ITC Ltd: ₹79,000 Cr Sales, ₹20,000 Cr Profit – Cigarettes Funding Your Bingo Chips Since 1910
1. At a Glance
ITC is that relative at every shaadi who brings cigarettes in one pocket and atta packets in the other. Founded in 1910, they’re India’s undisputed Marlboro Man—holding 80% cigarette market share—but also selling you atta (Aashirvaad), noodles (YiPPee), biscuits (Sunfeast), soaps (Fiama), and even hotel rooms where you ironically can’t smoke. In FY25, they clocked ₹79,040 Cr sales and ₹20,032 Cr PAT with a 33% OPM—basically running an FMCG-cum-sin-business monopoly. Stock at ₹406 yields a fat 3.5% dividend—so even if prices don’t move, at least ITC pays you for holding on.
2. Introduction
Let’s be honest: ITC is the corporate version of a double life. By day, it’s “the FMCG company of the future”—pushing atta, noodles, biscuits, body wash. By night, it’s still a cigarette kingpin funding everything else with one puff.
Every Indian investor has a love-hate story with ITC. Love for the dividends (52–85% payout ratios historically), hate for the stock price moving slower than Mumbai traffic at 6 pm. If you bought ITC for “multibagger growth,” you’ve basically been chain-smoking patience.
But times are shifting. Hotels have been demerged, FMCG “others” now contribute 26% revenue, and agri exports are scaling. Still, 78% of PBIT comes from cigarettes—so ITC’s diversification looks like Indian TV serials: 50 episodes of drama, but the main hero is always the cigarette.
3. Business Model (WTF Do They Even Do?)
Here’s ITC’s portfolio—like a thali where half the plate is still cigarettes:
Cigarettes (42% revenue, 78% PBIT) → Brands like Gold Flake, Classic, Navy Cut. Volumes grew 7% YoY in Q2 FY25 thanks to no new sin taxes.
Agri-Business (17%) → Leaf tobacco, spices, coffee, frozen prawns. Handles 3 MnT volumes across 22 states. Agri exports surged 47% in Q2 FY25.
Paper & Packaging (6%) → Boards, laminates, food-grade recyclable cartons. Struggling with Chinese dumping.
Hotels (4%) → 130+ properties, now demerged into ITC Hotels Ltd (listing Feb 2025). Brands: ITC, Mementos, Welcomhotel, Fortune, Storii.
IT Services (5%) → ITC Infotech + Blazeclan acquisition. Provides BFSI and consumer-tech services.
One company, five avatars—like Lord Vishnu. Except the cigarette avatar keeps paying for the rest.
4. Financials Overview
Quarterly Snapshot (₹ Cr)
Source table
Metric
Q1 FY26
Q1 FY25
Q4 FY25
YoY %
QoQ %
Revenue
21,495
17,778
18,765
+20.9%
+14.6%
EBITDA
6,816
6,545
6,519
+4.1%
+4.6%
PAT
5,244
5,177
5,013
+1.3%
+4.6%
EPS (₹)
4.19
4.08
3.94
+2.7%
+6.3%
Annualised EPS = ₹16.8 → P/E ~24.1. Margins = still juicy (33% OPM, 26% NPM). But note: Other Income (₹17,636 Cr in FY25) contributes a chunk—basically investment portfolio acting as side hustle.
Question: Would you feel comfortable if half your “PAT” came from mutual fund gains?
