Shares of ITC were trading 1% lower ahead of its second-quarter earnings on Thursday.

What Happened: Axis Securities expects a 7.4% growth in the company’s revenue, backed by a 6% growth in cigarette business, a 7% growth in fast-moving consumer goods (FMCG) vertical and a 10% increase in its hotels business.

The brokerage sees the agricultural vertical growing by 15% and the papers business declining. Net profit is expected to grow by 1.2% year on year whereas EBITDA margin is expected to decline on account of subdued performance in the paper board business.

Kotak Institutional Equities sees the company’s revenue growing by a similar margin but sees net profit increasing 3% year on year. The brokerage estimates cigarette volume growth at about 3%, which is expected to translate into a 7% increase in net cigarette sales.

In the FMCG segment, Kotak projects a revenue growth of 6.5%. In the hotel business, it expects a growth of about 10%. The agribusiness is expected to grow 15%. Conversely, paperboard growth is projected to decline by 4%.

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Yes Securities estimates the company’s overall topline to grow by 8.1% and profit to rise 6.5% compared to the year-ago period. Revenue growth is expected to be backed by about 3% volume growth in the cigarette business.

The brokerage estimates the FMCG business, hotels and agri business will grow at 8%,13% and 15%, respectively. the research firm sees gross margin and EBITDA margin going to 57.5% and 36.9%, respectively.

HDFC Institutional Research expects ITC’s net sales to soar by 8% while profit is likely to see a 2.7% increase. It sees a low single-digit cigarette volume growth owing to increased competitive intensity. The EBITDA margin is expected to stay flat because of inflationary pressures on the raw material costs in the cigarette business, HDFC added.

Antique Stock Broking sees sales increasing by 7.5%, driven by hotels and agri business and profit going up 1.9%. According to Antique, cigarette revenue is expected to grow by 5.5%.

The FMCG business is projected to see 6% growth, while the hotels business is likely to experience a strong 12% revenue increase. The agribusiness is expected to report an impressive 22% revenue growth, although profitability may be affected by rising commodity prices. Paper performance is expected to be weaker.

On average, analysts see the company reporting a revenue of ₹17,754 crore and a net profit of ₹5,078 crore.

Price Action: ITC was down 1.35% to ₹473.85 on Thursday morning.

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