ITC (NSE:ITC) Interest Coverage : 444.44 (As of Dec. 2023)

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What is ITC Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. ITC's Operating Income for the three months ended in Dec. 2023 was ₹60,444 Mil. ITC's Interest Expense for the three months ended in Dec. 2023 was ₹-136 Mil. ITC's interest coverage for the quarter that ended in Dec. 2023 was 444.44. The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies' interest coverage to be at least 5. ITC Ltd has enough cash to cover all of its debt. Its financial situation is stable.

The historical rank and industry rank for ITC's Interest Coverage or its related term are showing as below:

NSE:ITC' s Interest Coverage Range Over the Past 10 Years
Min: 170 Med: 361.95 Max: 1985.54
Current: 537.71

NSE:ITC's Interest Coverage is ranked better than
80.65% of 31 companies
in the Tobacco Products industry
Industry Median: 12.84 vs NSE:ITC: 537.71

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

ITC Interest Coverage Historical Data

The historical data trend for ITC's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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ITC Interest Coverage Chart

ITC Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Interest Coverage

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377.75

323.73

346.14

480.07

553.16

ITC Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage	Get a 7-Day Free Trial															679.43	510.57	629.05	608.02	444.44

Competitive Comparison of ITC's Interest Coverage

For the Tobacco subindustry, ITC's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

ITC's Interest Coverage Distribution in the Tobacco Products Industry

For the Tobacco Products industry and Consumer Defensive sector, ITC's Interest Coverage distribution charts can be found below:

* The bar in red indicates where ITC's Interest Coverage falls into.

ITC Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

ITC's Interest Coverage for the fiscal year that ended in Mar. 2023 is calculated as

Here, for the fiscal year that ended in Mar. 2023, ITC's Interest Expense was ₹-432 Mil. Its Operating Income was ₹238,967 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹2,169 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Mar. 2023 )	/	Interest Expense (A: Mar. 2023 )
	=	-1	*	238967	/	-432
	=	553.16

ITC's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, ITC's Interest Expense was ₹-136 Mil. Its Operating Income was ₹60,444 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹0 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	60443.7	/	-136
	=	444.44

The higher the ratio, the stronger the company's Financial Strength is.

ITC (NSE:ITC) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

ITC Interest Coverage Related Terms

Thank you for viewing the detailed overview of ITC's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

ITC (NSE:ITC) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Tobacco Products » ITC Ltd (NSE:ITC) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

500875:India

Address

37 Jawaharlal Nehru Road, Virginia House, Kolkata, WB, IND, 700 071

Website

https://www.itcportal.com

ITC Ltd is an Indian conglomerate that primarily operates in the consumer goods space, particularly cigarettes. The company operates in four main business segments: Fast Moving Consumer Goods; Hotels; Paperboards, Paper, and Packaging; and Agri-Business. Roughly three-quarters of the company's total revenue comes from the Fast Moving Consumer Goods Business, which is dominated by cigarettes but also includes branded packaged foods, personal care products, and other categories. The company generates the vast majority of its revenue in India.