CHENNAI/BENGALURU (Reuters) -India’s ITC beat analysts’ estimates for third-quarter profit on Monday as the consumer goods giant benefited from higher demand for its cigarettes, which make up a large percentage of its revenue.
The company’s profit rose 10.8%, to 55.72 billion Indian rupees ($670.3 million), in the three months ended Dec.
31, from a year earlier.
Analysts on average had expected a profit of 51.48 billion rupees, according to data from LSEG.
The company and its peers have benefited as a crackdown on the smuggling of international cigarette brands reduced competition.
Cigarettes account for more than 40% of ITC’s top line.
Revenue from operations rose 2%, to 176.65 billion rupees, with the cigarettes business growing 3.6%.
ITC’s hotels business, which is set to demerge into a separate entity, reported an 18% jump in revenue in the quarter, on the back of a strong revival in domestic tourism and heightened demand from corporate bookings.
Meanwhile, its paperboards, paper and packaging business was hit by competition from cheaper Chinese brands, with international sales also slowing down due to sluggish economic conditions.
The segment’s revenue declined almost 10%.
Smaller rival and Marlboro India seller Godfrey Phillips India reported a third-quarter profit climb earlier in the day.
($1 = 83.1290 Indian rupees)
(Reporting by Praveen Paramasivam in Chennai and Varun Vyas in Bengaluru; Editing by Sonia Cheema and Pooja Desai)
