ITC’s Q4 revenue climbs 17% on cigarette and FMCG, even as packaging pivots to tech-led value

ITC reported robust March-quarter revenue growth, primarily driven by its dominant cigarettes business, even as new taxes on tobacco products and rising geopolitical instability underscore the growing importance of its fast-moving consumer goods (FMCG) portfolio.

The Kolkata-headquartered conglomerate posted a 17% year-on-year (y-o-y) rise in revenue from operations, totalling INR 23,821 crore, and a 6% increase in profit from continuing operations to INR 5,469.74 crore. The growth was fuelled by a nearly 30% rise in cigarette sales and 15% growth in the FMCG-Others business.

While cigarette profits grew 7% to INR 5,797.30 crore, the company attributed the subdued profit growth to higher taxes imposed in February, warning that such hikes could encourage illicit trade and negatively impact the broader tobacco value chain, including farmers and small enterprises. To mitigate the effect, ITC is implementing “staggered pricing action” and leaning on its portfolio of established brands.

In contrast, the FMCG business saw profit rise by more than 1.5x to INR 525.78 crore in the fourth quarter of FY26, driven by strong performance from brands such as Aashirvaad, Sun-feast, Savlon, and Mangaldeep. Full-year consolidated revenue for FY26 was up 10.1% to INR 89,913.33 crore

Amidst the financial reporting, ITC’s Packaging and Printing Business (PPB) has been undergoing a strategic transition aimed at prioritising long-term competitiveness over pure volume expansion.

This directional shift followed Cherian K Thomas taking over as chief executive in August 2025. Under his leadership, the business has focused on creating differentiated customer value, strengthening customer partnerships, and building future-ready manufacturing capabilities.

Thomas stated that the direction increasingly centres on creating differentiated customer value rather than merely expanding output. He said, "We have been expanding technical capabilities across the board, pursuing value addition through collaboration and building stronger customer stickiness."

The PPB’s strategy is anchored on value creation, with the business intentionally moving away from opportunities that add volume without strengthening its long-term strategic positioning. Thomas noted, “We have been deliberate in stepping away from margin-dilutive opportunities, particularly those driven purely by volume without strategic alignment."

Across operations, the packaging unit is focused on efficiency, innovation, and supply-chain resilience. Capital allocation decisions are increasingly linked to capability, versatility, and evolving customer requirements, rather than solely capacity addition.

Challenges persist on the cost front, with the West Asia crisis pushing up input costs across several businesses. A weaker rupee has made imported edible oils more expensive, while rising crude oil prices have led to higher costs for materials like plastic packaging.

The company’s agri business was affected, reporting a 14.2% y-o-y drop in revenue to INR 3,166.65 crore, with profits declining more than 20% to INR 200.11 crore. ITC attributed this decline to supply chain disruptions and logistical challenges resulting from the West Asia conflict, which led to deferrals of call-offs by certain customers, alongside domestic government stock limits and export restrictions on key agri commodities.