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Last Updated on: 30 May, 2024|Author: Getaka | Social: X Twitter Profile
Stock Ticker - BSE: 500875 | NSE: ITC

Fundamental Analysis of ITC Ltd

About the Company - ITC Ltd

ITC Ltd. is a Public Limited Listed company incorporated on 24/08/1910 and has its registered office in the State of West Bengal, India. Company’s Corporate Identification Number(CIN) is L16005WB1910PLC001985 and registration number is 001985. Currently company belongs to the Industry of Cigarettes & Tobacco Products. Company’s Total Operating Revenue is Rs. 56341.27 Cr. and Equity Capital is Rs. 1232.33 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
Cigarettes & Tobacco ProductsVirginia House, 37, Jawaharlal Nehru Road, Kolkata West Bengal 700071isc@itc.in
http://www.itcportal.com
Management
NamePosition Held
Mr. Sanjiv PuriChairman & Managing Director
Mr. Nakul AnandExecutive Director
Mr. Sumant BhargavanExecutive Director
Mr. Supratim DuttaExecutive Director & CFO
Mr. David Robert SimpsonNon Executive Director
Mr. Peter Rajatilakan ChittaranjanNon Executive Director
Mr. Mukesh GuptaNon Executive Director
Mr. Shyamal MukherjeeNon Executive Director
Mr. Sunil PanrayNon Executive Director
Mr. Anand NayakNon Executive Director
Mr. Shilabhadra BanerjeeNon Executive Director
Mr. Arun DuggalNon Executive Director
Ms. Meera ShankarNon Executive Director
Ms. Nirupama RaoNon Executive Director
Mr. Hemant BhargavaNon Executive Director
Mr. Ajit Kumar SethNon Executive Director

Basic Stock Data of ITC Ltd

Last Updated: May 30, 2024, 6:20 am

Market Cap 5,34,596 Cr.
Current Price 428
High / Low500/399
Stock P/E26.1
Book Value 59.7
Dividend Yield2.99 %
ROCE37.5 %
ROE28.5 %
Face Value 1.00
PEG Ratio4.62

Competitors of ITC Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
VST Industries Ltd 6,130 Cr. 3,9704,328/3,15920.3 8113.76 %32.5 %24.8 % 10.0
Industry Average6,130.00 Cr3,970.0020.30811.003.76%32.50%24.80%10.00

ITC Ltd Quarterly Results

MonthDec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023
Sales13,08014,34213,24713,75717,10816,55618,48917,10817,70517,63517,16417,77418,019
Expenses8,2959,4718,8048,74011,51010,95612,41210,84911,00011,01110,49411,32011,516
Operating Profit4,7854,8714,4445,0185,5985,5996,0776,2596,7056,6246,6706,4546,504
OPM %37%34%34%36%33%34%33%37%38%38%39%36%36%
Other Income546579447469422499321455595683722665651
Interest1339101011913912101014
Depreciation413409414422430467438462447461442453459
Profit before tax4,9055,0394,4675,0555,5805,6205,9506,2396,8446,8336,9406,6566,682
Tax %27%24%25%26%26%24%25%25%26%24%25%26%19%
Net Profit3,5873,8203,3443,7664,1274,2664,4724,6825,0805,2435,1904,9655,407
EPS in Rs2.873.052.663.013.293.403.563.734.034.164.103.934.28

Last Updated: May 7, 2024, 11:44 pm

ITC Ltd Quarterly Chart

ITC Ltd Profit & Loss

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023TTM
Sales26,51631,61835,30638,81739,19242,76843,44948,34049,38849,25760,64570,91970,278
Expenses17,27220,39822,22724,56624,66127,29826,92829,80230,04432,19340,02145,21543,825
Operating Profit9,24411,22113,08014,25214,53115,47016,52118,53719,34417,06520,62325,70426,453
OPM %35%35%37%37%37%36%38%38%39%35%34%36%38%
Other Income7728529661,2291,4831,7592,2402,0802,4172,5771,9102,0982,665
Interest10210829917849115718158607841
Depreciation7458599651,0281,0771,1531,2361,3971,6451,6461,7321,8091,804
Profit before tax9,16811,10613,05214,36214,85916,02617,40919,15020,03517,93820,74025,91527,273
Tax %31%31%31%32%36%35%34%33%22%25%25%25%
Net Profit6,3347,7049,0019,7799,50110,47711,49312,83615,59313,38315,50319,47720,477
EPS in Rs5.346.427.458.047.748.479.2410.2712.4510.6912.3715.4416.22
Dividend Payout %56%55%54%52%73%56%56%56%82%101%93%100%

ITC Ltd Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)16.84%8.64%-2.84%10.27%9.70%11.69%21.48%-14.17%15.84%25.63%6.54%
Change in YoY Net Profit Growth (%)0.00%-8.19%-11.49%13.12%-0.58%1.99%9.79%-35.65%30.01%9.79%-19.09%

