ITC reports 7% rise in Q1FY18 net profit; cigarette biz revenue decline on q-o-q basis

ITC Ltd on Thursday announced its financial results for the quarter ended on June 30. The company reported a standalone net profit of Rs 2560.50 crore, an increase of 7.3% as against Rs 2384.67 crore during the same quarter last year.

However, the company's standalone net profit in Q1FY18 dropped by 4% on quarter-on-quarter basis, as it had posted a net profit of Rs 2669.47 crore in Q4FY17. 

The company's total revenue from operation in Q1FY18 stood at Rs 13,800.42 crore as against Rs 13253.06 crore in Q1FY17. 

The company's revenue from FMCG and Cigarettes in Q1FY18 was at Rs 8774.16 crore as against Rs 8230.60 crore in Q1FY17 and Rs 8954.94 crore in Q4FY17. The revenue from hotels in Q1FY18 was at Rs 304.89 crore as against Rs 267.36 crore in Q1FY17 and Rs 386.52 crore in Q4FY17. 

"Legal cigarette industry remained under pressure due to further increase in Excise Duty in February 2017. Revised rates of Compensation Cess announced by GST Council w.e.f. 18th July 2017 with the intent to correct anomaly in rates notified earlier has resulted in sharp escalation of tax incidence on cigarettes which is not in line with the fundamental principle of maintaining revenue neutrality under the GST regime; coupled with the increase in Excise Duty, the revised rates under the GST regime will increase the tax burden of the Cigarette Business by over 20%," the company said. 

The shares of the company closed at Rs 288.65 per piece, down 1.62% or Rs 4.75 on BSE.

ALSO READ

• Cigarette makers drop as GST Council hikes cess; ITC biggest loser
• Vote against ITC's decision to pay Yogesh Deveshwar, IiAS tells shareholders