Assessment of financial position and performance of the Indian Tobacco Company.

Vaibhav Bhalala

Bachelor's thesis

Abstract:

Before making any choice regarding an investment, it is essential for a person to have a solid understanding of the actual financial state of the company being considered. Since a growing number of businesses are falling into insolvency and a growing number of businesses are turning to fraudulent business practises by altering the amounts on their balance sheet to entice additional investments. As a result, the thesis incorporates an analysis of Indian Tobacco Company's financial position as well as its financial performance. This was done with the intention of assisting investors in gaining a better understanding of the company's financials. To conducting an analysis of ITC's financials, vertical analysis, horizontal analysis, ratio analysis, and z-score analysis are conducted. The analysis makes use of secondary data that has been extracted from annual reports of the company over a period of five years, beginning in 2017–2018 and continuing through 2021–2022. The findings indicated that there have been significant shifts regarding the other expenses, as well as the property, plant, and machinery. The contribution of total expenses and revenue from operations makes a significant impact on the profit made by the company. The company needs to place a greater emphasis on effectively managing its inventory, and in tandem with this, it should ensure that its resources are allocated appropriately. This will ensure that all its assets are used, which will result in an increase in revenue. According to the findings of the z-score analysis, ITC has consistently reported z-scores above 2.99 over the past five years. This can be interpreted thar, it is risk-free for shareholders to invest in the company, and the company will not fail to meet its financial commitments

Keywords

Financial analysis, FMCG Industry, ITC, Ratio analysis, Vertical analysis, Horizontal analysis, Altman z-score analysis

Language used: English

Date on which the thesis was submitted / produced: 19. 3. 2023

Thesis defence

• Date of defence: 15. 5. 2023
• Supervisor: Ing. Jiří Mach, Ph.D.
• Reader: Pavel Kotyza, Ph.D.

Czech University of Life Sciences Prague

Faculty of Economics and Management

Bachelor programme:
Business Administration