Annexure to the Report of the Board of Directors

For the Financial Year Ended 31st March, 2024

KEY FINANCIAL RATIOS

[Pursuant to Schedule V(B) to the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015]

Key Financial Ratios for the Company:

FY24 FY23

(i) Operating Profit Margin ( ) 38.0 35.6

(ii) Net Profit Margin ( )1 29.4 26.9

(iii) Debtors Turnover 24.7 32.5

(iv) Inventory Turnover 6.0 6.7

(v) Current Ratio 2.9 2.8

(vi) Return on Net orth ( )1 29.2 29.0

Notes:

1. Net Profit Margin and Return on Net Worth ratios have been computed based on Profit After Tax
(before exceptional items).
2. Interest Coverage Ratio and Debt-Equity ratio are not relevant for the Company as it has negligible debt.

On behalf of the Board

S. PURI Chairman & Managing Director

(DIN : 00280529)

Kolkata S. D TTA Director & Chief Financial Officer

23rd May, 2024 (DIN : 01804345)

ITC Limited REPORT AND ACCOUNTS 2024 161

Annexure to the Report of the Board of Directors
Independent Auditor’s Report on compliance with the conditions of Corporate Governance as per provisions
of Chapter IV of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended
The Members of ITC Limited

1. The Corporate overnance Report prepared by ITC Limited (hereinafter the Company ), contains details as specified in regulations 17 to 27, clauses (b) to
(i) and (t) of sub – regulation (2) of regulation 46 and para C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015, as amended (“the Listing Regulations”) (‘Applicable criteria’) for the year ended March 31, 2024, and the said
Report will be submitted by the Company to the Stock Exchanges as part of the Annual Report.
Management’s Responsibility
2. The preparation of the Corporate Governance Report is the responsibility of the Management of the Company including the preparation and maintenance of
all relevant supporting records and documents. This responsibility also includes the design, implementation and maintenance of internal control relevant to the
preparation and presentation of the Corporate Governance Report.
3. The Management along with the Board of Directors are also responsible for ensuring that the Company complies with the conditions of Corporate Governance
as stipulated in the Listing Regulations, issued by the Securities and Exchange Board of India.
Auditor’s Responsibility
4. Pursuant to the requirements of the Listing Regulations, our responsibility is to provide a reasonable assurance in the form of an opinion whether, the Company
has complied with the conditions of Corporate overnance as specified in the Listing Regulations.
5. e conducted our examination of the Corporate overnance Report in accordance with the uidance Note on Reports or Certificates for Special Purposes
and the uidance Note on Certification of Corporate overnance, both issued by the Institute of Chartered Accountants of India ( ICAI ). The uidance Note
on Reports or Certificates for Special Purposes requires that we comply with the ethical requirements of the Code of Ethics issued by ICAI.
6. We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1, Quality Control for Firms that Perform Audits and
Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements.
7. The procedures selected depend on the auditor’s judgement, including the assessment of the risks associated in compliance of the Corporate Governance
Report with the applicable criteria. Summary of procedures performed include:
i. Read and understood the information prepared by the Company and included in its Corporate Governance Report;
ii. Obtained and verified that the composition of the oard of Directors with respect to executive and non-executive directors has been met throughout the
reporting period;
iii. Obtained and read the Register of Directors as on March 31, 2024 and verified that atleast one independent woman director was on the oard of Directors
throughout the year;
iv. Obtained and read the minutes of the following committee meetings / other meetings held from April 01, 2023 to March 31, 2024:
(a) Board of Directors;
(b) Audit Committee;
(c) Annual General Meeting (AGM);
(d) Nomination and Remuneration Committee;
(e) Stakeholders Relationship Committee;
(f) Risk Management Committee
v. Obtained necessary declarations from the directors of the Company.
vi. Obtained and read the policy adopted by the Company for related party transactions.
vii. Obtained the schedule of related party transactions during the year and balances at the year-end.
viii. Obtained and read the minutes of the audit committee meeting wherein such related party transactions have been pre-approved by the audit committee.
ix. Performed necessary inquiries with the management and also obtained necessary specific representations from management.
. The above-mentioned procedures include examining evidence supporting the particulars in the Corporate overnance Report on a test basis. Further, our
scope of work under this report did not involve us performing audit tests for the purposes of expressing an opinion on the fairness or accuracy of any of the
financial information or the financial statements of the Company ta en as a whole.
Opinion
9. Based on the procedures performed by us, as referred in paragraph 7 above, and according to the information and explanations given to us, we are of the
opinion that the Company has complied with the conditions of Corporate overnance as specified in the Listing Regulations, as applicable for the year ended
March 31, 2024, referred to in paragraph 4 above.
Other matters and Restriction on Use
10. This report is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the
affairs of the Company.
11. This report is addressed to and provided to the members of the Company solely for the purpose of enabling it to comply with its obligations under the
Listing Regulations with reference to compliance with the relevant regulations of Corporate Governance and should not be used by any other person or for
any other purpose. Accordingly, we do not accept or assume any liability or any duty of care or for any other purpose or to any other party to whom it is shown
or into whose hands it may come without our prior consent in writing. We have no responsibility to update this report for events and circumstances occurring
after the date of this report.
For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Arvind Sethi
Partner
Place of Signature: Kolkata Membership Number: 89802
Date: May 23, 2024 UDIN: 24089802BKEJFG7178

162 ITC Limited REPORT AND ACCOUNTS 2024

 CEO and CFO Compliance Certificate

e, S. Puri, Chairman Managing Director and S. Dutta, Director Chief Financial Officer
certify that :
a) We have reviewed the Financial Statements including the Cash Flow Statement for the
year ended 31st March, 2024 and to the best of our knowledge and belief :
i) these Statements do not contain any materially untrue statement or omit any material
fact or contain statements that might be misleading;
ii) these Statements together present a true and fair view of the Company’s affairs
and are in compliance with the Indian Accounting Standards, applicable laws and
regulations.
b) To the best of our knowledge and belief, no transactions entered into by the Company
during the year ended 31st March, 2024 are fraudulent, illegal or violative of the
ITC Code of Conduct.
c) e accept responsibility for establishing and maintaining internal controls for financial
reporting and we have evaluated the effectiveness of internal control systems of the
Company pertaining to financial reporting. Deficiencies in the design or operation of such
internal controls, if any, of which we are aware have been disclosed to the Auditors and
the Audit Committee and steps have been ta en to rectify these deficiencies.
d) i) There has not been any significant change in the internal controls over financial
reporting during the year under reference;
ii) There has not been any significant change in the accounting policies during the year
requiring disclosure in the notes to the Financial Statements; and
iii) e are not aware of any instance during the year of significant fraud with
involvement therein of the management or any employee having a significant role in
the Company’s internal control systems over financial reporting.