ITC Ltd Growth

Compounded Sales Growth
10 Years:8%
5 Years:10%
3 Years:13%
TTM:1%
Compounded Profit Growth
10 Years:10%
5 Years:12%
3 Years:7%
TTM:12%
Stock Price CAGR
10 Years:7%
5 Years:8%
3 Years:30%
1 Year:3%
Return on Equity
10 Years:25%
5 Years:25%
3 Years:25%
Last Year:29%

Last Updated: May 2, 2024, 5:39 am

ITC Ltd Balance Sheet

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Sep 2023
Equity Capital7827907958028051,2151,2201,2261,2291,2311,2321,2431,247
Reserves18,67722,36826,44230,93441,87545,19851,29057,91564,04459,11661,22367,91267,852
Borrowings11810224226984463613277271249306284
Other Liabilities10,50912,06913,36913,9488,8889,44011,69512,58511,76013,14314,49116,37017,754
Total Liabilities30,08535,32940,84845,95251,65155,89864,24171,73977,31173,76177,19685,83187,137
Fixed Assets10,00712,14012,92115,30315,10715,89316,52419,37421,71323,29824,23225,85126,303
CWIP2,3962,0623,1172,7002,5603,7305,5084,1363,2564,0113,2263,0033,190
Investments5,2075,9817,2846,94311,74817,58122,05325,04328,66324,87124,84129,41526,637
Other Assets12,47515,14617,52621,00622,23718,69420,15623,18523,67821,58024,89827,56131,007
Total Assets30,08535,32940,84845,95251,65155,89864,24171,73977,31173,76177,19685,83187,137

ITC Ltd Reserves and Borrowings Chart

ITC Ltd Cash Flow

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Cash from Operating Activity 6,2567,1027,3449,8439,79910,62713,16912,58314,69012,52715,77618,878
Cash from Investing Activity -2,694-3,881-3,254-5,275-3,921-3,251-7,114-5,546-6,1745,740-2,238-5,732
Cash from Financing Activity -3,305-3,310-4,122-4,661-5,613-7,301-6,221-6,869-8,181-18,634-13,580-13,006
Net Cash Flow257-90-32-9326675-166169334-367-43139

ITC Ltd Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow-91.00-229.00-255.00-70.00-31.00-20.005.00-258.00-254.00-229.00-281.00-277.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

ITC Ltd Free Cash Flow Chart

ITC Ltd Financial Efficiency Indicators

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Debtor Days171625191821233019191515
Inventory Days243227228212244185173165187189150148
Days Payable585358506360807476786159
Cash Conversion Cycle202189195181199145115122129129104105
Working Capital Days-15-59-45245313235363120
ROCE %50%51%50%47%40%36%34%34%32%28%33%39%

ITC Ltd Financial Efficiency Indicators Chart

ITC Ltd Share Holding Pattern

MonthMar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023
FIIs12.79%11.74%10.81%9.99%11.99%12.68%42.68%42.99%43.35%43.62%43.34%43.26%
DIIs42.50%42.40%43.72%43.79%42.77%42.82%42.38%42.19%42.08%41.92%41.94%41.98%
Government0.00%0.00%0.00%0.00%0.00%0.00%0.04%0.04%0.04%0.04%0.04%0.04%
Public44.71%45.86%45.47%46.22%45.24%44.50%14.87%14.78%14.52%14.41%14.68%14.71%
No. of Shareholders21,96,47526,30,12825,68,03029,97,69928,40,96428,38,03628,96,35829,36,69229,30,52730,13,79332,74,36033,35,815

ITC Ltd Shareholding Pattern Chart

No. of ITC Ltd Shareholders

ITC Ltd Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)
SBI Nifty 50 ETF159,932,7013.886967.47
SBI S&P BSE Sensex ETF120,546,4694.785251
Parag Parikh Flexi Cap Fund73,539,7505.013203.76
ICICI Prudential Bharat 22 ETF63,811,44215.492779.63
SBI Blue Chip Fund50,300,0004.832191.32
UTI Nifty 50 ETF45,721,5403.881991.86
UTI S&P BSE Sensex ETF43,226,6684.781882.95
HDFC Balanced Advantage Fund - Regular Plan41,497,7262.161807.85
ICICI Prudential Balanced Advantage Fund37,560,7172.891636.33
Nippon India Large Cap Fund35,050,2405.841526.96

