MUMBAI (Reuters) - India's biggest tobacco maker, ITC Ltd., on Wednesday reported a 34 percent rise in its quarterly earnings, boosted by strong sales of cigarettes and growth across other businesses including hotels and food.
Shares in ITC, in which British American Tobacco Plc holds 31.7 percent, rose 2.5 percent to 176.75 rupees in a flat market.
The Kolkata-based firm, which also has interests in paperboard, agriculture and retail, said net profit for the October-December quarter was 7.17 billion rupees ($162 million), up from 5.37 billion rupees a year earlier.
Its net sales rose 24 percent to 31.66 billion from 25.56 billion a year earlier.
That beat a Reuters poll forecast for a net profit of 6.95 billion rupees on net sales of 31.15 billion.
Its full-year profit is expected to rise 22 percent to 27.51 billion, according to Reuters Estimates.
ITC recently entered the personal care segment and has opened grocery stores.
But cigarettes make up nearly two-thirds of its revenue and ITC has raised prices of several brands ahead of an anticipated value-added tax on cigarettes in the federal budget on Feb. 28.
ITC shares, valued at $14.7 billion, lost 6.2 percent in the Oct-Dec quarter, beating a 6.4 percent loss for the sector index, but trailing a 10.7 percent gain for the BSE main index.
Higher cigarette prices may help offset the threat to margins from a higher share of revenue from its non-cigarette businesses including packaged food, analysts said.
ITC, with its expanded consumer goods interests and retail foray, will compete more directly with top consumer goods maker Hindustan Lever Ltd., which is due to report full-year earnings on Feb. 20.
Cost of raw materials consumed in the December quarter rose 37 percent.
Revenue from cigarettes rose 14 percent, while revenue from its other consumer goods businesses rose 67 percent. Revenue from its agriculture-based business climbed by a fifth and revenue from hotels gained 29 percent on the year.
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