Foods pushes ITC's other FMCG growth
Segment turnover, if annualised, larger than that of many known mid-sized firms in this category;
Business Standard - 03 Feb 2014
ITC was one consumer goods company which stood out among those declaring their third-quarter numbers in the past two weeks.
The Kolkata-based conglomerate saw its other fast moving consumer goods (FMCG, the other referring to the non-tobacco products) business, which includes personal care and foods, grow 16.6 per cent in turnover to Rs 2,078 crore. It also posted a profit after two quarters of loss.
Earnings before interest and tax, basically the cash profit, was Rs 10.4 crore for the December quarter in this segment, a bit lower than the Rs 11.8 crore in the three months ending March 2013. The fourth quarter of FY13 was the first time the other FMCG business turned profitable.
If ITC's top line for the other FMCG business is annualised, it is Rs 8,312 crore, higher than the Rs 7,005 crore in the year ended March 2013. Also, its other FMCG business is bigger than mid-tier peers such as Dabur, Emami, Colgate, Marico and Godrej Consumer, which've all reported their third quarter numbers. If their top line numbers are annualised, ITC's turnover for the other FMCG business is ahead.
Packaged foods the driverWithout question, foods has played a big part in the growth of ITC's other FMCG business. While the company does not give a quarterly break-up of revenue from segments within the category, it does at the annual level. For the year ended March 2013, of a total turnover of Rs 7,005 crore, foods alone contributed Rs 4,721 crore or 67 per cent to the other FMCG business.
The balance of Rs 2,284 crore came from segments such as personal care, stationary, agarbattis, etc, all clubbed. When compared with the previous financial year, too, it is apparent which end of the other FMCG business is growing faster. Foods grew at 27.1 per cent over FY12; while personal care, stationary, agarbattis, etc, cumulatively grew 25 per cent.
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