Growth in agri-business boosts ITC net in Q4 - The Hindu Business Line
May 26, 2012
Riding on the back of higher sales in its non-cigarette FMCG and agri-business divisions, ITC Ltd posted 26 per cent growth in net profit.
Profits grew to Rs. 1,614 crore for the quarter ended March 31, 2012, compared with Rs. 1,281 crore during the same period last year.
The board has recommended a dividend of Rs. 4.50 or 450 per cent for shares of face value Re 1 each.
ITC scrip closed at Rs. 231.75, down by 0.75 per cent on the BSE on Friday.
Sequentially, profits dipped by five per cent from Rs. 1,701 crore during the third quarter ended December 31, 2011.
Growth in agri-business was driven by better realizations and higher volumes, according to a company statement.
"ITC's margins have shrunk by about 120 basis points due to inflation and high interest rate regime. Margins should pick up next quarter," said Mr. Jagannadham Thunuguntla, head of research, SMC Global Securities Ltd.
ITC strengthened its personal care portfolio through a slew of launches and extensions in soaps, shampoo and skin care categories. In branded packaged foods business. ITC was able to mitigate the cost-push through improvements in product and process efficiencies, smart sourcing and supply chain initiatives.
Despite the steep hike in taxes, cigarette business posted a robust growth in revenue. The growth was attributed to launch of value-added products. The business has also witnessed investments in production quality and technology.
The hotels business was impacted by a slowdown in domestic as well as global economy, particularly the US and Europe.
The paper boards and packaging industry were faced with steep hikes in the cost of chemicals and coal, sharp depreciation of rupees as well as curtailment in support of coal by the government.
Net profit for the year ended March 31, 2012, grew by 24 percent to Rs. 6,162 crore. Turnover grew by 17 per cent to Rs 24, 798 crore.
