Introduction

The financial performance analysis of a company or a firm is generally done using

ratio analysis, comparative statements and common size statements. For the purpose
of analysis I also used the above mentioned tools such as the ratios, comparative
statements and common size statement.

Objectives of Study
 To analyse the financial Position and performance of ITC Ltd
 To suggest measures to improve the performance of the company based on
findings of the study

Nature of Data
The study is based on Secondary data.

Sources of Data

The details related to the study are collected from the published financial
statements of the Company website of the company, books, journals and internet.

Limitation of Study
1. The time available for the study is limited so in-depth study could not be
undertaken.
2. The information provided in the financial statement may not be precise.
3. The result of the study cannot be generalized

ITC Income Statement 2021-22

No. of Months Year Ending 12 Mar-21* 12 Mar-22* % Change

Rs
Net Sales 4,53,904 5,61,312 23.7%
m
Rs
Other income 26,337 18,922 -28.2%
m
Rs
Total Revenues 4,80,242 5,80,235 20.8%
m
Rs
Gross profit 1,70,149 2,06,232 21.2%
m
Rs
Depreciation 16,456 17,324 5.3%
m
Rs
Interest 580 600 3.4%
m
Rs
Profit before tax 1,79,451 2,07,230 15.5%
m
Rs
Tax 45,553 52,373 15.0%
m
Rs
Profit after tax 1,33,898 1,54,857 15.7%
m
Gross profit margin % 37.5 36.7  
Net profit margin % 29.5 27.6  
 ITC Income Statement Analysis

 Operating income during the year rose 23.7% on a year-on-year (YoY) basis.
 The company's operating profit increased by 21.2% YoY during the fiscal. Operating profit
margins witnessed a fall and stood at 36.7% in FY22 as against 37.5% in FY21.
 Depreciation charges increased by 5.3% and finance costs increased by 3.5% YoY,
respectively.
 Other income declined by 28.2% YoY.
 Net profit for the year grew by 15.7% YoY.
 Net profit margins during the year declined from 29.5% in FY21 to 27.6% in FY22.

ITC Balance Sheet as on March 2022

No. of Months Year 12 Mar- 12 Mar- %

Ending 21* 22* Change
Net Rs 5,86,40 6,11,39 4.26051
worth m 8 2 5
       

Current Rs 1,06,89 1,21,63 13.7889

Liabilities m 7 7 7
Long- Rs
56 49
term Debt m -12.5
Total Rs 7,37,60 7,71,96 4.65721
Liabilities m 8 0 6
       
Current Rs 3,49,92 3,42,32
assets m 0 5 -2.1705
Fixed Rs 3,87,68 4,29,63 10.8200
Assets m 8 6 4
Total Rs 7,37,60 7,71,96 4.65721
Assets m 8 0 6

ITC Balance Sheet Analysis

 The company's current liabilities during FY22 stood at Rs 122 billion as compared to Rs 107
billion in FY21, thereby witnessing an increase of 13.8%.
 Long-term debt down at Rs 49 million as compared to Rs 56 million during FY21, a fall of
13.1%.
 Current assets fell 2% and stood at Rs 342 billion, while fixed assets rose 11% and stood at Rs
430 billion in FY22.
 Overall, the total assets and liabilities for FY22 stood at Rs 772 billion as against Rs 738
billion during FY21, thereby witnessing a growth of 5%.

ITC Cash Flow Statement 2021-22

Particular No. of
12 12 % Change
s months
 Year
Mar-21 Mar-22
Ending
Cash Flow
from
Operating
Rs m 1,25,270 1,57,755 25.9319
Activities 9
Cash Flow
from
Rs m 56,829 -22,385 -
Investing
Activities
Cash Flow
from - -
Rs m -
Financing 1,86,338 1,35,805
Activities
Net Cash
Rs m -3,669 -435 -
Flow

ITC Cash Flow Statement Analysis

 ITC's cash flow from operating activities (CFO) during FY22 stood at Rs 158 billion, an
improvement of 25.9% on a YoY basis.
 Cash flow from investing activities (CFI) during FY22 stood at Rs -22 billion on a YoY basis.
 Cash flow from financial activities (CFF) during FY22 stood at Rs -136 billion, an improvement
of 27% on a YoY basis.
 Overall, net cash flows for the company during FY22 stood at Rs -435 million from the Rs -4
billion net cash flows seen during FY21.

Per Share Data/Valuations

12 Mar- 12 Mar-
No. of Mths Year Ending
21* 22*

Sales per share

Rs 36.9 45.5
(Unadj.)

TTM Earnings per

Rs 10.9 12.6
share

Diluted earnings
Rs 10.9 12.6
per share

Price to Cash
x 17.9 16.6
Flow

TTM P/E ratio x 20.1 21.2

Price / Book
x 4.2 4.7
Value ratio

Market Cap Rs m 24,38,690 28,61,460

Dividends
per share Rs 10.8 11.5
(Unadj.)
 Current Valuations for ITC

 The trailing twelve-month earnings per share (EPS) of the company stands at Rs 12.6, an
improvement from the EPS of Rs 10.9 recorded last year.
 The price to earnings (P/E) ratio, at the current price of Rs 265.8, stands at 21.2 times its
trailing twelve months earnings.
 The price to book value (P/BV) ratio at current price levels stands at 5.4 times, while the
price to sales ratio stands at 5.8 times.
 The company's price to cash flow (P/CF) ratio stood at 16.6 times its end-of-year operating
cash flow earnings.
Current Ratio = Current Asset/Current Liability

No. of Mths Year 12 Mar- 12 Mar-

Ending 21* 22*

Current ratio x 3.3 2.8

Debtors’
Days 2 2
Days
Interest
x 310.6 346.4
coverage

Debt to
x 0 0
equity ratio
Return on
% 18.2 20.1
assets
Return on
% 22.8 25.3
equity
Return on
capital % 30.7 34
employed