ITC slides as second wave curbs likely to hit cigarette business

BENGALURU: Shares of cigarettes-to-hotel conglomerate ITC Ltd fell nearly 3% on Wednesday, after the company warned that lockdown restrictions could cause disruptions in its supply chain in the near future.
For fast-moving consumer goods companies (FMCG) such as ITC, selling everything from instant foods, snacks, groceries to cigarettes, supply chain is a key part of operations, allowing them to hawk their wares across the country. A hit to the supply chain would possibly dent volumes and sales.
ITC’s warning on Tuesday came as its money-making cigarette business barely staged a recovery from last year’s nationwide lockdown, with March quarter revenue rising 14% to Rs 5,850 crore ($799.10 million).
Cigarette volumes were slightly short of pre-Covid-19 levels towards the end of the year, according to analysts at Antique Stock Broking.
“ITC’s cigarette division posted a strong…

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