ITC’s Q4 net profit falls despitehigher cigarette sales

ITC’s Q4 net profit falls despitehigher cigarette sales

Shares of cigarettes-to-hotel conglomerate ITC Ltd fell nearly 3% on Wednesday, after the company warned that lockdown restrictions could cause disruptions in its supply chain in the near future.
For fast-moving consumer goods companies (FMCG) such as ITC, selling everything from instant foods, snacks, groceries to cigarettes, supply chain is a key part of operations, allowing them to hawk their wares across the country. A hit to the supply chain would possibly dent volumes and sales.
ITC’s warning on Tuesday came as its money-making cigarette business barely staged a recovery from last year’s nationwide lockdown, with March quarter revenue rising 14% to Rs 5,850 crore. Cigarette volumes towards end-FY2021 nearly touched pre-Covid levels.

ITC’s net profit in January-March quarter fell 1.28% on-year to Rs 3,748 crore.
FMCG business reported a growth of 16% from the previous year with revenues clocking Rs 3,687 crore.
ITC’s hotel’s segment saw recovery from the previous quarter, but the performance was down 38% on-year. Revenue stood at Rs 287 crore.
The agricultural business segment saw revenue growth of 79% at Rs 3,368 crore.
A record surge in coronavirus infections in April and May drove many Indian states to reintroduce limited lockdowns.
ITC also announced a final dividend of Rs 5.75 per share, taking the total dividend for the full fiscal year to Rs 10.75 per share.

Disclaimer –
This document is meant for the recipient only for use as intended and not for circulation. This document should not be reproduced or copied or made available to others. The information contained herein is from the public domain or sources believed to be reliable. While reasonable care has been taken to ensure that information given is at the time believed to be fair and correct and opinions based thereupon are reasonable, due to the very nature of research it cannot be warranted or represented that it is accurate or complete and it should not be relied upon as such. Also above note is not a recommendation to Buy or SELL and is only a view based on facts and figures and we will be in no way responsible for any losses incurred by anyone who uses this information to either trade or invests securities mentioned herein.