ITC Q1 FY27: FMCG Revenue Up 12%, Agri Down 17%, Paper Up 9%
ITC reported Q1 FY27 results with FMCG revenue up 12% YoY (ex-Staples up 16%). The Cigarettes business saw a strategic response to tax hikes. Agri Business revenue was down 17% YoY, impacted by West Asia disruptions. Paperboards, Paper & Packaging revenue increased 9% YoY with PBIT up 38%. Fresh Food Business GMV grew 90% YoY.
The results present a mixed bag of performance across ITC's diverse business segments. Growth in FMCG and Paperboards is positive, but the decline in Agri business and the strategic adjustments in Cigarettes due to tax increases, along with a consolidated PAT decrease, suggest a moderate impact on investor sentiment.
The results show mixed performance across segments. While FMCG and Paperboards showed strong growth, Agri Business faced challenges, and Cigarettes navigated tax impacts. Consolidated PAT declined, indicating a neutral overall sentiment.
ITC Limited announced its unaudited financial results for the quarter ended June 30, 2026, on July 31, 2026. The company's FMCG segment demonstrated robust performance, with overall segment revenue growing by 12% year-on-year. The 'FMCG - Others' category specifically saw revenue increase by 12% YoY (16% excluding Staples), driven by strong growth in Dairy, Snacks, Noodles, Frozen Snacks (over 20% growth), and Personal Care products (mid-teens growth). The Notebooks business also registered a strong rebound.
However, the Atta performance was tempered by transient factors including heat waves, LPG shortages, and benign wheat prices. The Digital-first and Organic portfolio sustained its high-growth trajectory, with an Annual Revenue Run Rate (ARR) of approximately ₹1,500 crore. Segment EBITDA margin for FMCG - Others improved by 55 bps YoY (excluding Sresta), despite sharp cost increases in fuel, edible oil, soap noodles, and packaging inputs due to the West Asia conflict. These were cushioned by strategic inventory covers and commodity hedges, alongside focused cost management and net revenue management initiatives.
The Cigarettes business adopted a strategic and calibrated response to an unprecedented tax increase, implementing over 30 interventions to re-architect and fortify its product portfolio. Staggered and agile pricing actions were taken to mitigate the risk of volume migration to illicit trade while protecting consumer franchise.
The Agri Business Segment's performance reflected the impact of West Asia conflict-led trade disruptions and a high base, with underlying revenue up 9% YoY after adjustments. Strong growth was observed in Value-Added Agri Products (VAAP), driven by Spices and Fruits & Vegetables. The Indian Leaf Tobacco Business was impacted by lower domestic demand and subdued global offtake. The business continued to scale up exports of Nicotine and Nicotine derivative products, turning PBIT positive in the last two quarters.
The Paperboards, Paper & Packaging segment sustained strong recovery momentum, with segment revenue up 9% YoY and segment PBIT up 38% YoY, expanding PBIT margin by 200 bps. This growth was driven by higher realisations and volume, with robust traction in value-added products, sustainable paperboards, packaging, and exports. Wood costs moderated YoY. The Packaging and Printing Business also delivered robust growth in both Flexibles and Cartons portfolios.
The Fresh Food Business continued its robust growth trajectory, with Gross Merchandise Value (GMV) growing 90% YoY and ARR crossing ₹300 crore. The full-stack platform has scaled to 75 cloud kitchens across 5 cities and is being progressively introduced across India.
On a consolidated basis, Gross Revenue increased by 27.8% YoY to ₹29,410 crore. EBITDA decreased by 24.0% YoY to ₹5,181 crore, and PAT (before exceptional items) decreased by 23.2% YoY to ₹4,103 crore. An exceptional item of ₹406 crore was recorded due to the remeasurement of the pre-existing interest in Sproutlife Foods Private Limited upon acquisition of control.
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