In the past two months ITC's stock price has corrected by close to 10% and the stock has underperformed the broader market (the Sensex has risen by 6% and the BSE FMCG Index has marginally dropped by 4% in the same period).
ITC reported Adj PAT of Rs21bn on the back of 15.9% EBIT growth in Cigarettes even as Hotels and Paperboard businesses disappointed, resulting in Non‐cigarette business EBIT decline of 5% YoY, mainly led by 58% decline in losses in the FMCG
ITC's Q2FY2014 performance was disappointing in terms of the revenue growth in some of the key businesses (cigarette and agri) moderating the overall top line growth to high single-digits during the quarter.
Diversified conglomerate ITC has reported its second quarter net profit at Rs 2,230 crore as against Rs 1,836 crore in the same period last year, up 21.5 per cent.Gross sales grew almost nine per cent, to Rs 7,776 crore.
The net earnings of Sharekhan’s banking universe are likely to decline by 12% year on year (YoY), largely contributed by the public sector undertaking (PSU) banks which are expected to report a decline of 26% YoY in their net earnings.
It is said that ITC can notch up around 5 per cent of market share for any product it debuts by dint of its distribution. It is present in categories such as personal care and food as are other FMCG behemoths like HUL.
Smartphone and tablet manufacturers have an interesting source for bulk orders these days: fast moving consumer goods (FMCG) majors and healthcare/pharmaceutical companies with widespread retail channel networks.
ITC hiked prices of select cigarette brands (Gold Flake Kings, Gold Flake Lights and Classic) by over 10.3% on Monday. This follows a 7% hike announced in July 2013, both of which were taken to offset increase in duties.