S. DUTTA Director & Chief Financial Officer

(DIN : 01804345)
Kolkata, India S. PURI Chairman & Managing Director
May 20, 2024 (DIN : 00280529)

ITC Limited REPORT AND ACCOUNTS 2024 163

Standalone Balance Sheet as at 31st March, 2024
As at As at
Note 31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)
ASSETS
Non-current assets
(a) Property, Plant and Equipment 3A 22015.50 20491.32
(b) Capital work-in-progress 3B 1077.97 1681.47
(c) Investment Property 3C 373.09 352.26
(d) Goodwill 3D 577.20 577.20
(e) Other Intangible assets 3E 2055.74 2037.42
(f) Intangible assets under development 3F 9.07 15.13
(g) Right-of-use assets 3G 721.69 715.91
(h) Financial Assets
(i) Investments 4 22821.94 16363.55
(ii) Loans 5 2.63 4.07
(iii) Others 6 372.88 23197.45 3608.23 19975.85
(i) Other non-current assets 7 1229.22 51256.93 1211.74 47058.30
Current assets
(a) Inventories 8 12631.51 10593.90
(b) Financial Assets
(i) Investments 9 11916.88 16357.07
(ii) Trade receivables 10 3311.45 2321.33
(iii) Cash and cash equivalents 11 197.63 206.88
(iv) Other Bank Balances 12 6020.06 3624.38
(v) Loans 5 9.10 5.95
(vi) Others 6 849.86 22304.98 705.84 23221.45
(c) Other current assets 7 1134.18 36070.67 1388.09 35203.44
TOTAL ASSETS 87327.60 82261.74
EQUITY AND LIABILITIES
Equity
(a) Equity Share capital 13 1248.47 1242.80
(b) Other Equity 70984.83 72233.30 66351.00 67593.80
Liabilities
Non-current liabilities
(a) Financial Liabilities
(i) Borrowings 14 1.76 3.28
(ii) Lease liabilities 15 261.95 273.59
(iii) Other financial liabilities 16 109.87 373.58 152.49 429.36
(b) Provisions 17 221.45 201.83
(c) Deferred tax liabilities (Net) 18 2083.66 2678.69 1621.13 2252.32
Current liabilities
(a) Financial Liabilities
(i) Borrowings 14 1.52 1.26
(ii) Lease liabilities 15 46.74 46.54
(iii) Trade payables
Total outstanding dues of micro enterprises
and small enterprises 206.85 137.50
Total outstanding dues of creditors other than
micro enterprises and small enterprises 4282.70 4213.76
(iv) Other financial liabilities 16 1659.33 6197.14 1730.68 6129.74
(b) Other current liabilities 19 5389.75 5446.16
(c) Provisions 17 68.72 63.59
(d) Current Tax Liabilities (Net) 20 760.00 12415.61 776.13 12415.62
TOTAL EQUITY AND LIABILITIES 87327.60 82261.74

The accompanying notes 1 to 31 are an integral part of the Standalone Financial Statements.
On behalf of the Board
In terms of our report attached
For S R B C & CO LLP S. PURI Chairman & Managing Director
Chartered Accountants (DIN : 00280529)
Firm Registration Number: 324982E / E300003 S. DUTTA Director & Chief Financial Officer
Arvind Sethi (DIN : 01804345)
Partner R. K. SINGHI Company Secretary
(Membership No.: 89802) (Membership No.: FCS 3770)
Kolkata, May 23, 2024

164 ITC Limited REPORT AND ACCOUNTS 2024

Standalone Statement of Profit and Loss for the year ended 31st March, 2024
For the year ended For the year ended
Note 31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

I Revenue From Operations 21A, 21B 70105.29 70251.28

II Other Income 22 3538.28 2437.61
III Total Income (I+II) 73643.57 72688.89
IV EXPENSES
Cost of materials consumed 21309.84 19809.83
Purchases of Stock-in-Trade 6042.97 9109.85
Changes in inventories of finished goods, Stock-in-Trade,
work-in-progress and intermediates 23 (370.71) (39.50)
Excise duty 4664.48 4208.01
Employee benefits expense 24 3732.23 3569.46
Finance costs 25 45.73 41.81
Depreciation and amortization expense 1647.82 1662.73
Other expenses 26 10247.87 9649.16
Total expenses (IV) 47320.23 48011.35
V Profit before exceptional items and tax (III-IV) 26323.34 24677.54
VI Exceptional Items 28(i) (7.57) 72.87
VII Profit before tax (V+VI) 26315.77 24750.41
VIII Tax expense:
Current Tax 27 5661.21 6025.32
Deferred Tax 27 232.59 (28.22)
IX Profit for the year (VII-VIII) 20421.97 18753.31
Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss:
– Remeasurements of the defined benefit plans 28(vi) (22.97) (21.81)
– Equity instruments through other comprehensive
income 2515.06 91.90
– Effective portion of gains / (losses) on designated
portion of hedging instruments in a cash flow hedge (10.46) 21.22
(ii) Income tax relating to items that will not be reclassified
to profit or loss 27 (228.72) (0.34)
B (i) Items that will be reclassified to profit or loss:
– Debt instruments through other comprehensive
income 17.91 (35.01)
– Effective portion of gains / (losses) on designated
portion of hedging instruments in a cash flow hedge 19.71 (47.45)
(ii) Income tax relating to items that will be reclassified to
profit or loss 27 (9.47) 20.75
X Other Comprehensive Income [A (i+ii) + B (i+ii)] 2281.06 29.26
XI Total Comprehensive Income for the year (IX+X) 22703.03 18782.57
XII Earnings per equity share (Face Value ` 1.00 each): 28(ii)
(1) Basic (in `) 16.39 15.15
(2) Diluted (in `) 16.35 15.11

