ITC Q4 FY24 Results: Profit After Tax Dips by 1.3%

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Synopsis:

ITC's Q4 FY24 results show mixed performance. Gross Revenue rose by 2.0% YoY to ₹17,572 Cr, while Net Revenue increased by 1.4% to ₹16,371 Cr. Despite a slight dip in Profit After Tax by 1.3% to ₹5,020 Cr, the company remains optimistic. Key segments like Hotels and FMCG saw significant growth, with Hotel Segment revenue up 15% and FMCG revenue up 7.2%. However, challenges in the Agri Business and Paperboards segments affected overall performance. The Board recommended a total dividend of ₹13.75 per share for FY24.

5 Key Financial Highlights

ITC Q4 results show certain segments of the business witnessing growth for the quarter ending FY24. Although PAT was marginally down in the quarter, the Company is upbeat about its results as it has witnessed some expansion in the Hotels business in Q4. Here are significant financial highlights (Standalone Basis) of ITC’s Q4:

  • For Q4, Gross Revenue was at ₹17,572 Cr, up by 2.0% YoY
  • In Q4, the Net Revenue was at ₹16,371 Cr, up 1.4% YoY
  • The Profit Before Tax (Before Exceptional Items) for Q4 was at ₹6,534 Cr, up 0.2% YoY
  • The Profit After Tax in Q4 was at ₹5,020 Cr, a marginal drop of 1.3% YoY
  • EBITDA for Q4 was at ₹6,163 Cr, a decrease of 0.8% YoY

Additional ReadItc Share Price

Endurance in Operations Drives Business Growth

One of the most resilient market leaders in the Cigarettes, Hotels, and FMCG segments has delivered a healthy performance in the concluding quarter of FY24, amidst low demand for certain products. ITC Q4 results portray resilience and the Conglomerate’s successful mantra of enduring good times and bad, yet keeping the business strong. Here are the main features of ITC’s business in Q4: 

  • The ITC Board recommended a Final Dividend of ₹7.50 per share. Including the Interim Dividend of ₹6.25 per share paid on 27 February 2024, the Total Dividend for the financial year ended 31 March 2024 amounts to ₹13.75 per share.
  • The FMCG segment has performed well in Q4, despite a marked downturn in consumption. Q4 Segment Revenue was up 7.2% YoY on a high base and the Segment PBIT was up 15% YoY on a comparable basis. Staples, Biscuits, Snacks, Dairy, Homecare, and Agarbatti continue to be the drivers of growth. 
  • Some traction was witnessed in the Stationary and Education Segments.
  • The Cigarette Segment witnessed consolidation of volumes on a high base after a period of sustained growth momentum with the Q4 Net Segment Revenue and Segment PBIT up by 7.0% and 5.0% YoY, respectively.
  • The Hotels Segment has portrayed a record-high performance with Q4 Segment Revenue and PBIT up 15% and 34% YoY, respectively on a high base; the Segment EBITDA margin was up 340 bps YoY to 38.2%. Margin improvement has been led by higher RevPars, structural cost interventions,  and operating advantages. 
  • The Agri Business Segment was adversely affected by trade restrictions on agri commodities. The Company’s strategic portfolio (comprising value-added agri products) and leaf tobacco saw Revenues up 19% YoY in FY24 and 18% YoY in Q4, respectively. Geopolitical tensions and climate issues resulted in concerns regarding food security and food inflation; trade restrictions imposed by the government on agri commodities have limited business opportunities for the segment. 
  • The Paperboards, Paper and Packaging Segment remains affected by low priced Chinese supplies in international markets, as well as domestic markets like India; there was a muted domestic demand for these products, and an additional rise in the cost of wood resulting in adverse results, not to mention a high base effect.

Additional Read: ITC – An Investor’s Guide

Key Financial Metrics - Standalone Q4 (FY 2023-24) Financial Results of ITC (in ₹ Crore)

Metrics

Q4 FY24

Q4 FY23

Change %

2 Yr. CAGR

Gross Revenue 

17,572

17,224

2.0%

4.1%

Net Revenue

16,371 

16,150

1.4%

3.4%

EBITDA

6,163 

6,209

-0.8%

8.6%

Profit Before Tax (BEI)

6,534  

6,522

0.2%

9.6%

Profit After Tax

5,020

5,087

-1.3%

9.4%

ITC Q4 - Onward and Ahead

The road ahead is streaked with positivity for ITC, a Conglomerate that has always delivered on its promises to bring value to its operations and hence, its products and services. With new plants being commissioned and due to begin operations in the forthcoming FY25, ITC is prepped to sustain its leadership position in the market. A trailblazer in sustainability in its Hotel business, the Company is proud of its expanded operations in this segment. Additionally, in its Cigarette segment, the business has seen a sequential uptick with new launches in times of muted demand otherwise. Set to forge ahead with new offerings in FY25, ITC looks good in its diverse sectors of business. 

Additional Read: British American Tobacco to Divest Stake in ITC: A Multi-Billion Dollar Move

Conclusion

In FY24, ITC Q4 results in some areas of the business have been subdued as demand in consumption was muted. While the other businesses of the Conglomerate, such as Hotels, FMCG, and FMCG Cigarettes remain successful in the last quarter of Q4 FY24, the Company expects business operations to witness a boost going into FY25. This would be led by estimated improvements in macro-economic indicators, prospects of a healthy monsoon and green shoots seen in rural demand recovery after many quarters. Navigating challenges in the short term, ITC remains optimistic about its growth in FY25. 

Additional Read: Government Clarifies: No Plans to Sell SUUTI Stake in ITC

About ITC

Today, ITC is one of India’s leading private sector companies and a well-diversified conglomerate with business segments spanning Fast Moving Consumer Goods (FMCG), Hotels, Paperboards & Packaging, Agri Business, and Information Technology. The Company is widely acknowledged as one of India's most valuable business entities in its sectors. ITC has the distinction of ranking it as India's most admired company, based on a survey conducted by Fortune India, in association with Hay Group.

The country’s leading marketer in the FMCG sector, and the most evident leader in the Indian Paperboard and Packaging domain, the Company has been a pioneer in farmer empowerment via its agri-business. A trailblazer in responsible luxury, the ITC group also heads an industry of the best hotels and resorts. Additionally, one of its more recent subsidiaries, ITC Infotech, is a specialised international digital solutions service provider. With world-class Indian brands under its umbrella - think ITC Masterchef, Fiama, Classmate, Paperkraft, and more, the Company has garnered a vast consumer franchise in a brief period. The Company has been steadfast in its endeavour to encourage the government’s “Make In India'' mission.

Results for the Fourth Quarter and Full Year Ended March 31, 2024

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This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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Frequently Asked Questions

Is the result of ITC’s Q4 good?

Answer Field

In Q4 FY24, ITC has done remarkably well, with key segment revenues up (Hotel, FMCG, and Cigarettes) driving overall Revenue growth for the quarter. For Q4, Gross Revenue was at ₹17,572 Cr, up by 2.0% YoY.

Based on ITC’s Q4 results, what will the future of the Company’s business look like?

Answer Field

With the prediction of a normal monsoon and a boost in macroeconomic indicators, the future of ITC appears optimistic with new units commencing business and segments being expanded to meet growing demand.

Did ITC announce any new initiatives or launches in terms of its business in its Q4 results?

Answer Field

ITC Q4 results have proved the Company’s underlying operational excellence, and the Company’s strides to make it a world-class player in all its segments. With new hotels opened and new launches in its FMCG segment, the Company strives to make a mark. Recently, the Company has forged many collaborations to promote its products and these augur well for its branding across its key segments.

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