ITC profit up 10.4% at Rs2,500 cr in Q2

Diversified conglomerate ITC Ltd reported a net profit of Rs 2,500 crore for fiscal second quarter  (July-September 2016-17) - an over 10.4 per cent jump from the Rs2,263 crore profit earned in the corresponding quarter of the previous fiscal.

ITC said the rise in profit followed an across-the-board rise in revenues from all its verticals, including the cigarette business, but excluding losses in the non-cigarette FMCG category.

Kolkata-based ITS said its total income from operations during July-September 2016-17 grew 8 per cent to Rs13,617 crore against Rs12,611 crore in the year-ago quarter.

And, despite the ''regressive'' tobacco packaging rules, cigarettes continue to drive revenue and profit (before tax) for the company.

Nearly 63 per cent of total revenue from operations and 84 per cent of profit came from the segment.

Cigarette revenues grew 7 per cent in Q2 FY-17 to Rs8,528 crore against Rs7,963 crore year-on-year while profit before tax grew by 8.3 per cent to Rs3,217 crore (Rs2,969 crore).

''The performance of the cigarette business during the quarter remained subdued on account of continued pressure on the legal cigarette industry in India,'' ITC said in a statement.

The non-cigarette FMCG business saw an over 13 per cent Y-o-Y growth in revenues to Rs2,672 crore.

The company was able to pare down losses to Rs3.26 crore in Q2 of FY-17 from Rs11.10 crore in Q2 of FY-16.

According to a statement by ITC, the FMCG-Others segment saw its revenue move up ''amidst a persistently sluggish demand environment''.

The company further claimed that its brand of luxury chocolates under 'Fabelle' was ''well received'' and the 'Fabelle Chocolate Boutique' extended to ITC Maurya (New Delhi), ITC Sonar (Kolkata) and ITC Grand Chola (Chennai) during the quarter in addition to ITC Gardenia (Bengaluru).

Revenues from hotels and agri-business saw a marginal 2 per cent increase on a y-o-y basis to Rs297 crore and Rs1,880 crore, respectively.

In terms of performance, the hotel segment was back in black with a profit (before tax) of Rs65 lakh against as Rs6 crore loss in the comparable quarter of the previous fiscal.

Revenues across the paper, paperboards and packaging segment remained flat at Rs1,331 crore.

''Paperboards, paper and packaging segment revenue impacted by subdued demand in FMCG & legal cigarette industry, zero duty imports under Free Trade Agreement with ASEAN countries and cheap imports from China,'' the company said in a statement.