Business & FinanceTop StoryTop StoryLatest News
ITC's Q2 Net Profit Declines 18.7% as Higher Cigarette Taxes Hit Earnings
Sentiment: NeutralHigh Priority
What Happened?
ITC reported an 18.7% year-on-year drop in net profit to ₹4,168.40 crore for Q2FY27, primarily due to increased cigarette taxes. Consolidated net revenue rose 3.9% to ₹20,269 crore.
Key points
- ITC's net profit for Q2FY27 was ₹4,168.40 crore, down from ₹5,126.11 crore a year earlier.
- Consolidated net revenue increased by 3.9% year-on-year to ₹20,269 crore.
- The cigarette segment's pre-tax profit fell 26% year-on-year to ₹4,044.49 crore.
- The non-cigarette FMCG segment saw a 19.1% revenue increase to ₹7,218.36 crore.
- The agri business recorded revenue of ₹4,550.60 crore, up 12.7% year-on-year.
Key insights
- The increase in cigarette taxes could lead to a further decline in legal industry volumes.
- ITC's strong performance in non-cigarette FMCG may help offset losses in the cigarette segment.
- Geopolitical and climatic factors may pose risks to agricultural output and inflation.
Why it matters
The decline in ITC's net profit highlights the impact of increased taxation on the cigarette industry.
Entities
ITC· CompanyIndia· Country
Source
Business Standard
