ITC Limited's intrinsic value using Intellectual Capital analysis

ITC Limited

BSE : 500875

|

NSE : ITC

Industry : Cigarettes

|

ISIN : INE154A01025

|

FreeFloat : 70.00%

|

FnO : Yes

|

LotSize : 3200

BSE SENSEX | BSE SENSEX 50 | Nifty 50 | Nifty50 Equal Weight | BSE 100 | BSE 100 Largecap TMC | BSE 200 | BSE 250 LargeMidcap | BSE Largecap | BSE LargeMidcap | Nifty 100 | Nifty 200 | Nifty LargeMidcap 250 | Nifty100 Equal Weight | Nifty Alpha Quality Low Volatility 30 | Nifty Alpha Quality Value Low Voltlty 30 | Nifty Quality Low Volatility 30 | Nifty FMCG | BSE Dividend Stability | Nifty Dividend Opp 50 | Nifty Growth Sectors 15 | Nifty Low Volatility 50 | Nifty100 Low Volatility 30 | Nifty100 Quality 30 | Nifty200 Quality 30 | Nifty50 Value 20 | BSE CARBONEX | BSE Bharat 22 | BSE India Manufacturing | Nifty India Consumption

Intellectual Capital (IC)	108,595.70
Net Worth (NW)	59,556.76
Intrinsic Worth (IW)	168,152.50
Market Cap (MC)	211,277.50
Economic Value Added	1,417.30

Discount Rate	%
Liquidity Premium	%

Knowledge Basis (IC/IW)	64.58%
IC Gross Margin (EBITDA/IC)	17.53%
IC Net Margin (NPT/IC)	12.62%
Knowledge Turnover (Sales/IC)	0.48
Market to Intrinsic Value (MC/IW)	1.26

As Of	Intrinsic Value	Market Price
30 Sep 2020	Rs. 136.65	Rs. 171.70
22 Jan 2021	-	Rs. 210.70

Fundamental - medium term		Technical - near term		Combined outlook
EVA > 0 : Yes	Buy	10 DMA : Rs. 213.29	Sell	Avoid
KB > 50% : Yes		50 DMA : Rs. 204.49
0 < M2IV < 1 : No		Vol-Price trend : Falling

Question 3 - Is this stock undervalued?

Question 2 - Does this business have significant knowledge assets?

Question 1 - Is this business generating enough profits to cover its cost of capital?

* EVA is a registered trademark of Stern Stewart and Co.

Quarterly Results (Rs. Cr)

Quarter

Type*

Sales

Income

EBITDA

EBIT

PBT

PAT

NPT

Dec-17
S
9952.19
10579.11
4944.32
4653.57
4629.55
3090.20
3177.06

Mar-18
S
10813.24
11329.74
4660.51
4356.52
4333.28
2932.71
3100.41

Jun-18
C
11881.87
12306.15
4542.27
4222.15
4638.53
3049.38
2974.56

Sep-18
C
12184.28
12658.65
4426.56
4077.28
4529.46
3045.07
3003.99

Dec-18
C
11074.34
11659.37
4605.29
4248.86
4828.19
3136.95
3078.67

Mar-19
C
13212.19
13902.30
4832.24
4461.46
5141.94
3592.80
3535.11

Jun-19
C
12657.90
13305.19
4937.75
4558.81
5191.52
3436.51
3355.01

Sep-19
C
12867.39
13497.27
4842.06
4426.22
5042.11
4173.72
4119.16

Dec-19
C
13307.54
13960.50
4976.73
4539.83
5049.25
4047.87
3975.54

Mar-20
C
12560.64
13228.40
5171.38
4758.15
4743.47
3926.72
3119.91

Jun-20
C
10478.46
11403.59
3870.69
3451.70
3435.88
2562.73
2576.16

Sep-20
C
13147.81
13730.06
4983.25
4578.65
4565.38
3413.44
3412.46

* C - Consolidated, S - Standalone