The Kolkata-headquartered company saw its revenue from total FMCG business, including cigarettes, dive to Rs 7,988.27 crore during the quarter, down from Rs 11,840.70 crore in the corresponding quarter of the last fiscal.
Analysts on average expected a net profit of Rs 2,845 crore, according to Thomson Reuters data.
Total income in the quarter under review stood at Rs 11329.74 crore, down 26 per cent from Rs 15410.92 crore in the corresponding period previous year. The company had posted a net profit of Rs 2,669.47 crore in the January-March period a year ago.
ITC undertook cost management initiatives across its business verticals, it said.
The company said the punitive and discriminatory taxation and the regulatory regime continues to exert severe pressure on the domestic legal cigarette industry even as illegal cigarette trade has been growing unabated.
Revenue from others segments in the FMCG category rose 5.7 per cent at Rs. 3,051.82 crore.
Puri, who was previously a wholetime director, was elevated to the post of the chief executive officer after Y.C. Deveshwar left the executive position.
The board of directors recommended an ordinary dividend of Rs 5.15 per share for the year ended March 31, 2018.
"Shortage of leaf tobacco in Andhra Pradesh due to lower crop output on account of drought in 2016 and adverse crop quality, relative strength of the Rupee vis-à-vis currencies of competing origins and limited trading opportunities in other agri-commodities weighed on the performance of the Agri Business", said ITC.
Paper business did marginally better with profits going up from Rs 240.17 crore to Rs 242.42 crore as input costs remain benign, higher substitution of imported pulp with in-house production and continued focus on product mix.
Shares of ITC closed at Rs 285.95 on BSE, up 1.47 percent from previous close.