The accompanying notes 1 to 31 are an integral part of the Standalone Financial Statements.
On behalf of the Board
In terms of our report attached
For S R B C & CO LLP S. PURI Chairman & Managing Director
Chartered Accountants (DIN : 00280529)
Firm Registration Number: 324982E / E300003 S. DUTTA Director & Chief Financial Officer
Arvind Sethi (DIN : 01804345)
Partner R. K. SINGHI Company Secretary
(Membership No.: 89802) (Membership No.: FCS 3770)
Kolkata, May 23, 2024

ITC Limited REPORT AND ACCOUNTS 2024 165

 Standalone Statement of Changes in Equity for the year ended 31st March, 2024
166
ITC Limited

A. Equity Share Capital (` in Crores)

Balance at the beginning Changes in equity share Balance at the end of the
of the reporting year capital during the year reporting year

For the year ended 31st March, 2024 1242.80 5.67 1248.47
REPORT AND ACCOUNTS 2024

For the year ended 31st March, 2023 1232.33 10.48 1242.80

B. Other Equity (` in Crores)

Reserves and Surplus Items of Other Comprehensive Income

Debt Equity
Share Instruments Instruments Effective Foreign Total
Options Capital through Other through Other portion of Currency
Capital Securities Outstanding Redemption Contingency General Retained Comprehensive Comprehensive Cash Flow Translation
Reserve Premium Account Reserve Reserve Reserve Earnings Income Income Hedges Reserve

Balance as at 1st April, 2023 2.48 13065.62 741.45 0.30 363.05 17585.31 33687.70 (23.42) 885.48 2.48 40.55 66351.00
Profit for the year – – – – – – 20421.97 – – – – 20421.97
Other Comprehensive Income (net of tax) – – – – – – (17.18) 13.40 2277.92 6.92 – 2281.06
Total Comprehensive Income for the year – – – – – – 20404.79 13.40 2277.92 6.92 – 22703.03
Issue of equity shares under ITC Employee
Stock Option Schemes – 1437.16 – – – – – – – – – 1437.16
Dividends
– Final Dividend (2022-23 - ` 6.75 per share) – – – - – – (8388.91) – – – – (8388.91)
– Special Dividend (2022-23 - ` 2.75 per share) – – – – – – (3417.70) – – – – (3417.70)
– Interim Dividend (2023-24 - ` 6.25 per share) – – – – – – (7799.45) – – – – (7799.45)
Dividend distribution tax refund received – – – – – – – – – – – –
Transfer from Share Options Outstanding
Account on exercise and lapse – 340.00 (342.50) – – – 1.67 – – – – (0.83)
Transferred to initial carrying amount of hedged
items (net of tax) – – – – – – – – – (8.11) – (8.11)
Recognition of share based payment – – 108.64 – – – – – – – – 108.64
Balance as at 31st March, 2024 2.48 14842.78 507.59 0.30 363.05 17585.31 34488.10 (10.02) 3163.40 1.29 40.55 70984.83
Balance as at 1st April, 2022 2.48 9988.14 1316.33 0.30 363.05 17585.31 30060.39 2.78 793.58 14.33 40.55 60167.24
Profit for the year – – – – – – 18753.31 – – – – 18753.31
Other Comprehensive Income (net of tax) – – – – – – (16.81) (26.20) 91.90 (19.63) – 29.26
Total Comprehensive Income for the year – – – – – – 18736.50 (26.20) 91.90 (19.63) – 18782.57
Issue of equity shares under ITC Employee
Stock Option Schemes – 2466.92 – – – – – – – – – 2466.92
 Standalone Statement of Changes in Equity for the year ended 31st March, 2024
B. Other Equity (Contd.) (` in Crores)
Reserves and Surplus Items of Other Comprehensive Income

Debt Equity
Share Instruments Instruments Effective Foreign Total
Options Capital through Other through Other portion of Currency
Capital Securities Outstanding Redemption Contingency General Retained Comprehensive Comprehensive Cash Flow Translation
Reserve Premium Account Reserve Reserve Reserve Earnings Income Income Hedges Reserve

Dividends
– Final Dividend (2021-22 - ` 6.25 per share) – – – – – – (7702.03) – – – – (7702.03)
– Interim Dividend (2022-23 - ` 6.00 per share) – – – – – – (7448.41) – – – – (7448.41)
Dividend distribution tax refund received – – – – – – 20.43 – – – – 20.43
Transfer from Share Options Outstanding
Account on exercise and lapse – 610.56 (635.99) – – – 20.82 – – – – (4.61)
Transferred to initial carrying amount of hedged
items (net of tax) – – – – – – – – – 7.78 – 7.78
Recognition of share based payment – – 61.11 – – – – – – – – 61.11
Balance as at 31st March, 2023 2.48 13065.62 741.45 0.30 363.05 17585.31 33687.70 (23.42) 885.48 2.48 40.55 66351.00

The Board of Directors of the Company have recommended Final Dividend of ` 7.50 per Ordinary Share of ` 1/- each for the financial year ended 31st March, 2024 (previous year: Final Dividend ` 6.75 per Ordinary Share and Special Dividend of
` 2.75 per Ordinary Share) to be paid on fully paid Equity Shares amounting to ` 9363.54 Crores. The said Final Dividend is subject to the approval of the shareholders at the Annual General Meeting and has not been included as a liability in these
financial statements.
Together with the Interim Dividend of ` 6.25 per Ordinary Share (previous year: ` 6.00 per Ordinary Share) paid on 27th February, 2024, the total Equity Dividend for the financial year ended 31st March, 2024 is ` 13.75 per Ordinary Share
(previous year: ` 12.75 per Ordinary Share and Special Dividend of ` 2.75 per Ordinary Share).
Capital Reserve: This Reserve represents the difference between value of the net assets transferred to the Company in the course of business combinations and the consideration paid for such combinations.
Securities Premium: This Reserve represents the premium on issue of shares and can be utilized in accordance with the provisions of the Companies Act, 2013.
Share Options Outstanding Account: This Reserve relates to stock options granted by the Company to employees under ITC Employee Stock Option Schemes. This Reserve is transferred to Securities Premium or Retained Earnings on exercise
ITC Limited

or lapse of vested options.

