Cross Sectional Analysis

Between ITC and HUL

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Hindustan Unilever Limited (HUL)

⊸ HUL is a well-diversified company producing foods, beverages, personal care products,
cleaning agents, several other consumer goods and water purifiers.
⊸ The company is headed by CEO Sanjiv Mehta and is headquartered in Mumbai, India.
⊸ It’s a subsidiary of the British-Dutch company Unilever .
⊸ The company was founded in 1933.
⊸ In 1956, Hindustan Vanaspathi, Lever Brothers and United Traders merged to become
Hindustan Lever Limited.
⊸ In 2007, the company was renamed as ‘Hindustan Unilever Limited’.
⊸ In a research, it was found that 9 out of 10 households in India use HUL products.
⊸ HUL generates revenues in excess of ₹ 40,000 crore, making it one of the largest FMCG
companies in India.
⊸ In May 2020, HUL is the 4th most valuable listed company after Reliance, TCS and HDFC
Bank.
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ITC Limited
⊸ The company was established in 1910 as ‘Imperial Tobacco Company of India
Limited’.
⊸ It was renamed to ‘India Tobacco Company Limited’ in 1970.
⊸ It was renamed again in 1974 to its current name ‘ITC Limited’.
⊸ ITC completed 100 years of business in 2010, making it one of the oldest companies in
India.
⊸ The company is mainly into Tobacco, other FMCG, Hotels, Paper, Packaging nd Agri
Commodities business.
⊸ The main brands of ITC include Gold Flake, Aashirvaad, Bingo and Sunfeast.
⊸ ITC is the market leader in cigarette business with more than 85% market share.
⊸ ITC generates revenues in excess of ₹ 52,000 crore, making it one of the largest FMCG
companies in India.
⊸ In May 2020, ITC is the 10th most valuation listed company in India
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CURRENT RATIO

QUICK RATIO

INVENTORY TURNOVER RATIO

EPS

NET PROFIT / SHARE

DIVIDEND / SHARE

GROSS PROFIT MARGIN

NET PROFIT MARGIN

RETURN ON ASSETS

RETURN ON CAPITAL EMPLOYED

DEBT / EQUITY

ASSET TURNOVER RATIO

DIVIDEND PAYOUT RATIO

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  Mar 2021 Mar 2020 Mar 2019 Mar 2018 Mar 2017

Operating Activities 8,957 7,305 5,728 5,916 4,953

Investing Activities -1,367 1,926 -264 -1,264 -752

Financing Activities -9,280 -6,676 -5,462 -4,651 -4,264

Others 0 0 0 0 0

Net Cash Flow -1,690 2,555 2 1 -63

Equities & Liabilities Mar 2021 Mar 2020 Mar 2019 Mar 2018 Mar 2017

Share Capital 235 216 216 216 216

Reserves & Surplus 47,439 7,998 7,627 7,065 6,528

Current Liabilities 11,103 9,317 8,667 8,887 7,714

Other Liabilities 9,980 2,622 2,119 1,694 1,248

Total Liabilities 68,757 20,153 18,629 17,862 15,706

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Annual Mar 2021 Mar 2020 Mar 2019 Mar 2018 Mar 2017

Sales 47,028 39,783 39,310 35,545 33,162

Other Income 410 632 550 384 369

Total Income 47,438 40,415 39,860 35,929 33,531

Total Expenditure 36,715 31,124 31,223 28,599 27,017

EBIT 10,723 9,291 8,637 7,330 6,514

Interest 117 118 33 26 35

Tax 2,606 2,409 2,544 2,079 1,977

Net Profit 8,000 6,764 6,060 5,225 4,502

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RATIO ANALYSIS OF UNILEVER

Hindustan Unilever Ltd. ITC Ltd.
Profit from Operations 10490 17164.15
Adjustments 890 -1318.74
Changes in assets and liabilities -56 -394.84

Tax paid -2367 -3956.62

Operating Activities 8,957 11493.95

Investing Activities -1,367 6497.89

Financing Activities -9,280 -18378.89

Net Cash Flow -1,690 -330.10

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 Financial Ratios Hindustan Unilever Ltd. ITC Ltd.

Basic EPS (rs.) 33.85 10.59
Dividend / share(rs.) 31.00 10.75
Revenue from operations/share (rs.) 195.73 36.95
Gross Profit / share (rs.) 50.37 15.25
Net Profit/share 33.85 10.59
Book Value/share 201.85 47.94
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Financial Ratios​ Hindustan Unilever Ltd.​ ITC Ltd.​

Gross Profit margin (%)​ 25.73​ ​ 1.27
4
Net profit margin (%)​ 17.29​ ​28.65
Return on networth / equity (%)​ 16.76​ ​22.08
Return on capital employed (%)​ 18.90​ ​28.02
Return on assets (%)​ 11.67​ ​18.20
Total debt/equity  0.00​ ​0.00
Asset turnover ratio (%)​ 67.52​ ​63.54
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Financial Ratios Hindustan Unilever Ltd. ITC Ltd.

Current Ratio  1.26 3.13
Quick Ratio  0.95 2.20
Inventory Turnover Ratio  13.60 4.80
Dividend Payout Ratio (NP) (%) 110.77 47.21
Earnings Retention Ratio (%) -10.77 52.79
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Financial Ratios Hindustan Unilever Ltd. ITC Ltd.

Enterprise Value  566,917 264951.06
EV/Net Operating Revenue  12.33 5.83
EV/EBITDA  47.89 14.11
MarketCap/Net Operating Revenue  12.42 5.91
Retention Ratios (%) -10.77 52.78
Price/BV  12.04 4.56
Price/Net Operating Revenue 12.42 5.91
Earnings Yield 0.01 0.05