Академический Документы
Профессиональный Документы
Культура Документы
ON
ITC Limited
One of Indias Most Admired and Valuable
Companies
INTRODUCTION
Itc limited is a public conglomerate company head quartered in Kolkata .The Company is
currently headed by Yogesh Chander Deveshwar. It employs over 26,000 people at more
than 60 location.
Rated by BCG amongst Top 10 consumer goods companies in the world in terms of total
shareholder returns (TSR) Suring 2005-2009.
One of the foremost in the private sector in terms of:
Sustained value creation (BT-Stern Stewart survey)
Operating profits
Cash Profits
Itc is the only Indian FMCG Company to feature in Forbes 2000 List, A comprehensive
ranking of worlds biggest companies measured by a composite of sales, profits, assets &
market value.
ITCs ranking amongst all listed private sector cos.
PBT: No. 6
PAT: No. 5
Market Capitalization: No. 3
2012-13
29,606
11,566
10,771
10,684
7,418
23,569
45.7
244246
ITCs Vision
Make a significant and growing contribution towards:
Mitigating societal challenges
Enhancing shareholder rewards
By:
Financial capital
Environmental capital
Social capital
Trade creditors
Lenders
Investors
Management
Liquidity Ratio
Itc have high liquidity ratios, the higher the margin of safety that the company possess to
meet its current liabilities. Liquidity ratios greater than 1 indicate that the company is in good
financial health and it is less likely fall into financial difficulties. Seen in all the years above
2013, 2012, 2011.
Current ratio indicates Itc's ability to meet short-term debt obligations. The current ratio
measures whether or not a firm has enough resources to pay its debts over the next 12 month.
Profitability Ratio
Activity Ratio
A high debtor turnover ratio implies either that the company operates on a cash basis or that
its extension of credit and collection of accounts receivable are efficient. Also, a high ratio
reflects a short lapse of time between sales and the collection of cash, while a low number
means collection takes longer.
A low inventory turnover ratio can be seen because of rescission but it is very well aligned
with FMCG industry average.
Leverage Ratio
A very high interest cover suggest that the company is not capitalizing on the relatively
cheaper source of finance (i.e. debt) and in such instances an increase in gearing ratio may
actually add value to the enterprise.
Interest coverage is an indication of the margin of safety it does not run the risk of nonpayment of interest cost which could potentially threaten its solvency.
Market Ratio
PE Ratios
Current Share
price
33.2
311.65
Generally, stocks that are expected to grow earnings will have a higher P/E, Itc companies
with high growth have a higher ratio. Itc with the higher P/E is said to be overvalued by the
market.
The share price should reflect a firms future value creation potential, greater value creation
can indicate greater future dividends from the company. A higher P/E ratio should reflect
greater expected future gains because of perceived growth opportunities and/or some
competitive advantages and/or lesser risk, but at the same time it indicates that the share price
is relatively more expensive.
Du Point Analysis
DuPont analysis tells us that ROE is affected by three things:
ROA (%)
ROE (%)
ROCE
(%)
Mar'
13
23.55
36.21
52.45
Mar'
12
22.65
35.58
51.66
The return on capital employed is another measure of the returns that the business generates.
This is expressed as the ratio between the profit before interest and taxes (PBIT) to the
Capital Employed (Loans and Owners Fund) in the business. The ROCE is increased to
52.45% from 51.66% signifies that the company is getting good return out of its investment
decisions.
The return on Total Assets is yet another method of calculating the return of the company.
This is calculated by taking the ratio between the PBIT (Profit before Interest and Taxes) to
the Total Assets of the company. Earning power of the company, i.e. 23.55%is quiet good and
the company is doing well.
MAR'12
( Cr.)
MAR'11
( Cr.)