Capital Redemption Reserve: This Reserve has been transferred to the Company in the course of business combinations and can be utilized in accordance with the provisions of the Companies Act, 2013.
Contingency Reserve: This Reserve has been created out of Retained Earnings, as a matter of prudence, to take care of any unforeseen adverse developments in pending legal disputes.
General Reserve: This Reserve has been created by an appropriation from one component of equity (generally Retained Earnings) to another, not being an item of Other Comprehensive Income. The same can be utilized in accordance with the
provisions of the Companies Act, 2013.
Retained Earnings: This Reserve represents the cumulative profits of the Company and effects of remeasurement of defined benefit obligations. This Reserve can be utilized in accordance with the provisions of the Companies Act, 2013.
Debt Instruments through Other Comprehensive Income: This Reserve represents the cumulative gains (net of losses) arising on revaluation of Debt Instruments measured at Fair Value through Other Comprehensive Income, net of amounts
reclassified, if any, to profit or loss when those instruments are disposed of.
REPORT AND ACCOUNTS 2024

Equity Instruments through Other Comprehensive Income: This Reserve represents the cumulative gains (net of losses) arising on revaluation of Equity Instruments measured at Fair Value through Other Comprehensive Income, net of amounts
reclassified, if any, to Retained Earnings when those instruments are disposed of.
Effective portion of Cash Flow Hedges: This Reserve represents the cumulative effective portion of changes in Fair Value of hedging instrument that are designated as Cash Flow Hedges. It will be reclassified to profit or loss or included in the
carrying amount of the non-financial asset in accordance with the Company’s accounting policy.
Foreign Currency Translation Reserve: This Reserve contains the accumulated balance of foreign exchange differences arising on monetary items that, in substance, form part of the Company’s net investment in a foreign operation whose
functional currency is other than Indian Rupee. Exchange differences previously accumulated in this Reserve are reclassified to profit or loss on disposal of the foreign operation.
The accompanying notes 1 to 31 are an integral part of the Standalone Financial Statements.
On behalf of the Board
In terms of our report attached
For S R B C & CO LLP S. PURI Chairman & Managing Director
Chartered Accountants (DIN : 00280529)
Firm Registration Number: 324982E / E300003 S. DUTTA Director & Chief Financial Officer
Arvind Sethi (DIN : 01804345)
Partner R. K. SINGHI Company Secretary
167

(Membership No.: 89802) (Membership No.: FCS 3770)

Kolkata, May 23, 2024
Standalone Statement of Cash Flows for the year ended 31st March, 2024
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)
A. Cash Flow from Operating Activities
PROFIT BEFORE TAX 26315.77 24750.41
ADJUSTMENTS FOR:
Depreciation and amortization expense 1647.82 1662.73
Share based payments to employees 103.10 58.50
Finance costs 45.73 41.81
Interest Income (1592.41) (1434.53)
Dividend Income (990.35) (556.90)
(Gain) / Loss on sale of property, plant and equipment,
lease termination - Net (54.07) 4.53
Inventory write-offs / write-downs (net of reversals) 149.62 155.46
Doubtful and bad debts 9.23 (0.93)
Doubtful and bad advances, loans and deposits 25.03 1.16
Impairment of investment in joint venture – 8.50
Gain recognised on divestment of shares held in joint venture (9.49) –
Net gain arising on financial instruments measured at amortised
cost / mandatorily measured at fair value through profit or loss (784.82) (416.74)
Foreign currency translations and transactions - Net (6.28) (1456.89) 37.89 (438.52)
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 24858.88 24311.89
ADJUSTMENTS FOR:
Trade receivables, advances and other assets (887.87) (603.25)
Inventories (2187.23) (751.59)
Trade payables, other liabilities and provisions 17.30 (3057.80) 755.24 (599.60)
CASH GENERATED FROM OPERATIONS 21801.08 23712.29
Income tax paid (net of refunds) (5682.85) (5800.59)
NET CASH FROM OPERATING ACTIVITIES 16118.23 17911.70
B. Cash Flow from Investing Activities
Purchase of property, plant and equipment, intangibles,
ROU asset etc. (2647.23) (1858.32)
Sale of property, plant and equipment 100.85 48.86
Purchase of current investments (64931.45) (72925.91)
Sale / redemption of current investments 67992.14 67720.51
Payment towards contingent purchase consideration – (63.75)
Investment in subsidiaries (1050.35) (1184.14)
Investment in associates* (86.26) (1.88)
Investment in joint venture (0.90) –
Purchase of non-current investments* (2745.51) (2349.41)
Sale / redemption of non-current investments 2622.86 4057.60
Redemption of investment in subsidiary – 18.00
Advance received towards divestment of shares held in joint venture
[Refer Note 28 (x)] – 56.00
Dividend received 990.35 556.90
Interest received 1016.53 1216.27
Investment in bank deposits
(original maturity more than 3 months) (3578.11) (7427.20)
Redemption / maturity of bank deposits
(original maturity more than 3 months) 4446.34 5476.33
Investment in deposit with housing finance company – (3500.00)
Redemption / maturity of deposit with housing finance company – 5000.00
Loans given (12.22) (8.21)
Loans realised 10.51 8.98
NET CASH FROM / (USED IN) INVESTING ACTIVITIES 2127.55 (5159.37)

