ITC Q2 Results: Net Profit Rises 3% to ₹5,078 Crore; Revenue Jumps 17% YoY

ITC Ltd., the diversified conglomerate, announced its financial results for the quarter ending September 2024, with a 3% increase in net profit, reaching ₹5,078.3 crore. The company also reported a robust 17% YoY growth in revenue, reaching ₹19,327.8 crore, led by strong performances in its agri-business and hotels segments, despite facing inflationary pressures and subdued demand in certain sectors.

Quick Insights

• Revenue: ₹19,327.8 crore, up by 17% YoY.
• Net Profit: ₹5,078.3 crore, increased by 3% compared to last year.
• EPS: ₹4.08, up by 2.6% YoY.
• Segment Performance: Agri-Business and Hotels segments saw the strongest growth, while Paperboards and Packaging remained affected by input cost inflation.
• Management's Take: "Strong growth driven by agri-business and hospitality, with resilience across segments in a challenging environment."
• Stock Reaction: Shares closed 1.81% lower at ₹471.85 on the BSE, ahead of the earnings announcement.

Management Commentary

The company highlighted resilience in its FMCG segment, which grew amid high inflation and a weak demand environment. According to the management, the Hotels and Agri-Business divisions performed exceptionally well, bolstered by factors such as demand in retail, weddings, and growth in value-added agri-products. Despite inflationary pressures, the company noted strong segmental growth, attributed to effective cost control and agile innovations.

Stock Market Reaction

Following the earnings announcement, ITC share price settled at ₹471.85 on the BSE, down 1.81%. Analysts attribute this minor dip to prevailing challenges in the paperboard and FMCG segments, coupled with input cost pressures. However, the company's solid revenue growth and strong EBITDA across other divisions have maintained positive investor sentiment.

About ITC Ltd. and Upcoming Developments

ITC Ltd., headquartered in Kolkata, operates across diverse industries, from FMCG and hotels to agribusiness and information technology. In a significant development, ITC is currently in the process of demerging its hotels business into a separate entity, ITC Hotels Ltd., which was approved by shareholders with a majority vote of 99.59% in June. Additionally, the company recently consolidated its shareholding in the Oberoi and Leela hospitality chains by acquiring equity from its wholly-owned subsidiary, Russell Credit Ltd.