ITC Q1 Preview: Cigarette volumes to grow, profit likely to rise in high-single digits

Analysts will closely monitor demand in metro areas compared to the rural outlook, along with the competitive intensity.

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26 Aug, 2025 12:21

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Diversified hotels-to-cigarettes conglomerate ITC will report its earnings for the first quarter of the current fiscal year on August 1, 2024. The FMCG player is likely to report the highest revenue of all its listed peers.

According to a Moneycontrol poll of seven brokerages, ITC is likely to report revenue at Rs 17,171 crore, rising 8.5 percent on-year compared to Rs 15,828 crore in the June quarter of FY24.

Net profit is likely to come in at Rs 5,137 crore from Rs 4,903 crore from the corresponding quarter last year, higher by 4.8 percent.

Earnings estimates of analysts polled by Moneycontrol are in a narrow range, so any positive or negative surprises may elicit a sharp reaction in the stock. The most optimistic estimate sees ITC’s net profit jumping over 10 percent on-year.

What factors are impacting the earnings?

ITC’s FMCG and hotels segments are expected to perform well, but agri and paper arms will be a drag, noted brokerages.

Cigarette volumes: The Budget 2024 contained no changes in tobacco taxation, which is seen as largely good news by the industry as it will not impact volume growth in the upcoming quarters.

However, for the quarter ended June, cigarette revenues are expected to grow between seven to nine percent, while seeing a two to four percent volume growth during the quarter.

Segmental performance: The FMCG segment is expected to grow around seven percent, while ITC Hotels will clock growth of about eight percent on-year. The paperboard business will decline, while agri business is supposed to record flat growth.

Rural demand: Rural recovery is not very visible in Q1FY25 but the government initiatives should drive consumption, said Motilal Oswal.

What to look out for in the quarterly show?

Analysts will closely monitor demand in metro areas compared to the rural outlook, along with the competitive intensity. Additionally, the Street will be closely watching for any word on the Hotels business spin-off, along with the agribusiness outlook.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.