ITC

Q2 FY26 Summary & Strategic Outlook

Steady core performance, FMCG momentum, and long-term growth levers in place 🔹 Core Business Resilience & Leadership Moves - ITC delivered a stable performance in its core segments, with profit growth remaining encouraging despite revenue headwinds. - Key developments included the appointment of Amitabh Kant (former NITI Aayog CEO) as an independent director, and voluntary delisting from the Calcutta Stock Exchange—moves that may enhance governance and market positioning. 🔹 Operational Challenges & Margin Management - Transitory issues such as GST-related disruptions and unseasonal rains impacted consolidated sales. - However, strategic pricing, easing inflation, and tight cost controls helped improve EBITDA margins. 🔹 Cigarette Segment Performance - Operating profit remained steady due to premium mix-led growth and absence of adverse taxation. - Sequential margin expansion was limited by higher leaf tobacco costs, though overall profitability held firm. 🔹 FMCG Growth & Food-Tech Expansion - FMCG segment showed robust growth, signaling resilience in rural demand and recovery in urban consumption. - ITC is investing heavily in packaged foods, hospitality, and digital platforms to scale its food-tech vertical. - ARR crossed ₹1,100 crore in Q2, driven by brands like Yogabar, Mother Sparsh, Prasuma, Meatigo, and 24 Mantra Organic. 🔹 GST Impact & Cigarette Taxation Outlook - The proposed 40% GST on retail cigarette prices is seen as a long-term positive, promoting pricing stability and reducing tax evasion. 🔹 FMCG Expansion & TAM Growth - ITC’s FMCG portfolio (notebooks, noodles, juice, dairy) will benefit from GST rate cuts, boosting volumes. - New product launches and acquisitions will help tap into underserved segments and expand total addressable market.