financial perfomense analysis

Imperial Tobacco Company of India Limited

(ITC).

PRESENTED BY

HANEESHA HAKKIM

FLOW OF PRESENTATION

Company profile

Vision & mission

Financial analysis

Conclusion

ITC. Touching your life. Everyday

PROFILE OF ITC• Type: Public• Traded as: BSE: 500875 BSE SENSEX Constituent• Industry: Conglomerate• Predecessor(s):• Founded: August 24, 1910 (as Imperial Tobacco Company of India)

Founder(s) Henry Overton Wills • Headquarters: Kolkata, West Bengal, India• Chairman: Yogesh Chandler Deveshwar• Products: Tobacco, Hotels, Paperboards & specialty papers,

packaging, agri-business, packaged foods & confectionery, IT, branded apparel, personal care, stationery, safety matches and other FMCG products

• Revenue : US$ 7 billion (2010) • Employees : 29,000 (2012)• Website : www.itcportal.com

VISION & MISSION

• Vision: Sustain ITC’s position as one of India’s most valuable corporations through world class performance, creating growing value for the Indian economy and the Company’s stakeholders.

• Mission: To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering superior and sustainable stakeholder value.


FINANCIAL ANALYSIS

• BALANCE SHEET• trend and percentage analysis• PROFIT AND LOSS ACCOUNT• trend and percentage analysis


Trend analysis of balance sheetsources of fund


Mar' 14 Mar' 13 Mar' 12 Mar' 11 Mar' 100

50

100

150

200

250

300

350

400

450

Series1

Interpretation

• Base year is 2010• Show a positive trend over the years• The general reserve is contribute more• So the company retained earning is high• Their main sources for production

requirement is reserve


Trend analysis of balance sheetapplication of fund



100

200

300

400

500

600

700

800

900

1000

Series1

INTERPRETATION

• 2012 is make a different increase in the flow

• Capital work in progress is high• Company invest or applying more in

production


Common size vertical analysis of sources of funds balance sheet


Owners'

Fund

Equity

Share

Cap

ital

Share

App

licati

on M

oney

Pefer

ence

Share

Cap

ital

Reserv

es &

Surp

lus

Secu

red L

oans

Unsec

ured

Loa

ns0

100

200

300

400

500

600

Mar' 11

Mar' 12

Mar' 13

Mar' 14

Series1

INTERPRETATION• Major sources is general reserve• The retained earning of the company is

increased by over the years.• They invest more in the work in progress• Equity shareholders not get regular

dividends


Common size vertical analysis of application of funds balance sheet


1 2 3 4 5 6

-20

0

20

40

60

80

100

120

Series4

Series3

Series2

Series1

INTERPRETATION

• Net block is increasing• Investment flows show that the company is

saves more money for the future• Proper application of money is done.


Common size horizontal analysis of balance sheet sources of funds


1 2 3 4 5 60%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Series7

Series6

Series5

Series4

Series3

Series2

Series1

INTERPRETATION

• Analysing the various resources of balance sheet the major contribution is reserves

