Indian cigarettes-to-hotels giant ITC said its branded packaged food businesses were able to grow market share in its second quarter, despite a “sluggish consumer demand environment”.

“The branded packaged foods businesses recorded further improvement in market standing during the quarter growing well ahead of the industry across most categories,” the company noted in its results for the quarter to 30 September.

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In staples, spices and ready-to-eat foods, the group said “robust” growth was driven by the launch of premium variants and the Select brand.

ITC’s bakery and confectionery business launched a range of premium cookies – Sunfeast Mom’s Magic – and entered the chewing gum segment with a new range called GumOn, which was rolled out to “select markets”. “The products have met with favourable consumer response and are being rolled out to target markets,” ITC revealed.

Meanwhile, in snacks, new Bingo chips gained “good traction”, while in noodles and pasta, ITC said its Sunfeast Yippee brand sustained its “high growth trajectory” and “enhanced market standing”.

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Total second-quarter FMCG sales, excluding cigarettes but including personal care, rose to INR219.6bn (US$3.57bn), up from INR196.2bn in the comparable period of last year. On a group-wide basis the firm booked a 14.8% rise in net revenue, which rose to INR893bn.  

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Pre-tax group profit totalled INR358.3bn, compared to INR323.3bn in the second quarter of last year.

However, while ITC was upbeat on the performance of its food interests, Prabhudas Lilladher analyst Amnish Aggarwal stressed the majority of earnings growth was generated by the group’s cigarette business.

“ITC reported adjusted PAT of INR24.2bn mainly due to 19.5% EBIT growth in the cigarettes business as non-cigarette EBIT increased by 3.8% only,” he wrote in an investor note.

Click here to view the full announcement from ITC.