Sure, but what’s highlighted in the picture is PAT Margin.
ITC FMCG PAT margin is currently like 4.5% (I would argue standalone economic margins would be lower)
6% EBIT Margin currently – assume no interest expense and a 25% tax gives you a 4.5% PAT margin.
They don’t have interest expense because the parent is funding with tobacco cashflow – so economic margins are lower because the growth is not self-funded (not so far anyway)
From your graphic,
In the 1992-2001 period – they grew sales at 22.5%
2.5x PAT margins and increased ROE from 30% to 54%
Assuming 7% inflation, ITC’s 18k crore (FMCG Revenue) is where HUL was in 1992-1993. HUL then did a 7% PAT Margin, 50% ROCE and 35% ROE.
I think he’ll be okay given he’s definitely getting a big raise this year.
Sharing stock performance of all the stocks mentioned in the article for 5 and 10 years. Compensation should be commensurate with TSR.
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