ITC Q1 Review - Weak Results With Moderate Cigarette, FMCG Growth, Margin Decline In Paper, Agri: Systematix

Systematix Research Report

ITC Ltd. delivered Q1 FY25 revenues in-line with our expectations, but operating earnings’ below our estimates.

Revenue growth of 7% YoY was driven by strong growth in agri-business (+22% YoY on a weak base) and hotels (+11% YoY), with a more moderate performance in cigarettes (+6% YoY – with est. volume +3% YoY) and FMCG (+6% YoY) businesses and persisting weakness in paperboards (-7% YoY) which saw a fifth straight quarter of decline.

ITC's Ebitda margins (operating profit margin) contracted by 250 basis points YoY to 37.0%, largely due to lower Ebit margins in paperboards (-910 bps YoY) and agri-business (-110 bps YoY). Ebitda grew 1% YoY with flat adjusted profit after tax.

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