ITC, the second largest FMCG company in terms of market capitalization, is expected to provide healthy growth in FMCG supported by a strong product portfolio and hotel segment with higher mobility, while cigarette volume can return to pre-covid levels in the quarter ending December 2021 on the bottom of last year. The company will release the income score card on February 3.
In the past few days, stocks have risen by almost 10 percent, some are supported by no change in taxes on tobacco and cigrette in the Union budget, but since the beginning of October 2021, it has corrected almost 2 percent.
Overall, analysts mostly expect 6-8 percent and flat revenue growth of up to 5 percent year-on-year earnings compared to last year’s period. Cigarette volume growth can be in the range of 8-10 percent and the FMCG segment can produce around 9-12 percent yoy growth.
The cigarette business contributed nearly 40 percent and the FMCG contributed 27 percent to total revenue in the September 2021.
“Cigarette business income is expected to increase by 9-10 percent with the expected volume to reach 100 percent pre-covid level. The non-cigarette FMCG business is expected to grow by 9 percent, assisted by a strong product portfolio. The hotel business is expected to provide strong growth Because of higher mobility, “Shatkhan said who saw a 3 percent growth in adjustable profits and 8 percent in revenue for the December 2021 quarter.
Remember the volume of cigarettes fell 8 percent yoy on thousand December 2020 dents by the Covid crisis. But overall the company has increased its focus on the FMCG segment which is cigarette, which has gradually reflected in the amount.
Institutional Equity Box hopes that the growth of 9 percent yoy in the volume of cigarettes and the growth of 10.5 percent yoy in the sale of cigarettes is assisted with a mixture of 1.5 percent. “We estimate the growth of 11.4 percent yoy in Ebit cigarettes.”
In the FMCG segment, “We estimate 12 percent of YoY’s revenue growth assisted by the acquisition of sunrise (up 7 percent of the growth of the former organic income of the former sunrise),” said the box which saw 6.6 percent of income growth and 4.5 percent profit growth for Q3FY22.
ITC has completed the acquisition of sunrise, spice manufacturers, in July 2020, for Rs 2,150 Crore.
Among other business segments, the Agri & Carton business is likely to witness sales growth of 16.5 percent & 23.3 percent, said ICICI Direct which estimates the hotel business to register revenue growth of 41.3 percent with normalization of negotiations to the pre-covid level. However, Arrs (the average room rate) is still below the pre-covid level.
