ITC Limited — Equity Research & DCF
A formula-driven analysis of ITC using a five-year FCFF DCF, reconciled segment forecasts, a transparent valuation bridge, WACC/terminal-growth sensitivity and exploratory econometrics.
Model reference: September 2026 · Currency: Indian rupees per share · Scenario outputs are illustrative
DCF sensitivity at 4.5% terminal growth
₹ per share · illustrative
Historical basis
FY26 D&A is ₹1,710.53 crore, FY26 PAT attributable to owners is ₹20,689.47 crore, FY26 inventory is ₹18,622.96 crore, and FY26 net working capital is ₹16,906.27 crore under the model’s stated definition of inventory + receivables − payables.
Forecast construction
The model starts from FY26 segment revenue and PBIT, forecasts each segment separately, applies an explicit intersegment-revenue elimination, adds other operating revenue and bridges segment PBIT to consolidated operating EBIT. Consolidated revenue rises from ₹89,913.33 crore in FY26A to ₹125,390.2 crore in FY31E in the central scenario.
Valuation
At 9.5% WACC and 4.5% terminal growth, the central illustrative DCF is ₹362.8 per share. The valuation bridge uses ₹21,360.4 crore of net liquid financial assets and ₹5,288.2 crore of equity-accounted investments at carrying value. Against the retained ₹263.50 portfolio reference price, the mathematical gap is 37.7%; it is not presented as a price target or recommendation.
Econometric work
The regression uses 64 supplied monthly ITC/NIFTY return observations from May 2021 to August 2026. The RBI policy-rate series uses the published change dates: 6.50% from February 2023, 6.00% from April 2025 and 5.50% from June 2025. September 2026 is excluded because the report date falls within the month.
The regression gives a repo coefficient of 0.1123, NIFTY coefficient of 0.9513 and R² of 0.3682 using HC1 robust covariance and normal-approximation p-values. It is exploratory association analysis, not a causal estimate. The supplied return observations themselves are not independently certified because the underlying price observations, adjustment factors and extraction timestamps were not supplied.
Current operating context
ITC's 31 July 2026 Q1 FY27 statement reported consolidated FMCG segment revenue growth of 15% YoY and segment results growth of 22%, while consolidated EBITDA and PAT before exceptional items were lower by 24% and 23% YoY. The forecast therefore does not mechanically extrapolate the quarter's profitability decline and instead embeds an explicit margin-recovery assumption.
Sources & methodology
- ITC quarterly results.
- ITC Q1 FY27 media statement.
- RBI February 2023 MPC statement.
- RBI April 2025 statement.
- RBI June 2025 rate circular.
Downloads
The PDF contains the analysis. The Excel workbook contains live formulas, editable assumptions, a reconciled segment forecast, DCF, valuation adjustments, regression dataset and source notes.
Disclosure: Independent portfolio research for educational purposes. This is not investment advice. Forecasts and valuations are assumption-sensitive.