168 ITC Limited REPORT AND ACCOUNTS 2024

Standalone Statement of Cash Flows for the year ended 31st March, 2024
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)
C. Cash Flow from Financing Activities
Proceeds from issue of share capital 1442.83 2477.39
Repayment of non-current borrowings (1.26) (0.74)
Principal payment of lease liabilities (56.64) (51.97)
Interest paid (46.02) (40.04)
Net increase in statutory restricted accounts balances 12.12 14.94
Dividend paid (19606.06) (15150.44)
Dividend distribution tax refund received – 20.43
NET CASH USED IN FINANCING ACTIVITIES (18255.03) (12730.43)
NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS (9.25) 21.90
OPENING CASH AND CASH EQUIVALENTS 206.88 184.98
CLOSING CASH AND CASH EQUIVALENTS 197.63 206.88

* Also refer Note 28(ix)

Notes:
1. The above Statement of Cash Flows has been prepared under the “Indirect Method” as set out in Ind AS - 7 “Statement of Cash Flows”

As at As at
2. CASH AND CASH EQUIVALENTS: 31st March, 2024 31st March, 2023
Cash and cash equivalents as above 197.63 206.88
Unrealised gain / (loss) on foreign currency cash and cash equivalents … …
Cash and cash equivalents (Note 11) 197.63 206.88
3. Net Cash Flow from Operating Activities includes an amount of ` 436.16 Crores (2023 - ` 328.80 Crores) spent towards Corporate
Social Responsibility.
4. Disclosure of change arising from financing activities in respect of lease liabilities - Refer Note 15

The accompanying notes 1 to 31 are an integral part of the Standalone Financial Statements.
On behalf of the Board
In terms of our report attached
For S R B C & CO LLP S. PURI Chairman & Managing Director
Chartered Accountants (DIN : 00280529)
Firm Registration Number: 324982E / E300003 S. DUTTA Director & Chief Financial Officer
Arvind Sethi (DIN : 01804345)
Partner R. K. SINGHI Company Secretary
(Membership No.: 89802) (Membership No.: FCS 3770)
Kolkata, May 23, 2024

ITC Limited REPORT AND ACCOUNTS 2024 169

Notes to the Standalone Financial Statements
Company Information
ITC Limited (the Company’) CIN: L16005 1 10PLC001 5 The Company is a diversified conglomerate with
is a public limited company domiciled in India with its businesses spanning Fast-Moving Consumer oods
registered office located at Virginia House, 37 awaharlal (Cigarettes Cigars, Foods, Personal Care Products,
Nehru Road, ol ata 700 071. The Company’s shares are Education Stationery Products, Safety Matches and
listed on the National Stoc Exchange of India Limited, Agarbattis), Hotels, Paperboards, Paper and Pac aging,
SE Limited and The Calcutta Stoc Exchange Limited. and Agri usiness.

1. Material Accounting Policies

Statement of Compliance of the revision and future periods if the revision affects both
These financial statements have been prepared in current and future periods.
accordance with Indian Accounting Standards (Ind AS) Operating Cycle
notified under Section 133 of the Companies Act, 2013 and
All assets and liabilities have been classified as current
amendments thereto. The financial statements have also
or non-current as per the Company’s normal operating
been prepared in accordance with the relevant presentation cycle and other criteria set out in the Schedule III to the
requirements of the Companies Act, 2013. The Company Companies Act, 2013 and Ind AS 1 Presentation of
adopted Ind AS from 1st April, 2016. Financial Statements based on the nature of products and
Basis of Preparation the time between the acquisition of assets for processing
and their realisation in cash and cash equivalents.
The financial statements are prepared in accordance with
The Company has identified twelve months as its
the historical cost convention, except for certain items that
operating cycle.
are measured at amortised cost or fair value, as explained
in the accounting policies. Property, Plant and Equipment
Fair Value is the price that would be received to sell an asset Property, plant and equipment (PP E) are stated at
or paid to transfer a liability in an orderly transaction between cost of acquisition or construction less accumulated
mar et participants at the measurement date, regardless of depreciation and accumulated impairment, if any.
whether that price is directly observable or estimated using For this purpose, cost includes deemed cost which
another valuation technique. In estimating the fair value of represents the carrying value of PP E recognised as
an asset or a liability, the Company ta es into account the at 1st April, 2015 measured as per the previous
characteristics of the asset or liability if mar et participants enerally Accepted Accounting Principles ( AAP).
would take those characteristics into account when pricing Cost is inclusive of inward freight, duties and taxes and
the asset or liability at the measurement date. Fair value for incidental expenses related to acquisition. In respect
measurement and / or disclosure purposes in these financial of ma or pro ects involving construction, related
statements is determined on such a basis, except for pre-operational expenses form part of the value of assets
share-based payment transactions that are within the scope capitalised. Expenses capitalised also include applicable
of Ind AS 102 Share-based Payment, leasing transactions borrowing costs for qualifying assets, if any. All upgradation /
that are within the scope of Ind AS 116 Leases, enhancements are charged off as revenue expenditure
and measurements that have some similarities to fair value unless they bring similar significant additional benefits.
but are not fair value, such as net realisable value in An item of PP E is derecognised upon disposal or when
Ind AS 2 Inventories or value in use in Ind AS 36 no future economic benefits are expected to arise from
Impairment of Assets. the continued use of asset. Any gain or loss arising on the
The preparation of financial statements in conformity disposal or retirement of an item of PP E is determined
with Ind AS requires management to ma e udgements, as the difference between the sales proceeds and
estimates and assumptions that affect the application of the the carrying amount of the asset and is recognised in
accounting policies and the reported amounts of assets and Statement of Profit and Loss.
liabilities, the disclosure of contingent assets and liabilities Depreciation of these assets commences when the assets
at the date of the financial statements, and the reported are ready for their intended use, which is generally on
amounts of revenues and expenses during the year. Actual commissioning. Items of PP E are depreciated in a manner
results could differ from those estimates. The estimates that amortizes the cost (or other amount substituted for
and underlying assumptions are reviewed on an ongoing cost) of the assets after commissioning, less its residual
basis. Revisions to accounting estimates are recognised value, over their useful lives as specified in Schedule II of
in the period in which the estimate is revised if the revision the Companies Act, 2013 on a straight-line basis. Land is
affects only that period they are recognised in the period not depreciated.

