ITC Analyst Meet Highlights: Dolat Capital

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Dolat Capital Report.Cigarette Business In India, per capital consumption of cigarettes is one of the lowest in the world. The legal cigarette accounts for mere 9% of total tobacco consumption in India, which translates to ~80% of tax revenue. Other forms of tobacco including bidis, smokeless and illicit cigarettes account for 1/3rd of legal cigarettes.Illicit cigarette remains a significant challenge for the company. The cigarette industry in India had witnessed sharp increase in tax incidence from 2013-20, as a result of which volume saw a drop of ~20%. However, since FY22 onwards as the taxes remained relatively stable, which lead to in claw back of illicit trade. Going ahead, the focus remains on maximizing cigarette potential within the tobacco basket, reinforcing market standing and towards portfolio intervention in differentiated formats to counter illicit..Increased Share of Non-Cigarette Business Over the years, ITC has diversified from traditional business of cigarettes to non-cigarettes (fmcg, agri, paper and hotels) to drive profitable and capital efficient growth. Through which over last 10 years, the non-cigarette business has witnessed revenue/profit before tax growth of 2.5/3.2 times and the return on capital employed has improved by ~730 bps over the same period..FMCG – Foods Business As per Nielsen, ITC is India’s fastest growing food company with Sunfeast and Bingo amongst top 10 brands. The company launched 300 products over last three years. Moreover, it has grown to three times of their revenues in past 10 years..Click on the attachment to read the full report:.ITC - Earning Visibility Continues To Drive Performance: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

ITC Analyst Meet Highlights: Dolat Capital

The new launches in the cigarette segment has increased five times over the last five years and account for ~17% of overall volumes.

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