273.23 crore, lower from Rs 3,305.21 crore a year ago. Pre-tax profit of the segment was at Rs 380.66 crore compared to Rs 436.55 crore in the year-ago period.

Revenue from the paperboards, paper, and packaging segment was at Rs 2,080.91 crore in Q3FY24, lower than Rs 2,305.54 crore a year ago. Pre-tax profit was at Rs 295.22 crore in the quarter compared to Rs 606.21 crore a year back. 

ITC said the segment remains impacted by low-priced Chinese supplies in the global market. It has also been hit by muted domestic demand, unprecedented increase in domestic wood costs and high base effect.