(Reuters) -India’s ITC Ltd reported a better-than-expected profit in the first quarter on Monday as it kept a tight lid on expenses and saw strong demand for consumer goods in its urban and rural markets.
Net profit at the cigarettes-to-hotels conglomerate rose 17.6% to 49.03 billion rupees ($590.28 million) in the three months ended June 30 from 41.69 billion a year earlier.
Analysts, on average, expected a profit of 48.29 billion rupees, according to Refinitiv IBES data.
Revenue from operations fell more than 7% to 169.95 billion rupees despite a boost from its consumer goods and cigarettes arms as restrictions imposed on wheat and rice exports led to a 24% fall in the agricultural business.
Sales in the fast-moving consumer goods segment, which houses brands like Aashirvaad, Bingo and Yippie, rose more than 16%, while total expenses fell by 14.7%.
Revenue from the hotels business, which got the ITC board’s nod for demerger into a separate company earlier in the day, saw a more than 8% jump with a revival in domestic tourism and more corporate bookings. ITC Hotels, which will operate as an independent entity, is expected to be listed in about 15 months. Each shareholder will get one share of ITC Hotels for every 10 shares held in the parent company.
ITC’s peer Dabur India had also highlighted a recovery in rural demand.
($1 = 83.0620 Indian rupees)
(Reporting by Ashna Teresa Britto; Editing by Sohini Goswami)