781.84
Absolute
change
%Change
773.81
8.03
1.04%
18,010.05
18,791.89
0
0
77.32
872.72
15.52
0
107.12
1,072.68
15,179.46
15,953.27
0
0
86.58
801.85
20.82
0
93.82
1,003.07
2830.59
2838.62
0
0
-9.26
70.87
-5.3
0
13.3
69.61
18.65%
17.79%
0.00%
0.00%
-10.70%
8.84%
-25.46%
0.00%
14.18%
6.94%
1,424.84
3,371.27
1.77
4,303.95
9,101.83
28,966.40
1,395.31
3,067.77
1.94
4,012.46
8,477.48
25,433.82
29.53
303.5
-0.17
291.49
624.35
3532.58
2.12%
9.89%
-8.76%
7.26%
7.36%
13.89%
0
14,144.35
5,045.16
0
9,099.19
0
2,269.26
7.49
0
0
1,953.28
1,193.61
0
14,522.83
0
12,765.86
4,420.75
0
8,345.11
0
1,322.60
10.8
0
0
1,563.30
1,146.47
0
12,388.28
0
1378.49
624.41
0
754.08
0
946.66
-3.31
0
0
389.98
47.14
0
2134.55
0.00%
10.80%
14.12%
0.00%
9.04%
0.00%
71.58%
-30.65%
0.00%
0.00%
24.95%
4.11%
0.00%
17.23%
4,363.31
5,637.83
986.02
2,818.93
136.89
500.59
14,443.57
5,341.74
3,991.32
5,269.17
885.1
2,243.24
93.26
563.45
13,045.54
4,568.06
371.99
368.66
100.92
575.69
43.63
-62.86
1398.03
773.68
9.32%
7.00%
11.40%
25.66%
46.78%
-11.16%
10.72%
16.94%
Investments)
Total Current Assets Excluding Current
Investments
Miscellaneous Expenses not written off
Total Assets
Contingent Liabilities
Total Debt
Book Value (in )
Adjusted Book Value (in )
10,080.26
9,054.22
1026.04
11.33%
0
28,966.40
287.08
89.12
23.97
23.97
0
25,433.82
255.17
99.2
20.55
20.55
0
3532.58
31.91
-10.08
3.42
3.42
0.00%
13.89%
12.51%
-10.16%
16.64%
16.64%
Gross Sales
Less :Inter divisional transfers
Less: Sales Returns
Less: Excise
Net Sales
EXPENDITURE:
Increase/Decrease in Stock
Raw Materials Consumed
Power & Fuel Cost
Employee Cost
Other Manufacturing Expenses
General and Administration Expenses
Selling and Distribution Expenses
Miscellaneous Expenses
Expenses Capitalised
Total Expenditure
PBIDT (Excl OI)
Other Income
Operating Profit
Interest
PBDT
Depreciation
Profit Before Taxation & Exceptional
Items
Exceptional Income / Expenses
Profit Before Tax
Provision for Tax
PAT
Extraordinary Items
Adj to Profit After Tax
Profit Balance B/F
Appropriations
Equity Dividend (%)
Earnings Per Share (in )
Book Value (in )
MAR'13
MAR'12
Absolute
change
Change
%
( Cr.)
42,105.51
0
0
12,204.24
29,901.27
( Cr.)
