3 - Akhil Kohli - ITC Ltd.

BALANCE SHEET
Mar' 09 Mar' 08 Mar' 07 Mar' 06 Mar' 05
Sources of funds
Owner's fund
Equity share capital 377.44 376.86 376.22 375.52 248.22

Share application money - - - - 1.21
Preference share capital - - - - -
Reserves & surplus 13,302.55 11,624.69 10,003.78 8,626.79 7,586.28
Loan funds
Secured loans 11.63 5.57 60.78 25.91 88.69

Unsecured loans 165.92 208.86 140.1 93.82 156.67
TOTAL 13857.54 12215.98 10580.88 9122.04 8081.07
Uses of funds
Fixed assets
Gross block 10,558.65 8,959.70 7,134.31 6,227.17 5,746.27

Less : revaluation reserve 55.09 56.12 57.08 59.17 59.9
Less : accumulated depreciation 3,286.74 2,790.87 2,389.54 2,065.44 1,795.51
Net block 7,216.82 6,112.71 4,687.69 4,102.56 3,890.86
Capital work-in-progress 1,214.06 1,126.82 1,130.20 399.97 186.15
Investments 2,837.75 2,934.55 3,067.77 3,517.01 3,874.68
Net current assets

Current assets, loans & advances 8,450.99 7,306.99 6,281.07 5,228.49 3,736.66
Less : current liabilities & provisions 5,862.08 5,265.09 4,585.85 4,125.99 3,607.28
Total net current assets 2,588.91 2,041.90 1,695.22 1,102.50 129.38
Miscellaneous expenses not written - - - - -
TOTAL 13,857.54 12,215.98 10,580.88 9,122.04 8,081.07
PROFIT LOSS ACCOUNT
Mar '09 Mar '08 Mar '07 Mar '06 Mar '05
INCOME
Gross Sales 23,143.53 21,355.94 19,505.05 16,224.43 13,349.58
Less : Excise Duties and Taxes on Sales of
Products and Services 7755.42 7408.41 7135.75 6433.9 5710.13
Net Sales 15388.11 13947.53 12369.3 9790.53 7638

Other Income 534.93 610.90 336.49 286.08 235.81
TOTAL 15923.04 14558.43 12705.79 10076.61 Rs. 5.93
Expenditure
Raw Materials etc 6,446.78 6,016.70 5,384.86 3,983.23 2,769.07
Manufacturing, Selling etc. Expenses 4,101.11 3,531.50 3,031.31 2,491.85 2,119.77
Depreciation 549.41 438.46 362.92 332.34 312.87
TOTAL 11097.3 9986.66 8779.09 6807.42 5,202.19
PROFIT
Profit before Taxation 4,825.74 4,571.77 3,926.70 3,269.19 2,673.07
Provision for Taxation 1562.15 1451.67 1226.73 988.82 836
Profit after Taxation 3263.59 3120.1 2699.97 2280.37 1837.07
Profit brought forward 724.45 647.53 562.06 611.41 387.04
Available for appropriation 3,988.04 3,767.63 3,262.03 2,846.76 2,579.24
Appropriations
General Reserve 1,500.00 1,500.00 1,250.00 1,150.00 1,100.00
Proposed Dividend 1396.53 1319.01 1166.29 995.12 773.25
Income Tax on Proposed Dividend 198.21 139.58 109.25
- Current year 237.34 224.17
- Earlier year’s provision no longer reqd. -3.97
Profit carried forward 858.14 724.45 647.53 562.06 611.41
TOTAL 3988.04 3767.63 3262.03 2846.76 2594.38
Earnings Per Share (Face Value Re. 1.00 each) 19(iii)

Basic Rs. 8.66 Rs. 8.29 Rs. 7.19 Rs. 5.96 Rs. 5.85
Diluted Rs. 8.64 Rs. 8.25 Rs. 7.16 Rs. 5.93 Rs. 5.85
CCOUNT
CASH FLOWS
Profit before tax 4,825.74 4,571.77 3,926.70 3,269.19 2,673.07