170 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

The estimated useful lives of PP E of the Company are as The carrying value of intangible assets includes deemed
follows: cost which represents the carrying value of intangible
assets recognised as at 1st April, 2015 measured as per
uildings 30-60 ears
the previous AAP.
Leasehold Improvements Shorter of lease period or After initial recognition, an intangible asset is carried at
estimated useful lives its cost less accumulated amortization and / or impairment
Plant and Equipment 3-25 ears losses.
Furniture and Fixtures -10 ears The useful life of an intangible asset is considered finite
where the rights to such assets are limited to a specified
Vehicles -10 ears
period of time by contract or law (e.g. patents, licences,
Office Equipment 5 ears trademar s, franchise and servicing rights) or the li elihood
of technical, technological obsolescence (e.g. computer
PP E’s residual values, useful lives and method of
software, design, prototypes) or commercial obsolescence
depreciation are reviewed at each alance Sheet date
(e.g. lesser known brands are those to which adequate
and changes, if any, are treated as changes in accounting
mar eting support may not be provided). If, there are no
estimate.
such limitations, the useful life is ta en to be indefinite.
Goodwill and Other Intangible Assets Intangible assets that have finite lives are amortized over
Goodwill their estimated useful lives by the straight-line method
oodwill arising on usiness Combination is carried at cost unless it is practical to reliably determine the pattern of
less any accumulated impairment losses. benefits arising from the asset. An intangible asset with
an indefinite useful life is not amortized. However, it is
oodwill is annually tested for impairment. Impairment
annually tested for impairment. Amortization expenses and
loss, if any, to the extent the carrying amount exceeds the
recoverable amount is charged off to the Statement of Profit impairment losses and reversal of impairment losses are
and Loss as it arises and is not reversed. For impairment included in the Depreciation and amortization expense’ in
testing, goodwill is allocated to Cash enerating nit (C ) the Statement of Profit and Loss.
or group of C s to which it relates, which is not larger The estimated useful lives of intangible assets of the
than an operating segment, and is monitored for internal Company with finite lives are as follows:
management purposes.
Trademar s / now 10 ears (unless shorter
On disposal of the C or group of C s, attributable
How, usiness and useful life is required based
amount of goodwill is included in the determination of the
Commercial Rights on contractual or legal terms)
profit or loss recognised in the Statement of Profit and Loss.
Computer Software 5 ears
Other Intangible Assets
Other Intangible Assets that the Company controls and from Customer Relationships ears
which it expects future economic benefits are capitalised
The useful lives of intangible assets are reviewed annually to
upon acquisition and measured initially:
determine if a reset of such useful life is required for assets
a. for assets acquired in a business combination, at fair with finite lives and to confirm that business circumstances
value on the date of acquisition. continue to support an indefinite useful life assessment for
b. for separately acquired assets, at cost comprising assets so classified. ased on such review, the useful life
the purchase price (including import duties and may change or the useful life assessment may change from
non-refundable taxes) and directly attributable costs to indefinite to finite. The impact of such changes is accounted
prepare the asset for its intended use. for as a change in accounting estimate.
Internally generated assets for which the cost is clearly
Investment Property
identifiable are capitalised at cost. Research expenditure is
recognised as an expense when it is incurred. Development Properties that are held for long-term rental yields and / or
costs are capitalised only after the technical and commercial for capital appreciation are classified as investment
feasibility of the asset for sale or use has been established. properties. Investment properties are stated at cost of
Thereafter, all directly attributable expenditure incurred to acquisition or construction less accumulated depreciation
prepare the asset for its intended use are recognised as the and impairment, if any. Depreciation is recognised using
cost of such assets. Internally generated brands, websites the straight line method so as to amortise the cost of
and customer lists are not recognised as intangible assets. investment properties over their useful lives as specified in

ITC Limited REPORT AND ACCOUNTS 2024 171

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

Schedule II of the Companies Act, 2013. Freehold land and Gains / losses arising on settlement as also on translation
properties under construction are not depreciated. of monetary items are recognised in the Statement of Profit
Transfers to, or from, investment properties are made at and Loss.
the carrying amount when and only when there is a change Exchange differences arising on monetary items that, in
in use. substance, form part of the Company’s net investment in
An item of investment property is derecognised upon a foreign operation (having a functional currency other
disposal or when no future economic benefits are expected than Indian Rupee) are recognised in other comprehensive
to arise from the continued use of asset. Any gain or loss income and accumulated in Foreign Currency Translation
arising on the disposal or retirement of an item of investment Reserve.
property is determined as the difference between the sales Derivatives and Hedge Accounting
proceeds and the carrying amount of the property and is
recognised in the Statement of Profit and Loss. Derivatives are initially recognised at fair value and are
subsequently remeasured to their fair value at the end
Income received from investment property is recognised of each reporting period. The resulting gains / losses are
in the Statement of Profit and Loss on a straight-line basis recognised in Statement of Profit and Loss immediately
over the term of the lease. unless the derivative is designated and effective as a
Impairment of Assets hedging instrument, in which case the resulting gain / loss
Impairment loss, if any, is provided to the extent, the is recognised as per the hedge accounting principles
carrying amount of assets or cash generating units exceeds stated below.
their recoverable amount. The Company complies with the principles of hedge
Recoverable amount is higher of an asset’s fair value less accounting where derivative contracts and / or
costs of disposal and its value in use. Value in use is the non-derivative financial assets / liabilities that are permitted
present value of estimated future cash ows expected to under applicable accounting standards are designated
arise from the continuing use of an asset or cash generating as hedging instruments. At the inception of the hedge
unit and from its disposal at the end of its useful life. relationship, the Company documents the relationship
between the hedging instrument and the hedged item,
Impairment losses recognised in prior years are reversed
along with the ris management ob ectives and its strategy
when there is an indication that the impairment losses
for underta ing hedge transaction, which can be a fair value
recognised no longer exist or have decreased. Such
hedge or a cash ow hedge.
reversals are recognised as an increase in carrying
amounts of assets to the extent that it does not exceed the (i) Fair value hedges
carrying amounts that would have been determined (net of Changes in fair value of the designated portion of
amortization or depreciation) had no impairment loss been hedging instruments that qualify as fair value hedges
recognised in previous years. are recognised in profit or loss immediately, together
with any changes in the fair value of the hedged asset or
Inventories
liability that are attributable to the hedged ris . Such fair
Inventories are stated at lower of cost and net realisable value changes are recognised in the line item relating to
value. The cost is calculated on weighted average method. the hedged item in Statement of Profit and Loss.
Cost comprises expenditure incurred in the normal course
of business in bringing such inventories to their present Hedge accounting is discontinued when the hedging
location and condition and includes, where applicable, instrument is derecognised, expires or is sold,
appropriate overheads based on normal level of activity. terminated, or exercised, or when it no longer qualifies
Net realisable value is the estimated selling price less for hedge accounting. The fair value adjustment to the
estimated costs for completion and sale. carrying amount of the hedged item arising from the
hedged ris is amortised to profit or loss from that date.
Obsolete, slow moving and defective inventories are
identified from time to time and, where necessary, a (ii) Cash ow hedges
provision is made for such inventories. The effective portion of changes in the fair value
of hedging instruments that are designated and
Foreign Currency Transactions
qualify as cash flow hedges is recognised in the
The functional and presentation currency of the Company other comprehensive income and accumulated as
is Indian Rupee. Cash Flow Hedge Reserve’. The gains / losses relating
Transactions in foreign currency are accounted for at to the ineffective portion are recognised immediately
the exchange rate prevailing on the transaction date. in the Statement of Profit and Loss.

