India's ITC profit falls as cigarette tax hike weighs

India’s ITC reported a 27% fall in quarterly profit on Friday, as fresh cigarette tax hikes this year squeezed margins, while price hikes weighed on demand for pricier brands.

The consumer goods major, home to brands such as Aashirvaad flour and Bingo chips, said profit fell to 35.79 billion rupees ($375.24 million) in the first quarter ended June 30, from 49.11 billion rupees a year earlier.

The Middle East war has saddled corporations worldwide with higher costs, while cigarette makers including ITC and Godfrey Phillips, which sells Marlboro in India, face a challenge of their own due to steep tax hikes.

For British American Tobacco-backed ITC, home to brands including Gold Flake and Wills Navy Cut, total expenses soared to 228.29 billion rupees from 151.88 billion rupees during the quarter.

Overall revenue, however, climbed to 269.43 billion rupees from 210.7 billion rupees.