Net cashflow-operating activity 3,279.03 2,722.96 2,141.19 1,929.68 1,851.20
Net cash used in investing activity -1,260.74 -1,736.78 -1,082.78 -175.31 -1,438.95
Netcash used in fin. activity -1,556.15 -1,316.09 -1,014.07 -954.21 -417.09
Net inc/dec in cash and equivlnt 462.14 -329.91 44.34 800.16 -4.84
Cash and equivalnt begin of year 570.25 900.16 855.82 55.66 60.5
Cash and equivalnt end of year 1,032.39 570.25 900.16 855.82 55.66
PROFITABILITY RATIOS
Gross profit margin (%) 32.85 31.57 32.51 34.36 36.4
Net profit margin (%) 21.18 21.5 21.4 22.19 28
Asset Turnover Ratio 1.67 1.75 1.843424 1.778597 1.651957
RETURN ON ASSET(%) 28.77885 30.84182 30.82948 31.20749 31.91706
RETURN ON EQUITY(%) 29.15236 31.39286 31.42611 31.62255 32.92156

EARNINGS PER SHARE Rs. 8.64 Rs. 8.25 Rs. 7.16 Rs. 5.93 Rs. 5.85
ANALYSIS
As we see from the graphs, profit margin has been varying marginally over time, this shows that profits are in
proportion to the sales , though both net profits and sales have been increasing over time which suggests that the
firm is in a healthy position.
Similar is the case is with the return on asset which has been almost the same for years which again shows
that the assets have been increasing along with the profits as ROA is equal to Profit after tax divided by Total
Asset
Though the stats are very healthy and increasing yearly but from these ratio we cannot predict cearly
the position of the firm as there is marginal difference in the ratios.
RATIOS
38
36
34
32
30 Gross profit margin (%)
28
30
20
10 Net profit margin (%)
0
1.9
1.8
1.7
1.6 Asset Turnover Ratio
1.5
34
32
30
28 RETURN ON ASSET(%)
26
34
32
30
28 RETURN ON EQUITY(%)
26
profits are in
suggests that the
ded by Total
LIQUIDITY RATIOS
CURRENT RATIO 1.441637 1.387819 1.369663 1.267209 1.035866
QUICK RATIO 0.6 0.56 0.58 0.57 0.42
INVENTORY TURNOVER RATIO 5.26 5.51 6.05 6.43 6.99

ANALYSIS
Current Ratio is the ratio of the current asset which are available and current liabilities and it has been increasing over
years which is a positive signal for the company as we have more asset in proportion to the liabilities.
Ideal Current ratio is 2 which suggests that the company has 2 times current asset in compaision to the current liabilities
Quick ratio is the ratio of the liquid assets(which can be converted into cash immediately)
It has been increasing which again is a positive signal for the company
Ideal Quick ratio is 1 which suggests that the co has equal quick asset as liabilities
Inventory Turnover Ratio is the ratio of the cost of good solds and Average Inventories available
which suggests that how easily the inventory is turned into sales . It has been increasing over
times which suggests that the company is keeping more inventory and getting more conservative
in its approach
ATIOS
2
1.5
1
0.5 CURRENT RATIO
0
0.7
0.6
0.5
0.4
0.3
0.2 QUICK RATIO
0.1
0
8
7
6
5
4
3 INVENTORY TURNOVER
2 RATIO
1
0
s been increasing over
to the current liabilities

SOLVENCY RATIOS
DEBT EQUITY RATIO 0.012979 0.017867 0.019353 0.0133 0.031318
Fixed assets turnover ratio 1.44 1.59 1.75 1.59 1.33
INTEREST COVER 275.8275 955.3015 1206.375 278.9086 65.8157

