Diversified conglomerate ITC Ltd reported a sharp spike in net profit for the March quarter (Q4 FY25), powered by an exceptional gain from the demerger of its hotels business. Consolidated profit rose nearly 4x year-on-year to ₹19727.37 crore, compared to ₹4934.80 crore in the same period last year.
While the headline number was boosted by one-time gains, ITC's underlying performance remained steady across key verticals despite a subdued demand environment and cost pressures. The board also recommended a final dividend of ₹7.85 per share, taking the total dividend for FY25 to ₹14.35 per share.
Table of Contents:
Here’s how ITC performed in the fourth quarter, with or without exceptional gain:
Key Financial Metrics ( Consolidated, Y-o-Y ) :
- Net profit: ₹19727.37 crore (vs ₹4934.80 crore in Q4 FY24)
- Includes: ₹15129 crore from discontinued operations (Hotel business demerger)
- Adjusted profit from continuing operations: ₹5155.27 crore
- Revenue from Operations: ₹2037636 crore up 9.8% Y-o-Y from ₹18561.59 crore.
- EBITDA(Standalone): ₹5986 crore up 2.5% Y-o-Y.
/content-assets/1da9656a24ef4ccdaf0536e6552a4f8f.png)
Dividend Declared :
The company has announced a final dividend of ₹7.85 per share for FY25. Including the interim dividend declared in February 2025, the total dividend for the financial year stands at ₹14.35 per share.
|
Particulars
|
Dividend (₹ per share)
|
|
Final Dividend (FY25)
|
7.85
|
|
Interim Dividend Feb 2025)
|
6.5
|
The dramatic rise in quarterly profit was largely due to a one-time gain from the demerger of ITC’s hotels business:
Demerger of Hotels Segment:
- ITC's hotels arm was demerged into ITC Hotels Limited effective 1 January 2025.
- The move led to a gain of ₹15129 crore, reported under “profit from discontinued operations".
- The demerger excluded ITC Grand Central, Mumbai, which remains with the parent company.
Subdued Demand Conditions:
- Adjusted profit growth (excluding the exceptional item) was modest - only 0.8% Y-o-Y, highlighting muted volume growth in core segments amid inflationary pressures and soft consumption in urban markets.
Despite headwinds, several of ITC’s business segments showed resilience.
FMCG – Others:
- Revenue: ₹5503.33 crore
- Performance remained stable but margins were squeezed due to higher input costs (edible oils, wheat, cocoa, etc.)
FMCG – Cigarettes:
- Revenue: ₹9228.66 crore (up from ₹8688.92 crore in Q4 FY24)
- Margins held steady despite rising leaf tobacco costs, thanks to pricing discipline and mix improvement.
Agri Business:
- Revenue: ₹3694.64 crore
- Strong growth led by tobacco exports, rice, and value-added agri products.
- Nicotine and derivatives exports started in Q4 from a new facility; scale-up expected in FY26.
Paperboards, Paper & Packaging:
- Revenue: ₹2188.69 crore
- Pressured by cheap imports (especially from China & Indonesia), soft demand, and high wood prices.
Want to understand the future of digital finance and how it could impact your investment strategy? Watch this insightful video to get expert insights into the evolving world of finance and technology.
Want to learn how to analyze FMCG stocks like ITC and HUL? Watch this quick video guide!
The company described its overall FY25 performance as “resilient”, especially in light of rising input costs and a challenging consumption environment.
Management Highlights :
- Inflation and stagnant wages have weighed on household savings and FMCG demand.
- Urban consumption was particularly weak, but a rural rebound is expected with a good monsoon and easing inflation.
- The union budget’s tax cuts are also expected to boost consumer spending in FY26.
While ITC’s reported profit far exceeded expectations due to the one-time gain, analysts focused on the core business, which showed only marginal growth.
Analyst Estimates: Net Profit was expected at ₹4906 crore, actual (ex gain): ₹5155 crore.
Revenue Beat: ₹20376 crore actual Vs ₹17371 crore expected.
/content-assets/7627f77ffbc34313b95b72e28268aa4c.png)
Despite the softness in volumes, analysts viewed the results as stable given the external pressures.
The demerger sets the stage for a more focused growth strategy across ITC’s verticals. Key factors to watch in FY26 :
Near-Term Challenges :
- Continued input cost volatility
- Sluggish consumption trends in urban areas
- Pricing power limitations in some FMCG categories
Long Term Drivers :
- Rebound in rural consumptions
- Increased nicotine exports
- Growth in value added agri and premium cigarette categories
- Strategic shift post-hotel demerger allows leaner focus on core operations
ITC’s Q4FY25 results were headline-grabbing, thanks to the ₹15000+ crore windfall from its hotel business demerger. But beyond the exceptional gain the company demonstrated resilience in a tough macro environment, especially in its FMCG and agri segments.
As consumption conditions improve and supply-side pressures ease, ITC appears well-positioned to accelerate, with a sharpened strategy, strong cash flows, and diversified revenue base. The market will be watching closely to see if the post-demerger ITC can deliver stronger organic growth in FY26 and beyond.
1️. Why did ITC report a sharp jump in profit in Q4 FY25?
ITC posted a sharp rise in its Q4 FY25 profit due to a one-time exceptional gain of ₹15,129 crore from the demerger of its hotel business. Without this, its core profit growth was modest, reflecting subdued demand and inflationary pressure.
2️. What is the total dividend declared by ITC for FY25?
ITC declared a final dividend of ₹7.85 per share in Q4 FY25. Including the interim dividend announced earlier in February 2025, the total dividend payout for FY25 stands at ₹14.35 per share.
3️. How much was ITC’s adjusted net profit in Q4 FY25 excluding the hotel demerger gain?
Excluding the exceptional gain from the hotel business demerger, ITC’s adjusted net profit from continuing operations was ₹5,155.27 crore in Q4 FY25 - a marginal 0.8% increase compared to the previous year.
4️. Which business segments drove ITC’s performance in Q4 FY25?
Key growth drivers for ITC in Q4 FY25 included:
-
Cigarettes business revenue up to ₹9,228.66 crore with steady margins.
-
Agri business revenue at ₹3,694.64 crore, boosted by tobacco exports and new nicotine exports.
-
FMCG - Others remained stable despite margin pressure due to higher raw material costs.
5. What are the growth prospects for ITC in FY26 after the hotel demerger?
Post-demerger, ITC is expected to benefit from:
-
Rural demand recovery supported by a good monsoon
-
Increased nicotine and agri exports
-
Premiumisation in cigarette and FMCG categories
-
Focused growth strategy in core businesses
6. Is ITC’s FMCG business facing challenges in Q4 FY25?
Yes, ITC’s FMCG (excluding cigarettes) business faced margin pressures in Q4 FY25 due to high input costs for edible oils, wheat, and cocoa. However, the company expects easing inflation and higher rural demand to aid recovery in FY26.