172 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

Amounts previously recognised and accumulated in C assifi ation Management determines the classification
other comprehensive income are reclassified to profit of an asset at initial recognition depending on the purpose
or loss when the hedged item affects the Statement for which the assets were acquired. The subsequent
of Profit and Loss. However, when the hedged item measurement of financial assets depends on such
results in the recognition of a non financial asset, classification.
such gains / losses are transferred from equity (but not inan ia assets are assifie as t ose eas re at
as reclassification ad ustment) and included in the initial
(a) amortised cost, where the financial assets are held
measurement cost of the non financial asset.
solely for collection of cash ows arising from payments
Hedge accounting is discontinued when the hedging of principal and / or interest.
instrument is derecognised, expires or is sold,
(b) fair value through other comprehensive income
terminated, or exercised, or when it no longer qualifies
(FVTOCI), where the financial assets are held not only
for hedge accounting. Any gains / losses recognised
for collection of cash ows arising from payments of
in other comprehensive income and accumulated in
principal and interest but also from the sale of such
equity at that time remain in equity and is reclassified assets. Such assets are subsequently measured at fair
when the underlying transaction is ultimately value, with unrealised gains and losses arising from
recognised. hen an underlying transaction is no longer changes in the fair value being recognised in other
expected to occur, the gains / losses accumulated in comprehensive income.
equity are recognised immediately in the Statement of
(c) fair value through profit or loss (FVTPL), where the
Profit and Loss.
assets are managed in accordance with an approved
Investment in Subsidiaries, Associates and Joint investment strategy that triggers purchase and sale
Ventures decisions based on the fair value of such assets.
Investment in subsidiaries, associates and oint ventures Such assets are subsequently measured at fair value.
are carried at cost less accumulated impairment, if any. nrealised gains and losses arising from changes in
the fair value, including interest income and dividend
Financial instruments, Financial assets, Financial income, if any, are recognised in other income’ in
liabilities and Equity Instruments the Statement of Profit and Loss in the period in which
Financial assets and financial liabilities are recognised when they arise.
the Company becomes a party to the contractual provisions Trade Receivables, Advances, Security Deposits, Cash
of the relevant instrument and are initially measured at fair and Cash equivalents etc. are classified for measurement
value except for trade receivables that do not contain a at amortised cost while investments may fall under any of
significant financing component, which are measured at the aforesaid classes. However, in respect of particular
transaction price. investments in equity instruments that would otherwise
Transaction costs that are directly attributable to the be measured at fair value through profit or loss, an
acquisition or issue of financial assets and financial irrevocable election at initial recognition may be made to
liabilities (other than financial assets and financial liabilities present subsequent changes in fair value through other
comprehensive income.
measured at fair value through profit or loss) are added
to or deducted from the fair value on initial recognition of Impairment: The Company assesses at each reporting
financial assets or financial liabilities. Purchase or sale of date whether a financial asset (or a group of financial
financial assets that require delivery of assets within a time assets) such as investments, trade receivables, advances
frame established by regulation or convention in the mar et and security deposits held at amortised cost and financial
place (regular way trades) are recognised on the trade assets that are measured at fair value through other
date, i.e., the date when the Company commits to purchase comprehensive income are tested for impairment based
or sell the asset. on evidence or information that is available without undue
cost or effort. Expected credit losses are assessed and loss
Financial Assets allowances recognised if the credit quality of the financial
Recognition: Financial assets include Investments, Trade asset has deteriorated significantly since initial recognition.
Receivables, Advances, Security Deposits, Cash and Cash Reclassification: hen and only when the business
equivalents. Such assets are initially recognised at fair value model is changed, the Company shall reclassify all affected
or transaction price, as applicable, when the Company financial assets prospectively from the reclassification date
becomes party to contractual obligations. The transaction as subsequently measured at amortised cost, fair value
price includes transaction costs unless the asset is being through other comprehensive income or fair value through
fair valued through the Statement of Profit and Loss. profit or loss without restating the previously recognised

