ITC Limited Result Review Q2 20: Profit jumps 36.16%

ITC Limited

Established in 1910 as ‘Imperial Tobacco company of India Limited’ the company was renamed in 1970 to ‘India Tobacco Company Limited’ and later in 1974 to I.T.C Limited and then in 2001 by removing dots in name to ‘ITC Limited’

Products and business nature

The company is in the business of Cigarette (Gold Flake, Classic, Duke, Royal, Ice Burst), Foods (Aashirvaad, B Natural, Yipee), Personal Care (Fiama Di Wills, Vivel, Savlon, Engage), Stationery & paperboard(Classmate), Agarbattis (Mangaldeep), Hotels (ITC Hotels).

Financial Analysis of Sep 2019 Results

FMCG Giant ITC limited on 24 Oct 2019 reported a 36.16% YoY jump in its standalone net profit at ₹ 4023.1 Cr. for the qtr ending 30 Sep 2019 vs Rs. 2954.67 Cr in same period last year.

Cigratte EBIT increases 7.41% YoY to Rs. 3844.45 Cr vs Rs. 3579.07 Cr in same period last year.

Cigratte revenue increases 6% YoY to Rs. 5326.83 Cr vs Rs. 5020.06 Cr in same period last year.

Revenue from operations increases 5.31% to Rs. 11871.5 Cr YoY vs Rs. 11272.51 Cr in same period last year.

EBITDA came at Rs. 4562.4Cr. and EBITDA margin at 38.4%

The earning beats the market estimates.

Peer Comparison :

Company Name Market Cap(Cr.) Revenue(Cr.) P/E Ratio
ITC Limited          3,07,653.71         47,011.58         22.15
Hindustan Unilever          4,63,215.66         39,469.00         70.34
Dabur India              83,096.18           8,725.66         56.29
Indian Hotels Company              18,136.19           4,552.30         65.42
Godrey Philips India                5,626.52           2,824.88         18.81

Looking at the P/E Ratio of ITC limited vs his peer companies ITC limited is available at very attractive valuations, company is also increasing rapidly and focusing of diversification and long term growth business models.

Recommendation: BUY for Long Term

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