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ITC Q1 net jumps 16% to Rs 2,186cr
The Times of India - 30 Jul 2014

ITC, the  tobacco-to-FMCG-to-hospitality conglomerate, has maintained a healthy  bottomline in a challenging environment with a 15.6% growth in net profit in  the first quarter of 2014-15. It posted a net profit of Rs 2,186 crore from Rs  1,891 crore during the same period last year largely on the back of strong  performance of tobacco, paperboard and agri-based business. The new FMCG business reduced losses  from Rs 18.93 crore to Rs 12.09 crore in the first quarter.

However, the hotel business remained an underperformer and registered a loss of  Rs 12 crore from a profit of Rs 9 crore in the year-ago period. The net revenue  for the quarter grew by 25% to Rs 9,164 crore, driven by agri business and FMCG  segment. The first quarter profit before tax increased by 18% to Rs 3,266  crore.

In a statement, ITC said the branded packaged foods businesses  posted a healthy growth in revenues during the quarter, despite sluggish demand  conditions and a marked deceleration in industry growth rate.

"In the staples, spices and ready-to-eat foods business,  'Aashirvaad' atta sustained its high-growth trajectory consolidating its  leadership position across markets. In the bakery and confectionery foods  business, the recently launched 'Sunfeast Farmlite' range of cookies in the  health segment continues to garner increasing consumer franchise," ITC has  said.

According to the company, during the quarter, the personal care products  business has expanded its portfolio in the deodorant category with the addition  of two new variants each for men and women, taking the total number of variants  under the 'Engage' brand to 14. "Engage has garnered impressive market  standing in a relatively short span of time and continues to gain traction in  the market," ITC officials added.

Commenting on the hike in excise on tobacco, ITC said the steep increase in  excise duty on cigarettes for the third year in succession as announced in the  Union Budget 2014 along with further increase in value added tax (VAT) on cigarettes by some states during the  quarter will exert further pressure on legal industry volumes and sub-optimize  the revenue potential from the tobacco sector.

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