What Does ITC Do? Understanding ITC’s Business and the Recent Demerger

ITC Limited stands tall as one of India’s leading conglomerates, boasting a diversified portfolio that spans multiple high-growth sectors. With a rich legacy and a forward-looking vision, ITC has firmly established itself across Fast Moving Consumer Goods (FMCG), Paperboards and Packaging, Agri Business, and Information Technology. Recently, the company took a significant step by demerging its Hotels business, a move aimed at sharpening focus and unlocking value for shareholders.

ITC: A Diversified Powerhouse

ITC’s footprint covers some of the most dynamic industries in India:

• FMCG Leader: ITC is the country’s largest FMCG marketer, offering products that range from personal care and packaged foods to cigarettes and staples. Its strong brands have become household names, driving significant market share.
• Paperboards and Packaging Pioneer: ITC is the undisputed leader in India’s paperboard and packaging sector, serving a vast array of industries with sustainable packaging solutions.
• Agribusiness Innovator: Known globally for its work in farmer empowerment, ITC’s agri business model connects millions of farmers with markets, providing technology, knowledge, and assured incomes.
• IT and Services: ITC also leverages technology through its IT division, supporting both internal efficiencies and external client needs.

ITC FY25 Financial Performance Amid Challenges

Despite facing macroeconomic headwinds, ITC showcased remarkable resilience in FY25. The company reported:

• Gross Revenue: ₹73,464.55 crores from continuing operations.
• EBITDA: ₹24,024.83 crores.
• Profit Before Tax (PBT): ₹26,000.86 crores.
• Earnings Per Share (EPS): ₹16.07, showing steady growth over the previous year.

Including discontinued operations related to the Hotels business, the overall profit after tax surged to ₹35,195.61 crores, reflecting exceptional gains and strong operational execution.

Also Read: Best Tobacco Stocks in June 2025 - ITC, Godfrey Phillips & More – 5yr CAGR Basis

ITC Demerger: ITC Hotels Takes Off Independently

A landmark event in ITC’s corporate journey was the demerger of its Hotels business, effective from January 1, 2025. This strategic move saw the entire hotels division, excluding ITC Grand Central Mumbai, spun off into a newly formed entity, ITC Hotels Limited (ITCHL).

• The demerger allowed ITC to streamline its core businesses and offer specialized focus to its hospitality vertical.
• The hotels business was reported as “Discontinued Operations” in the FY25 financial statements, aligning with Indian Accounting Standards.
• Despite the transition, ITC Hotels recorded its highest ever revenue and operating profits, driven by robust growth in Revenue Per Available Room (RevPar).
• For the nine months ending December 2024, the Hotels division posted a profit before tax of ₹573 crores, surpassing the previous year’s ₹445 crores.
• Profit after tax from discontinued operations stood at ₹15,104 crores, buoyed by an exceptional gain of ₹15,163 crores.

This demerger reflects ITC’s commitment to unlocking greater shareholder value and accelerating growth in both its core FMCG and agri businesses as well as the hospitality sector independently.

Conclusion

ITC is much more than a household name; it’s a diversified conglomerate that continues to evolve, innovate, and lead in multiple sectors. From empowering farmers to delivering consumer products and now focusing its hospitality operations through a dedicated company, ITC’s journey reflects strategic foresight and robust business fundamentals. The demerger of ITC Hotels marks a new chapter, positioning both entities for accelerated growth and deeper market penetration.

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