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ITC Q2 net rises 21.5%
The Times of India - 26 Oct 2013

ITC Ltd  has maintained a healthy bottomline in a challenging environment with a 21.5%  growth in net profit in the second quarter of 2013-14. The  tobacco-to-FMCG-to-hotel major has posted a net profit of Rs 2,230 crore  against Rs 1,836 crore in the year-ago period largely owing to strong  performance of tobacco, paperboard and agro business.
 
The new  FMCG business continues to reduce losses from Rs 30 crore to Rs 12 crore.  However, the hotel segment remained an underperformer with a fall in profit to Rs  6.72 crore from Rs 15 crore owing to economic downturn. The net revenue growth  during Q2 stood at 15.2% to Rs 7,862 crore driven by branded foods businesses,  paperboards and leaf tobacco exports.
 
According  to officials, the snack foods business recorded a strong growth during the  quarter. The potato chips range — relaunched under the ‘Yumitos’ sub-brand  earlier this year — received an encouraging response. It pointed out that in  the personal care product front the ‘Engage’ range of deodorants, launched in  April 2013, continued to garner increasing consumer franchise during the  quarter.
 
Commenting  on the lack-luster performance of the hospitality division, an official said  the hospitality sector continued to be adversely impacted by weak economic  conditions prevailing in major international source markets and India on the  one hand, and significant additions to room supplies in key cities on the  other. “While segment revenues grew by a robust 13.8% during the quarter driven  by ITC Grand Chola, which commenced operations in September 2012, profitability  was impacted by a relatively weak pricing scenario prevailing in the industry  and gestation costs of the new property,” officials added.
 
The  paperboards, paper and packaging segment recorded a growth of 11.7% in revenues  during the quarter driven by a strong growth in paperboards and flexible  packaging. Segment results for the quarter were, however, impacted by the steep  rise in input costs — particularly of wood and coal.