• Each one is contributing to the balance sheet


Common size horizontal analysis of balance sheet application of funds


1 2 3 4 50%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Series4

Series3

Series2

Series1

INTERPRETATION

• Each item is contributing • In 2010 total net current item is become -10

lower value• So the liquidity position of the company is

in deficiency


Trend analysis of profit and loss account


Operat

ing i

ncom

e

Mate

rial c

onsu

med

Man

ufac

turin

g exp

ense

s

Perso

nnel

expe

nses

Selli

ng ex

pens

es

Admin

strati

ve ex

pens

es

Expen

ses c

apita

lised

Cost o

f sale

s

Operat

ing p

rofit

Other

recur

ring i

ncom

e

Adjus

ted PB

DIT

Fina

ncial

expe

nses

Deprec

iatio

n

Other

write o

ffs

Adjus

ted PB

T

Tax ch

arges

Adjus

ted PA

T

Non re

curri

ng it

ems

Other

non c

ash a

djus

tmen

ts

Repor

ted ne

t pro

fit

Earnig

s befo

re ap

prop

riatio

n

Equity

divi

dend

Prefe

rence

divi

dend

Divid

end t

ax

Retain

ed ea

rnin

gs0

500

1000

1500

2000

2500

3000

3500

4000

Series10

Series9

Series8

Series7

Series6

Series5

Series4

Series3

Series2

Series1

INTERPRETATION

• The 5 year analysis shows that company year 2012 is benchmark year

• The trend flow of each item in 2012 is increased in compare with other years

• Sales is increasing year by year• ITC also introduced new products in the

market


Common size analysis of profit and loss account


Operat

ing i

ncom

e

Mate

rial c

onsu

med

Man

ufac

turin

g exp

ense

s

Perso

nnel

expe

nses

Selli

ng ex

pens

es

Admin

strati

ve ex

pens

es

Expen

ses c

apita

lised

Cost o

f sale

s

Operat

ing p

rofit

Other

recur

ring i

ncom

e

Adjus

ted PB

DIT

Fina

ncial

expe

nses

Deprec

iatio

n

Other

write o

ffs

Adjus

ted PB

T

Tax ch

arges

Adjus

ted PA

T

Non re

curri

ng it

ems

Other

non c

ash a

djus

tmen

ts

Repor

ted ne

t pro

fit

Earnig

s befo

re ap

prop

riatio

n

Equity

divi

dend

Prefe

rence

divi

dend

Divid

end t

ax

Retain

ed ea

rnin

gs0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Series10

Series9

Series8

Series7

Series6

Series5

Series4

Series3

Series2

Series1

INTERPRETATION

• The chart shows the operating income is increased

• Indirect expenses, selling, manufacturing and work in progress are slightly increasing

• ITC makes new steps to enter in various markets so the direct as well as indirect expenses is increasing


Fund flow statement

FUND FLOW STATEMENTSOURCES OF FUND

APPLICATION OF FUND

Fund from operation 6092.9 Investment 3227

Issue of shares 513.5Changes in working capital 584.43

Dividend 293.5

Additional purchase 1893.34

Tax paid 608.11

6606.4 6606.38


INTERPRETATION

• Major sources of the company is issue of share capital

• ITC get profit from the fund from operation• The investment in additional assets is the major

application of money• The company is paying major part of the cash is in

retained earning form• Working capital is in a positive flow


FUND FROM OPERATION

TO TRANSFORMATION BY BALANCE B/D

TO RESERVE 3969 7418.39

TO DEPRECIATION 757.08BY FUND FROM OPERATION 6092.9

TO BALANCE C/D 8785.21

13511.29 13511.29


INTERPRETATION

• Company is not written off any items in 2014.

• Fixed assets depreciate additionally in 2014• Company is transferring amount to general

reserve


STATEMENT OF CHANGES IN WORKING CAPITAL 2013-2014

PARTICULARS 2013 2014WORKING CAPITAL

INCREASE DECREASE

CURRENT ASSET

Current Assets 14260.01 16097.49 1837.48

Current Liabilities 11663.18 12916.23 1253.05

TOTAL

DIFFERENSE 25923.19 29013.72 584.43


Fixed asset


PARTICULARS AMOUNT PARTICULARS AMOUNT

Depreciation 757.08 TO balance b/d 16679.17

Purchase of assets

1893.34

By balance b/d 18239.65

INTERPRETATION

• Only provide the total assets and liabilities. The statement of changes said that the increase in current assets. Increase in current liabilities leads to the decrease of working capital.


(Rs in Cr)


Profit Before Tax 12,659.11 10,684.18 8,897.53 7,268.16 6,015.31Net CashFlow-Operating Activity 6,962.30 6,709.89 6,015.59 5,264.24 4,630.65

Net Cash Used In INVESTING

-2,823.29 -3,580.78 -2,210.19 -616.22 -3,531.56 ActivityNetCash Used in

Fin. Activity -4,173.85 -3,232.55 -3,246.55 -3,551.64 -1,009.86Net Inc/Dec In

Cash And Equivlnt -34.84 -103.44 558.85 1,096.38 89.23Cash And

Equivalnt Begin of Year 155.9 259.34 2,178.92 1,082.93 993.7

Cash And Equivalnt End Of

Year 121.06 155.9 2,737.77 2,179.31 1,082.93ITC. Touching your life. Everyday

CASH FLOW STATEMENT

INTERPRETATION

• Cash from financial activity is negative, it means that the company sources and cash amount is low, depend more creditors.

• Cash from operation is positive, it shows the operational efficiency is high.

• Investment activity deals with the growth of the firm. ITC have enough investment. But additional investment make the overall operation is negative


CONCLUSION

• ITC promoting their brands through advertisement campaign as well as door to door promotion.

• ITC is also focusing on Retailers and Wholesalers to promote their brand.

• The demand of their product in very low, because people don’t know about their brands very well.

• The financial analysis shows that the company is in a positive flow

• They use various sources and make effective application of money

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