Godfrey Phillips India Ltd. (GPIL) is a well-known name in the cigarette and tobacco industry of India. It has recently announced a 23% increase in consolidated net profit for the second quarter ending September 30, 2024. The company reported a net profit of₹248.31 crore, up from₹202.06 crore in the same quarter of the previous fiscal year. This growth has been increased by strong sales across core business segments that highlight the company’s flexibility and market position.
Revenue boost from core operations
The company’s consolidated revenue from operations in Q2 stood at ₹1,651.42 crore, a notable rise from ₹1,374.55 crore in the corresponding period last year. A significant part of this increase came from the company’s core segment—cigarettes, tobacco, and related products—which generated ₹1,610.06 crore in revenue compared to ₹1,258.48 crore in the same quarter last year. This growth underscores GPIL’s steady performance and a strong foothold in the tobacco industry.
Rise in expenses reflects operational expansion
Total expenses for the quarter were reported at ₹1,415.89 crore, up from ₹1,194.03 crore a year earlier. The increase in operational costs is in line with the company’s expansion and growth strategies, which have supported its ability to boost revenue and profitability despite higher expenses. This reflects GPIL’s strategic focus on sustainable growth, balancing rising operational costs with a strengthened revenue base.
Decline in retail segment revenue amid strategic exit
While the core cigarette and tobacco segment continued to perform well, GPIL’s retail and related product revenue experienced a decline in Q2, generating ₹38.79 crore compared to ₹117.26 crore in the same period last fiscal. This decrease is linked to GPIL’s planned exit from its retail business under the 24Seven brand, a strategic move the company’s board approved on April 12, 2024. The exit is subject to completion of all necessary formalities, and the company reaffirmed this decision in July after a court injunction on the move was lifted.
GPIL’s decision to streamline its business by exiting the retail division is expected to allow it to focus on its core areas of strength, enhancing profitability and market presence in its primary segments.