35,220.89
0
0
10,073.43
25,147.46
19.55%
0.00%
0.00%
21.15%
18.90%
-65.59
9,697.02
453.02
1,257.62
1,053.51
1,049.68
1,954.62
878.92
0
16,278.80
8,868.66
825.34
9,694.00
97.96
9,596.04
698.51
8,897.53
6,884.62
0.00
0.00
2,130.81
4,753.81
0.00
-180.76
2,615.11
97.09
129.39
103.51
184.71
133.70
-78.83
0.00
3,003.92
1,749.89
141.76
1,891.65
7.95
1,883.70
97.05
1,786.65
-246.35
12,312.13
550.11
1,387.01
1,157.02
1,234.39
2,088.32
800.09
0
19,282.72
10,618.55
967.1
11,585.65
105.91
11,479.74
795.56
10,684.18
0
10,684.18
3,265.79
7,418.39
0
0
1,972.59
9,390.98
525
9.39
28.14
0
8,897.53
2,735.16
6,162.37
0
0
548.67
6,711.04
450
7.88
23.97
0.00
1,786.65
530.63
1,256.02
0.00
0.00
1,423.92
2,679.94
75.00
1.51
4.17
0.00%
20.08%
19.40%
20.38%
0.00%
0.00%
259.52%
39.93%
16.67%
19.11%
17.41%
-275.59%
26.97%
21.43%
10.29%
9.83%
17.60%
6.84%
-8.97%
0.00%
18.45%
19.73%
17.18%
19.51%
8.12%
19.63%
13.89%
20.08%
Mar'12
Mar'13
2.69912
7
0
62.1756
6
64.8747
9
0
0
0.26693
3.01287
0.05357
9
0
0.36980
8
3.70318
7
0
4.91894
1
11.63855
0.006111
14.8584
2
31.4220
3
100
3.042445
48.8302
17.4172
8
0
31.4129
1
0
7.834111
0.02585
8
0
0
6.74326
1
0
59.68219
62.72463
0
0
0.340413
3.152692
0.08186
0
0.368879
3.943843
0
5.486042
12.06177
0.007628
15.77608
33.33152
100
0
50.19246
17.38138
0
32.81108
0
5.200163
0.042463
0
0
6.14654
4.12067
1
0
50.1368
1
0
15.0633
5
19.4633
4
3.40401
3
9.73172
4
4.507659
0
48.7079
0
15.69296
20.71718
3.480012
8.81991
0.366677
2.215357
1.72817
5
49.8631 51.2921
9
18.44116 17.96057
34.7998
4
0
100
35.59914
0
100
Mar'13
Mar'12
Gross Sales
Less :Inter divisional transfers
Less: Sales Returns
Less: Excise
Net Sales
EXPENDITURE:
Increase/Decrease in Stock
Raw Materials Consumed
Power & Fuel Cost
Employee Cost
Other Manufacturing Expenses
General and Administration Expenses
Selling and Distribution Expenses
Miscellaneous Expenses
Expenses Capitalised
Total Expenditure
100.00
0
0
28.9849
71.0151
0
-0.58508
29.24114
1.306504
3.294129
2.747906
2.931659
4.959731
1.900203
0
45.79619
100.00
0
0
28.60073
71.39927
0
-0.18622
27.53201
1.286225
3.570665
2.991151
2.980277
5.549604
2.495451
0
46.21916
25.21891
2.296849
27.51576
0.251535
27.26422
1.889444
25.37478
25.18011
2.343325
27.52344
0.27813
27.24531
1.983226
25.26208
0
25.37478
7.756206
17.61857
0
0
4.684874
22.30345
1.246868
0.022301
0.066832
0
25.26208
7.765732
17.49635
0
0
1.557797
19.05415
1.277651
0.022373
0.068056
Trend Analysis
From the analysis we can see that co. is growing at steady rate and remarkable points are:
1. We can see below that companys capital is increased by 105.33%, this is because of
issue of bonus shares in the year 2010-2011. This shows that the companys owned
fund is increasing. Reserve and Surplus is constantly increasing which shows that the
companys accumulated
2. Profits is increasing at a growing rate. It shows that company is making more profit.
3. By analysing sources of fund we can state that, company is more dependent on
owners fund rather than borrowed fund.
4. Investment is also growing at increasing rate. In last 4 years it has increased by
89.28%.
5. Current asset is increasing by 45.09%. This is due to increase in cash and bank
balance and other current assets.
6. Net income and expenses are increasing by 51.02% and 47.38% respectively. This
shows that the income of the co. is 3.64% higher than its expenses.
NET
WORT
H
NET
SALES
PBIT
PBT
PAT
DIVIDEN
D
ITC
21661
22288
2,674
2,674
11,566.2
1
5,219.05
10,684.1
8
4,957.88
7,418.39 4,148.46
Hindustan
Unilever
Nestle India
United
Spirits
Godrej
Consumer
Products
1798
6391
1798
6391
29,901.2
7
25,810.2
1
8,326.55
8,585.10
1,856.37
1,211.99
1,552.62
483.99
1,067.93 467.62
320.8
32.7
2761
2761
3,581.02
680.72
632.96
510.94
3,796.67 3,999.99
170.16