ITC Ltd has posted a 15.6 per cent year-on-year (y-o-y) rise in revenue from operations on a consolidated basis to ₹22,281.89 crore in the second quarter, beating the Street estimate, even as profits recorded a muted 1.8 per cent rise to ₹5,054.43 crore, slightly below expectations.

While all segments of the company reported a higher revenue, the rise in agri business was the most spectacular with a 47 per cent rise in revenue y-o-y led by leaf tobacco and value added agri products.

The company described the performance as ‘resilient’ amidst a challenging operating environment. ITC noted that subdued demand conditions, unusual heavy rains in parts of the country, high food inflation and sharp escalation in input cost (leaf, wood) were witnessed during the quarter.

Cigarette, which is the mainstay of ITC both by revenue and profit, recorded a volume growth of 3.3 per cent y-o-y, ahead of the expectation of 2.5 per cent, according to Nuvama Institutional Securities. Consequently, revenue from cigarettes rose 6.6 per cent to ₹8,877.86 crore in Q2FY25 over the same period of FY24. Profit before tax from this segment grew 4.79 per cent y-o-y to ₹5,242.29 crore.

Non-tobacco FMCG, constituting food and personal care items, reported a 5.3 per cent rise y-o-y in revenue to ₹5,585.29 crore even as PBT remained flat at ₹444.24 crore. The company cited inflationary headwinds in input cost for margin drop of 35 bps, while staples, biscuits, snacks, frozen snacks, dairy, premium soaps, homecare and agarbatti drove growth.

The soon-to-be demerged hotel segment reported a 16.9 per cent revenue growth to ₹789.16 crore, while PBT was down 12.2 per cent y-o-y to ₹116.67 crore as expenses from the newly opened Colombo property weighed on the consolidated numbers.

Buoyed by the revenue surge, the agri business reported a 24.5 per cent jump in PBT to ₹446.84 crore y-o-y. However, the drag continued to be the paper, paperboard and packaging business where PBT was down 25.4 per cent to ₹234.91 crore y-o-y even as revenues went up marginally 2.1 per cent to ₹2,114.18 crore in Q2FY25 compared with the same period of the last fiscal.

ITC said the segment remained impacted due to low priced Chinese supplies in global markets including India, soft domestic demand conditions and unprecedented surge in wood prices.