ANALYSIS
Debt Equity Ratio is the ratio between the total debt(which is equal to the secured and unsecured loans taken)
and the equity(which is equal to the share capital and the reserves and surplus)
As debt equity ratio is very low, this shows that most of the financing done by the company is through equity
and it uses very little debt.
Due to this very low DEBT EQUITY ratio, the firm exposes its creditors very less risk.
Interest Cover is the ratio of the profit before interst and tax and Interest Expense
It measures the protection available to the creditors for payment of interst charges by the co.
It is also the main factor for Credit Rating Agencies to mark the co.
As it has decreased to a great extent from the previous year, not a good signal though it is good as a number
So not much worries for the co. as there still it has a good credit rating.
ATIOS
0.035
0.03
0.025
0.02
0.015
DEBT EQUITY RATIO
0.01
0.005
0
2
1.5
1
Fixed assets turnover ratio
0.5
0
1500
1000
500 INTEREST COVER
0
ed loans taken)
rough equity
as a number
CAPITAL MARKET RATIOS
50
40
PRICE EARNINGS RATIO 28.24074 22.66667 33.37969 39.59732 16.17647
30
20
10
0
Mar '09 Mar '08 M
Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 2
1.5
DIVIDEND YIELD(%) 1.516393 1.458333 1.313559 1.152174 0.281818 1
0.5
0
Mar '09 Mar '08
12
Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 10
8
6
PRICE-TO-MARKET-VALUE) 6.732892 7.68 8.698804 9.803922 3.492063 4
2
0
Mar '09 Mar '08 M
ANALYSIS
PRICE EARNINGS RATIO is the ratio between the stock price and earnings per share.
It is the major factor for the investors to analyze the stock as it shows the confidence of
the market in the stock.
The ratio has been varying over years though the increase in the PE ratio over the last 2 years indicates
the greater confidence the market has shown towards the stock.
Dividend yield ratio is defined as the ratio of the dividend given per share to the average stock price
As the dividend yield ratio has been increasing over the times this suggests that the firm is paying
more dividend and hence +ve for the investors
Price to book ratio compares the market price of the company's share with the book value
As the price to book ratio is more, it suggests that the stock is not underpriced, again good for the investors.
RKET RATIOS
50
40
30
20
PRICE EARNINGS RATIO
10
0
2
1.5
1
0.5 DIVIDEND YIELD(%)
0
12
10
8
6
4 PRICE-TO-MARKET-VALUE)
2
0

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BALANCE SHEET

Mar' 09 Mar' 08 Mar' 07 Mar' 06 Mar' 05

Equity share capital 377.44 376.86 376.22 375.52 248.22

Secured loans 11.63 5.57 60.78 25.91 88.69

Gross block 10,558.65 8,959.70 7,134.31 6,227.17 5,746.27

Net current assets

Net Sales 15388.11 13947.53 12369.3 9790.53 7638

TOTAL 15923.04 14558.43 12705.79 10076.61 Rs. 5.93

TOTAL 11097.3 9986.66 8779.09 6807.42 5,202.19

Earnings Per Share (Face Value Re. 1.00 each) 19(iii)

Profit before tax 4,825.74 4,571.77 3,926.70 3,269.19 2,673.07

Gross profit margin (%) 32.85 31.57 32.51 34.36 36.4

Net profit margin (%) 21.18 21.5 21.4 22.19 28

Asset Turnover Ratio 1.67 1.75 1.843424 1.778597 1.651957

RETURN ON ASSET(%) 28.77885 30.84182 30.82948 31.20749 31.91706

RETURN ON EQUITY(%) 29.15236 31.39286 31.42611 31.62255 32.92156

CURRENT RATIO 1.441637 1.387819 1.369663 1.267209 1.035866

QUICK RATIO 0.6 0.56 0.58 0.57 0.42

INVENTORY TURNOVER RATIO 5.26 5.51 6.05 6.43 6.99

to the current liabilities

DEBT EQUITY RATIO 0.012979 0.017867 0.019353 0.0133 0.031318

Fixed assets turnover ratio 1.44 1.59 1.75 1.59 1.33

INTEREST COVER 275.8275 955.3015 1206.375 278.9086 65.8157

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