ITC Ltd Q3 net up 15.03% yoy at Rs4,057cr as higher operating costs dent profit growth

4 Feb 2022 , 05:40 PM

ITC Ltd reported 30.8% yoy growth in total sales revenues for the Dec-21 quarter on consolidated basis at Rs17,108cr. On a sequential basis, the revenues were up by 24%. During the December 2021 quarter, revenues from FMCG products were up 9.25% at Rs4,100cr.

However, sales of cigarettes were up 14.3% at Rs6,959cr. Hotel revenues doubled yoy to Rs496cr while agri business sales also grew by 91% at Rs5,157cr. Paperboard sales were also up 38% at Rs2,046cr.

During the quarter, ITC acquired 16% of Mother Sparsh Baby Care. ITC also declared a dividend of Rs.5.25 per share.

For the Dec-21 quarter, the operating profits were up on a yoy basis by 18.22% at Rs5,168cr. During the quarter, the biggest boost to the EBIT came, as usual from the cigarettes business which was up 14.4% at Rs4,187cr, constituting the bulk of the EBIT of ITC still.

FMCG EBIT was flat at Rs246cr as higher cost of inputs dented the operating profits. Agri business reported 17% EBIT growth yoy at Rs348cr but with EBIT margins of about 6%, it still remains a marginal contributor to the bottom line. Cigarettes still nearly 77% of the total EBIT of ITC.

Operating margins tapered on the back of higher operating costs from 33.42% in Dec-20 quarter to 30.21% in the Dec-21 quarter. Operating margins were lower on a sequential basis too.

Net Profit after tax (PAT) for the Dec-21 quarter was up 15.03% yoy at Rs4,057cr on the back of the operating performance getting transmitted to the bottom line. However, the predominance of cigarettes in the EBIT contribution remains a challenge for ITC which has been trying to diversify hard for the last 25 years.

PAT margins tapered from 26.96% in the Dec-20 quarter to 23.71% in the Dec-21 quarter. The PAT margins were lower on a sequential basis too.

Financial highlights for Dec-21 compared yoy and sequentially

	ITC Ltd
Rs in Crore	Dec-21	Dec-20	YOY	Sep-21	QOQ
Total Income (Rs cr)	₹ 17,108	₹ 13,080	30.80%	₹ 13,797	24.00%
EBITDA (Rs cr)	₹ 5,168	₹ 4,372	18.22%	₹ 4,596	12.45%
Net Profit (Rs cr)	₹ 4,057	₹ 3,527	15.03%	₹ 3,714	9.24%
Diluted EPS (Rs)	₹ 3.29	₹ 2.87		₹ 3.02
EBITDA Margin	30.21%	33.42%		33.31%
Net Margins	23.71%	26.96%		26.92%