Marlboro India seller Godfrey Phillips's Q3 profit up 7%

Godfrey Phillips India

29/01/2024 13:26

BENGALURU, Jan 29 (Reuters) - Tobacco maker Godfrey
Phillips India  GDFR.NS  reported higher third-quarter profit on
Monday, driven by growth in its core market and easing expenses.
    The company reported a consolidated net profit of 2.12
billion rupees (~$26 mln) for the quarter ended Dec. 31, up 6.6%
from last year.
    Total revenue from operations rose 34% to 14.88 billion
rupees, with the company's core cigarettes segment registering a
growth of 37%.
    During the two quarters in FY24, Godfrey saw its cigarette
segment's revenue grow 17% and 29% each, while larger rival ITC
posted a growth of 9% and 12%.
    Godfrey Phillips manufactures and distributes
Marlboro-branded cigarettes under a licence agreement with
U.S-based Philip Morris International  PM.N . The company did
not specify how much it impacts Godfrey's revenue.
    The growth in the cigarette segment was led by the Marlboro
Compact, which is priced at 10 rupees apiece, said analysts at
Centrum Institutional Research. 
    It competes with India Kings and Mini Gold, the cheaper
options produced by ITC in a similar price range.
    Analysts also said the company's core markets - Maharashtra,
Gujarat and Rajasthan - have seen growth in demand.
    The cost of materials consumed rose 18%, tugging the total
expenses up more than 37%.
    However, its smaller retail segment, which operates
round-the-clock convenience store 24Seven and contributes 7.5%
to the revenue, accrued a loss of 158.6 million rupees compared
with a loss of 208.2 million rupees a year earlier.
    Larger rival ITC  ITC.NS  beat profit estimates, helped by
price hikes, even as revenue from its cigarettes business fell
more than 1%.
    Godfrey shares closed 1.7% higher ahead of the results.

($1 = 83.1300 Indian rupees)

 (Reporting by Ashna Teresa Britto in Bengaluru; Editing by
Varun H K and Sohini Goswami)
 ((AshnaTeresa.Britto@thomsonreuters.com;))