Cigarette Business Boosts ITC Performance

Higher cigarettes sales boosted ITC’s overall revenue from operations 7.2 percent to INR182.20 billion ($2.17 billion).

Net cigarette segment revenue grew 7 percent and segment profit before interest and tax was up 6.5 percent year on year.

In a statement, ITC said it fortified its product portfolio through “innovation and democratizing premiumization across segments backed by superior on-ground execution.”

The company reported strong performance in its differentiated variants and premium segment and  sequential improvement in its value segment.

It said it mitigated the sharp escalation in costs of leaf tobacco and certain other inputs through improved mix, strategic cost management and calibrated pricing.

The company attributed the strong performance of its cigarette business in part to the India’s stable tax environment.

“ s seen in the past, stability in taxes on cigarettes, backed by deterrent actions by enforcement agencies, enables volume recovery for the legal cigarette industry from illicit trade leading to higher demand for Indian tobaccos and bolstering revenue to the exchequer from the tobacco sector,”  the company wrote.