Corporate Finance

Project Plan
ITC Limited.

Aastha Sachdeva
Aditya Thareja
Ankit Gupta
Ishu Singla
Ruchy Singh
Saket Agarwal
 ITC
In FMCG, ITC has a strong presence in:
• Cigarettes
• Foods
• Apparel
• Personal care
• Stationery
• Safety Matches and Agarbattis
Other businesses include:
• Hotels:
• Paperboard, Specialty Paper, Graphic and other Paper;
• Packaging and Printing for diverse international and Indian
clientele.
• Infotech

Objectives
Analyze the capital structure in the last 10
years and understand application of various
theories of capital structure.
Others:
 To find out the leverage trends in the industry
and locate various players around the industry
average
 To understand the correction to industry average
for capital structure, if any.
 Understand the impact of stock split and bonus
issues.
 To find out the divisional cost of capital for ITC.
 To find out differences in capital structure in
emerging and developed markets.
•
• To test the hypothesis regarding:
The relationship between size and leverage
across FMCG sector in India.
Correlation between profitability and capital
structure.
Correlation of capital structure around the
industry’s mean debt ratio.
•  
•
Methodology
Collection of data
vNSE website.
vWebsite of Corporate Entity under study.
vCapitaline & CMIE Prowess
Statistical Analysis:
 OLS, t-test, correlation
Calculation of Divisional cost of capital (Pure
Play Approach)
•
• To conclude findings in relevance of, if any:
 MM proposition
 Pecking order theory

 Agency costs

 NI & NOI theory