ITC Ltd reported 25.47% rise in the Sep-20 quarter top line sales revenues at Rs13,147.81cr. The FMCG business across the country managed to hold steady in the midst of the pandemic. The mainstay cigarette business was hit by the ban on sale of loose cigarettes but the fall in sales was hardly too steep to worry about.
For the Sep-20 quarter, the operating profits were up 58.17% at Rs3,996.40cr. This is largely on the back of higher sales absorbing fixed costs better as well as managing the working capital more efficiently. This resulted in the operating margin or OPM expanding from 24.11% to 30.40% in the Sep-20 quarter.
Net profits for the Sep-20 quarter as measured by PAT were up 33.17% at Rs3,418.69cr. The operating cost advantage got carried forward to the bottom but the impact reduced because of higher taxes and lower other income in Sep-20 quarter compred to Sep-19 quarter. This led to the net margins expanding by just 150 bps at 26% in Q2.
Financial highlights for Sep-20 compared yoy and sequentially
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|
ITC Ltd |
|
|
|
|
|
Rs in Crore |
Sep-20 |
Sep-19 |
YOY |
Jun-20 |
QOQ |
|
Revenues |
13,147.81 |
10,478.46 |
25.47% |
12,867.39 |
2.18% |
|
Operating Profit |
3,996.40 |
2,526.57 |
58.17% |
4,426.22 |
-9.71% |
|
Net Profits |
3,418.69 |
2,567.07 |
33.17% |
4,173.72 |
-18.09% |
|
|
|
|
|
|
|
|
Diluted EPS (Rs) |
2.74 |
2.04 |
|
3.34 |
|
|
OPM |
30.40% |
24.11% |
|
34.40% |
|
|
Net Margins |
26.00% |
24.50% |
|
32.44% |
|
Key takeaways from the Sep-20 quarter results
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In terms of overall revenues of ITC, cigarettes accounted for 38%, FMCG at 27%, agri-business at 21% and paperboards at 10%. The balance sales were accounted for by hotels and other lines of businesses. However, cigarettes still account for 81% of the total profits of ITC, showing how concentrated its profitability is.
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