A Fundamental Analysis of ITC Limited

Back ground of ITC

ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of
India Limited. As the Company's ownership progressively Indianised, the name of the
Company was changed from Imperial Tobacco Company of India Limited to India Tobacco
Company Limited in 1970 and then to I.T.C. Limited in 1974. In recognition of the
Company's multi-business portfolio encompassing a wide range of businesses - Fast Moving
Consumer Goods comprising Foods, Personal Care, Cigarettes and Cigars, Branded Apparel,
Education and Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards
& Specialty Papers, Packaging, Agri-Business and Information Technology - the full stops in
the Company's name were removed effective September 18, 2001. The Company now stands
rechristened 'ITC Limited,' where 'ITC' is today no longer an acronym or an initialised form.

ITC is one of the few enterprises in the world that has traversed a 100 year journey and has
yet managed to remain contemporary, relevant and competitive In the early autumn of 1910,
sitting in the narrow confines of his modest office in Radha Bazar Street, Calcutta, it would
have been impossible for the lone expatriate manager to even imagine what history would
have in store for the company he represented. From being a one-product category, ITC's
portfolio now spans 20 categories with over 1,500 stock keeping units (SKUs). Today, a
network of 100 factories churn out ITC's products, compared to just six units set up in the
first 50 odd years. Contribution to enhancing the productivity of the entire value chain and
meeting stakeholder expectations was as critical to this vision as maximising capital
efficiency and improving returns on deployed resources. The potential to generate significant
foreign exchange earnings (at a time when India was starved of it) and its multiplier capacity
to create large scale employment in the tourism sector were the triggers for ITC's foray into
the hotels business. ITC's belief that strength of capital and the scale of operations across
product-market arenas would provide unique competitive advantages was perhaps ahead of
its time. ITC restructured its portfolio of businesses based on the strategic fit between market
opportunities and its core capabilities. Today, ITC creates livelihoods for around 6 million
people. Its revolutionary e-Choupal, is supposed to have benefited over 4 million farmers.
The company's sustainability programme includes large-scale watershed development, social
forestry, animal husbandry, women's empowerment and primary education which have
significantly impacted lives in rural India. In rare feet, 40 per cent of ITC's energy
consumption comes from renewable sources and several of its properties have achieved the
highest levels of LEED certification.
Rationale for choosing ITC
ITC is one of the blue-chip companies of S&P BSE SENSEX. The company is regularly
declaring the dividend. It is one of best performing companies in FMCG sector and continues
to remain among top 30 companies of BSE. As on 31st May’ 19, ITC has a market
capitalization of Rs. 341464.18 crore and remains to be listed in BSE since last three decades.
It would be interesting to know it’s fundamentals, which are most important in identifying the
reasons of success of ITC. It is also observed that dividend policy of the ITC sis very
consistent and paying regular return to its shareholder. It helps it to maintain the trust of
shareholders in to the company. This study aims at understanding what the reasons and
factors which contribute towards making ITC remain profitable all along.

Objectives

As investment decision is a part of one’s economic life and everyone takes decision to invest
at different context. Investment decisions are to be made in a systematic manner with two
approaches such as technical and fundamental analysis. The present study aims to analyse the
fundamental analysis of BSE listed ITC. The objectives of the study will be

 To conduct fundamental analysis ITC.

 To know the financial position of the ITC
 To find out the efficiency and risk of the operations.
 To analyse the strength and weakness
 To find out the financial capability of ITC.

The study will cover fundamental analysis on ITC on the basis of share volume and
market capitalization.

Group No.5

1. Manvir Singh (x01016)

2. Swapnil Thakkar (x01029)
3. Pankaj Singh (x01019)