ITC Q2 Results: Profit falls 18% to Rs 4,229 crore, revenue rises 5%

Segment profit declined 27.2% to Rs 3,813 crore from Rs 5,241 crore in the corresponding period last year, while net cigarette revenue fell 21%.The company attributed the weakness to an unprecedented increase in cigarette taxes, which continued to put pressure on legal industry volumes.Live EventsITC said it had introduced new variants and strengthened its product portfolio to protect market share and counter competition from illicit and smuggled cigarettes.

The company also reported an improvement in cigarette business performance compared with the preceding quarter.Gross revenue from cigarettes, however, surged 78.1% to Rs 15,536 crore, reflecting the impact of higher taxes included in gross sales.FMCG businessITC's non-cigarette FMCG business delivered its strongest revenue growth in 14 quarters, supported by higher sales across packaged foods, personal care and stationery products.Consolidated revenue from the FMCG-Others segment rose 19% year-on-year, marking the fourth consecutive quarter of double-digit growth.

On a like-for-like basis, revenue increased 17.3%, while growth excluding the atta business stood at 23%.Biscuits, snacks, noodles, spices, salt, frozen snacks, homecare products and notebooks recorded growth of more than 20%. Dairy and personal wash products registered growth in the high teens.The standalone FMCG-Others business reported a 15.7% increase in revenue to Rs 6,967 crore, while segment profit rose 27.8% to Rs 558 crore.The segment's EBITDA margin expanded by more than 50 basis points from both a year earlier and the preceding quarter, despite higher input costs.ITC said product mix improvements, cost management and calibrated price increases helped protect profitability.

Its digital-first and organic brands, including Yoga Bar, Prasuma, Mother Sparsh and 24 Mantra, recorded revenue growth of more than 70%, with their combined annual revenue run rate exceeding Rs 1,800 crore.Paper and Agri businessThe company's paperboards, paper and packaging business also reported a sharp recovery during the quarter.Segment revenue increased 35.9% to Rs 3,016 crore from Rs 2,220 crore last year, while profit rose 47.6% to Rs 282 crore.The growth included the contribution from the Century Pulp and Paper undertaking, whose acquisition was completed on August 1, 2026.Excluding the acquisition, paper segment revenue rose 10%, while profit increased 52%.

The segment's profit margin expanded by 320 basis points on a like-for-like basis.ITC said improving demand, stronger exports and price increases helped offset higher raw material costs. Wood prices, however, remained elevated due to lower-than-expected harvests and demand from competing industries.The agriculture business reported 12% revenue growth to Rs 4,452 crore, driven by value-added products and leaf tobacco exports.

Segment profit increased 11.2% to Rs 511 crore.The company said trade disruptions linked to the West Asia conflict and delayed customer orders continued to affect agricultural exports.(You can now subscribe to our ETMarkets WhatsApp channel)