ITC’s Q3 FY25 results reflect a mixed bag of operational challenges and strategic wins. The company’s consolidated net profit declined by 7% year-on-year to ₹4,935 crore, while revenue from operations rose 8% to ₹20,350 crore. This growth was primarily driven by strong performances in the FMCG, agri, and hotel segments, offsetting weakness in the paperboard segment due to low-priced competition. The EBITDA margin improved by 3% YoY, with a 5% growth excluding the paper segment. The hotels business saw a 15% YoY increase in revenue to ₹922 crore, and profit before tax surged 43% YoY to ₹302 crore. The board has proposed an interim dividend of ₹6.5 per share for FY25, signaling confidence in the company’s cash flow and future prospects. These results highlight ITC’s ability to navigate adverse market conditions and maintain profitability through diversification and operational efficiency.

ITC’s FMCG segment has been a key driver of growth, with revenue increasing by 12% YoY to ₹10,500 crore in Q3 FY25. The company’s focus on rural market expansion has paid off, with rural sales accounting for 45% of total FMCG revenue. ITC’s portfolio of brands, including Sunfeast, Aashirvaad, and Bingo, has gained significant traction in tier-2 and tier-3 cities, driven by aggressive marketing and distribution strategies. The company has also invested in digital platforms and e-commerce, which now contribute 15% of FMCG sales. These initiatives have helped ITC maintain a competitive edge in the FMCG sector, despite intense competition from both domestic and international players.

ITC’s performance in Q3 FY25 can be better understood by comparing it with its peers in the FMCG and tobacco sectors. The table below provides a comparison of key financial metrics for ITC, HUL, and Britannia. ITC’s revenue growth is slightly lower than HUL’s but higher than Britannia’s, while its net profit margin is comparable to both peers. The company’s EBITDA margin is also in line with industry averages, reflecting its operational efficiency.

For Indian retail investors and financial professionals, ITC presents a compelling investment opportunity, given its strong fundamentals, diversified portfolio, and strategic focus on rural market expansion. The company’s consistent dividend payouts and robust cash flow provide a cushion against market volatility. However, investors should be aware of the risks associated with rising input costs, regulatory changes, and intense competition in the FMCG and tobacco sectors. A balanced approach, combining ITC with other sector leaders, can help mitigate these risks and enhance portfolio returns.