ITC Witnesses Growth In Q1FY14

FMCG major ITC recently came out with a decent set of numbers for the first quarter of FY14. The bottomline of the company witnessed growth of 18% on a YoY basis to stand at Rs 1891 crore for Q1FY14. This is in line with the street expectation of Rs 1885-1890 crore. The topline of the company witnessed growth of 10% on a YoY basis to stand at Rs 7339 crore for Q1FY14 as against Rs 6706 crore witnessed during the same period of the last fiscal.

On the operational front, the EBITDA stood at Rs 2791 crore for this quarter as against Rs 2375 crore, witnessing a gain of 17.52%. The EBITDA margins came in at 37.1%, witnessing an upmove of 225 basis points on a YoY basis. One of the reasons for such an improvement was the company's ability to contain its raw material consumption to 29.52% of the total income for Q1FY14 as against 30.83% witnessed during Q1FY13.

The company has also seen growth of 20% on the other income front on a YoY basis to stand at Rs 203 crore. The rise at the operating levels can be attributed to better margins witnessed in the cigarettes business.

On the segmental front, the cigarette business sales of the company witnessed gains of 7% to stand at Rs 3537 crore in the quarter, while other FMCG net sales grew by 18% to Rs 1745 crore. The profit from the cigarettes business rose by 18% to Rs 2242 crore. However, the other FMCG business, which had turned profitable in the Jan-March quarter, once again went into red in this quarter, witnessing a loss of Rs 19 crore. The hotel business sales gained 8% to Rs 250 crore, while profits slumped drastically by 66% to a mere Rs 9 crore.

On the agri-business front, sales rose by 29% to Rs 2189 crore and sales from paperboards, paper and packaging business were up by 10% to Rs 1163.14. Profits from the agri-business gained 16% to Rs 199 crore. But paperboards, paper and packaging business profit was down by 5% to Rs 252 crore.

The stock has witnessed a decline of 4.44% on the BSE in today's trade to close at Rs 359.30.