India’s ITC slides as second wave curbs likely to hit cigarette business

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A man talks on his mobile phone as he walks past an ITC office building in Kolkata September 4, 2012. REUTERS/Rupak De Chowdhuri

Shares of cigarettes-to-hotel conglomerate ITC Ltd (ITC.NS) 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 58.50 billion rupees ($799.10 million).

Cigarette volumes were slightly short of pre-COVID-19 levels towards the end of the year, according to analysts at Antique…

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