ITC Ltd ROCE Trend

ITC Ltd EPS Trend

ITC Ltd Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue1.001.001.001.001.00
Basic EPS (Rs.)16.4215.5012.3710.7012.47
Diluted EPS (Rs.)16.3815.4612.3710.7012.45
Cash EPS (Rs.)18.0517.0913.9712.2214.02
Book Value[Excl.RevalReserv]/Share (Rs.)59.9955.9550.9849.3153.41
Book Value[Incl.RevalReserv]/Share (Rs.)59.9955.9550.9849.3153.41
Revenue From Operations / Share (Rs.)61.5557.0849.2340.0340.19
PBDIT / Share (Rs.)23.2122.2418.2515.9517.78
PBIT / Share (Rs.)21.7620.7916.8514.6216.44
PBT / Share (Rs.)21.7220.8116.8214.5816.29
Net Profit / Share (Rs.)16.6015.6312.5710.8812.68
NP After MI And SOA / Share (Rs.)16.3915.4412.3710.6912.45
PBDIT Margin (%)37.7138.9737.0739.8544.24
PBIT Margin (%)35.3536.4234.2236.5140.91
PBT Margin (%)35.2836.4634.1536.4140.53
Net Profit Margin (%)26.9627.3825.5227.1731.54
NP After MI And SOA Margin (%)26.6227.0525.1226.7130.98
Return on Networth / Equity (%)27.4527.7524.4021.8023.44
Return on Capital Employeed (%)34.7635.8131.8928.4929.80
Return On Assets (%)22.2722.3419.7217.8219.78
Asset Turnover Ratio (%)0.860.820.750.610.62
Current Ratio (X)3.002.892.813.274.13
Quick Ratio (X)1.972.021.912.293.19
Inventory Turnover Ratio (X)1.671.841.571.481.64
Dividend Payout Ratio (NP) (%)0.0038.8142.4446.7446.05
Dividend Payout Ratio (CP) (%)0.0035.4638.1141.5541.58
Earning Retention Ratio (%)0.0061.1957.5653.2653.95
Cash Earning Retention Ratio (%)0.0064.5461.8958.4558.42
Interest Coverage Ratio (X)630.60639.94571.51440.45399.74
Interest Coverage Ratio (Post Tax) (X)452.07449.03394.44301.35288.43
Enterprise Value (Cr.)528208.39472093.81304785.83264644.53204533.29
EV / Net Operating Revenue (X)6.876.665.025.374.14
EV / EBITDA (X)18.2317.0813.5513.489.36
MarketCap / Net Operating Revenue (X)6.966.725.095.464.28
Retention Ratios (%)0.0061.1857.5553.2553.94
Price / BV (X)7.186.894.954.463.24
Price / Net Operating Revenue (X)6.966.725.095.464.28
EarningsYield0.030.040.040.040.07

ITC Ltd Profitability Ratios (%)

ITC Ltd Liquidity Ratios

ITC Ltd Liquidity Ratios (%)

ITC Ltd Interest Coverage Ratios (%)

ITC Ltd Valuation Ratios

Fair Value

Fair Value: ₹457.36

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

Undervalued: 6.86% compared to the current price ₹428

Intrinsic Value: ₹483.21

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators along with EPS growth.

Undervalued: 12.90% compared to the current price ₹428

Last 5 Year EPS CAGR: 5.65%

*Investments are subject to market risks

Strength and Weakness of ITC Ltd Stock

StrengthWeakness
  1. The stock has a high average ROCE of 35.33%, which is a positive sign.
  2. The company has higher reserves (50,131.33 cr) compared to borrowings (183.17 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (47.83 cr) and profit (17.75 cr) over the years.
  1. The stock has a high average Working Capital Days of 32.17, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 146.58, which may not be favorable.

Should I Buy ITC Ltd Share Now?

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in ITC Ltd:
    1. Net Profit Margin: 26.96%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 34.76% (Industry Average ROCE: 32.5%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ✓ ROE%: 27.45% (Industry Average ROE: 24.8%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 452.07
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 1.97
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. ✗ Stock P/E: 26.1 (Industry average Stock P/E: 20.3)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. ✗ Total Debt / Equity: N/A
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

FAQ

What is the latest fair value of ITC Ltd?

The latest fair value of ITC Ltd is ₹457.36.

What is the Market Cap of ITC Ltd?

The Market Cap of ITC Ltd is 5,34,596 Cr..

What is the current Stock Price of ITC Ltd as on 30 May 2024?

The current stock price of ITC Ltd as on 30 May 2024 is ₹428.

What is the High / Low of ITC Ltd stocks in FY 2024?

In FY 2024, the High / Low of ITC Ltd stocks is 500/399.

What is the Stock P/E of ITC Ltd?

The Stock P/E of ITC Ltd is 26.1.

What is the Book Value of ITC Ltd?

The Book Value of ITC Ltd is 59.7.

What is the Dividend Yield of ITC Ltd?

The Dividend Yield of ITC Ltd is 2.99 %.

What is the ROCE of ITC Ltd?

The ROCE of ITC Ltd is 37.5 %.

What is the ROE of ITC Ltd?

The ROE of ITC Ltd is 28.5 %.

What is the Face Value of ITC Ltd?

The Face Value of ITC Ltd is 1.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in ITC Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE