ITC Ltd is a diversified Indian conglomerate spanning FMCG, cigarettes, paperboards, agri-business and IT services, and this is its first full quarter under the steep cigarette tax regime that took effect February 1, 2026. The print will speak to how far cigarette net revenue and segment profit decline under the new 40% GST-plus-excise structure, and whether FMCG-Others margin and the Paperboards recovery — now boosted by the Century Pulp and Paper acquisition — hold up.
| Results date | November 02, 2026 |
|---|---|
| Quarter | Q2 FY 2026-2027 |
| Previous quarter revenue | Rs. 26,943.23 Cr (standalone, Q1 FY27) |
| Previous quarter PAT | Rs. 3,578.82 Cr (standalone, Q1 FY27) |
| Market cap | Rs. 325,203.13 Cr |
| CMP | Rs. 259.5 |
The Board of ITC Ltd will meet on Monday, November 2, 2026, to approve unaudited standalone and consolidated financial results for the quarter and six months ended September 30, 2026, along with balance sheet, cash flow statement and segment disclosures, under Regulation 29 of SEBI LODR.
The dominant question this quarter is how ITC's cigarette business performs under the February 1, 2026 tax regime — 40% GST plus a length-based excise duty of Rs. 2,050-8,500 per 1,000 sticks — after Q1 FY27 net revenue fell 25% and segment results fell 35%. Management took a further round of price increases in September 2026 across select brands such as Classic Connect and Gold Flake Super Star, consistent with its stated 'calibrated pricing' approach, and post-Q1 Reuters reporting indicated resilient cigarette volumes had eased fears of migration to illicit sticks. FMCG-Others enters the quarter with momentum — Q1 revenue up 12% (ex-Staples +16%) and PBIT up 21% — though edible-oil input costs ran 8-20% higher YoY through the window, with the September 24 customs duty cuts landing only as a Q3 tailwind. Paperboards carries two tailwinds: the minimum import price on Virgin Multi-layer Paper Board was extended to March 31, 2027, and the Rs. 3,498 Cr Century Pulp and Paper acquisition, completed August 1, 2026, adds 4.8 lakh tpa and takes ITC's paper capacity to ~1.5 mn MT with a first partial-quarter contribution. The West Asia conflict kept crude elevated through the quarter — Brent breached $100 on September 9 — sustaining the trade-disruption overhang that drove Q1 agri revenue down 17% (underlying +9%), while a monsoon deficit of 15% below LPA and emerging El Nino conditions remain monitorables for rural demand.
Cigarettes under the new tax regime: Q1 FY27 showed the sharpest impact of the February 2026 tax change.
Century Pulp and Paper integration
Paper MIP and anti-dumping duty status
FMCG-Others margin defence
Performance vs Guidance Tracking
In Q1 FY27, cigarette Net Revenue (net of excise) fell 25% while gross segment revenue rose 81% due to excise-duty inclusion, and Segment Results fell 35%. Management stated that 'Strategy, execution and outcomes tracking well in line with internal plans' with over 30 portfolio interventions implemented.
The government increased GST and Central Excise duty on cigarettes effective February 1, 2026, and excise duty is not excluded from gross revenue under Ind AS 115 — standalone expenses included excise duty of Rs. 10,035.63 Cr vs Rs. 1,309.07 Cr a year earlier, an incremental burden of Rs. 8,726.56 Cr. This inflated revenue while depressing PBT and PAT comparisons, with standalone PAT down 27.12% YoY.
ITC Infotech is acquiring 22.106% of Happiest Minds from promoter Ashok Soota entities for ~Rs. 1,330 Cr, funded via a Rights Issue, with Happiest Minds to amalgamate into ITC Infotech and its shares to be listed. The combined entity targets US$1 billion revenue by FY28 (pro-forma), with share purchase completion in 3-8 months from August 31, 2026, subject to CCI, NCLT and stock-exchange approvals.
Management has stated that the legal cigarette industry 'continues to engage with policymakers for a framework of pragmatic, equitable, non-discriminatory, evidence-based regulations and taxation policies'. It has also flagged that illicit trade causes a loss of appx. Rs. 23,000 cr p.a. to the Exchequer and accounts for about one-third of the legal industry.
Yes — FMCG-Others revenue grew from Rs. 5,964 Cr in Q2 FY26 to Rs. 6,482 Cr in Q1 FY27, up 12% YoY (ex-Staples +16%) with PBIT up 21%. Dairy, Snacks, Noodles and Frozen Snacks grew 20%+ in Q1 FY27, and the Digital-first & Organic portfolio ARR reached ~Rs. 1,500 cr.