ITC Limited REPORT AND ACCOUNTS 2024 173

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

gains, losses or interest and in terms of the reclassification taxes such as VAT and oods and Services Tax which are
principles laid down in the Ind AS relating to Financial payable in respect of sale of goods and services.
Instruments. Revenue from the sale of goods and services is recognised
Derecognition: Financial assets are derecognised when when the Company performs its obligations to its customers
the right to receive cash ows from the assets has expired, and the amount of revenue can be measured reliably and
or has been transferred, and the Company has transferred recovery of the consideration is probable. The timing of such
substantially all of the ris s and rewards of ownership. recognition in case of sale of goods is when the control over
Concomitantly, if the asset is one that is measured at: the same is transferred to the customer, which is mainly
(a) amortised cost, the gain or loss is recognised in the upon delivery and in case of services, in the period in which
Statement of Profit and Loss such services are rendered.
(b) fair value through other comprehensive income, the Government Grant
cumulative fair value ad ustments previously ta en to The Company may receive government grants that require
reserves are reclassified to the Statement of Profit and compliance with certain conditions related to the Company’s
Loss unless the asset represents an equity investment, operating activities or are provided to the Company by
in which case the cumulative fair value adjustments way of financial assistance on the basis of certain
previously ta en to reserves are reclassified within qualifying criteria.
equity.
Government grants are recognised when there is
Income Recognition: Interest income is recognised in the reasonable assurance that the grant will be received upon
Statement of Profit and Loss using the effective interest the Company complying with the conditions attached to the
method. Dividend income is recognised in the Statement grant. Accordingly, government grants:
of Profit and Loss when the right to receive dividend is
(a) related to or used for assets, are deducted from the
established.
carrying amount of the asset.
Financial Liabilities (b) related to incurring specific expenditures are ta en to
orrowings, trade payables and other financial liabilities the Statement of Profit and Loss on the same basis and
are initially recognised at fair value and are subsequently in the same periods as the expenditures incurred.
measured at amortised cost. Any discount or premium on (c) by way of financial assistance on the basis of certain
redemption / settlement is recognised in the Statement of qualifying criteria are recognised in the Statement of
Profit and Loss as finance cost over the life of the liability Profit and Loss as they become receivable.
using the effective interest method and adjusted to the
In the unli ely event that a grant previously recognised is
liability figure disclosed in the alance Sheet.
ultimately not received, it is treated as a change in estimate
Financial liabilities are derecognised when the liability is and the amount cumulatively recognised is expensed in the
extinguished, that is, when the contractual obligation is Statement of Profit and Loss.
discharged, cancelled or on expiry.
Dividend Distribution
Offsetting Financial Instruments
Dividends paid (including income tax thereon, if any) are
Financial assets and liabilities are offset and the net amount recognised in the period in which the interim dividends are
is included in the alance Sheet where there is a legally approved by the oard of Directors, or in respect of the final
enforceable right to offset the recognised amounts and dividend when approved by shareholders.
there is an intention to settle on a net basis or realise the
asset and settle the liability simultaneously. o ee enefits
Short-term employee benefits are expensed in the period
Equity Instruments
in which the employee renders the related service on an
Equity instruments are recognised at the value of the undiscounted basis. A liability is recognised for the amount
proceeds, net of direct costs of the capital issue. expected to be paid within twelve months, if the Company
Revenue has a present legal or constructive obligation to pay the
same as a result of past service provided by the employee
Revenue is measured at the transaction price that the
and the obligation can be reliably estimated.
Company receives or expects to receive as consideration
for goods supplied and services rendered, net of returns The Company ma es contributions to both defined benefit
and estimates of variable consideration such as discounts and defined contribution schemes which are mainly
to customers. Revenue from the sale of goods includes administered through duly constituted and approved Trusts.
Excise Duties and National Calamity Contingent Duty Provident Fund contributions are in the nature of defined
which are payable on manufacture of goods but excludes contribution scheme. In respect of employees who

174 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

are members of constituted and approved trusts, the Committee and approved by the Audit Committee, decide
Company recognises contribution payable to such trusts not to see such reimbursements from:
as an expense including any shortfall in interest between (a) wholly owned subsidiaries who need to conserve
the amount of interest realised by the investment and financial capacity to sustain their business and growth
the interest payable to members at the rate declared by plans and to address contingencies that may arise,
the overnment of India. In respect of other employees, taking into account the economic and market conditions
provident funds are deposited with the Government and then prevailing and opportunities and threats in the
recognised as expense. competitive context.
The Company ma es contribution to defined contribution (b) other companies not covered under (a) above, who
pension plan. The contribution payable is recognised as an need to conserve financial capacity to sustain their
expense, when an employee renders the related service. business and growth plans and where the quantum of
reimbursement is not material - the materiality threshold
The Company also ma es contribution to defined benefit
being ` 5 Crores for each entity for a financial year.
pension and gratuity plan. The cost of providing benefits
under the defined benefit obligation is calculated by Cash Settled Stock Appreciation Linked Reward
independent actuary using the pro ected unit credit method. (SAR) Plan
Service costs and net interest expense or income is Cash Settled SAR units are granted to eligible employees
re ected in the Statement of Profit and Loss. ain or Loss under the ITC Employee Cash Settled Stoc Appreciation
on account of remeasurements are recognised immediately Lin ed Reward Plan ( ITC ESARP ). The eligible employees
through other comprehensive income in the period in which for this purpose are such present and future permanent
they occur. employees of the Company, including a Director of the
The employees of the Company are entitled to compensated Company, as may be decided by the CMC / Nomination
leave for which the Company records the liability based on Compensation Committee / oard.
actuarial valuation computed using projected unit credit For cash settled SAR units granted to eligible employees, a
method. These benefits are unfunded. liability is initially measured at fair value at the grant date and
is subsequently remeasured at each reporting period, until
Actual disbursements made under the or ers’ Voluntary
settled. The fair value of ESAR units granted is recognised
Retirement Scheme are accounted as revenue expenses.
in the Statement of Profit and Loss over the period in which
Employee Share Based Compensation the performance and / or service conditions are fulfilled
for employees of the Company. In case of employees on
Stock Options deputation to group companies, the Company generally
Stoc Options are granted to eligible employees under see s reimbursements from the concerned group company.
the ITC Employee Stoc Option Schemes ( ITC ESOS ), The value of such payments, net of reimbursements,
as may be decided by the Nomination Compensation is considered as capital contribution / investment.
Committee / oard. Eligible employees for this purpose
Leases
include employees of the Company including Directors
and those on deputation and employees of the Company’s The Company assesses at contract inception whether a
subsidiary companies including Managing Director / contract is, or contains, a lease. A contract is, or contains, a
lease if it conveys the right to control the use of an identified
holetime Director of a subsidiary.
asset for a period of time in exchange for consideration.
nder Ind AS, the cost of ITC Stoc Options (Stoc Options)
is recognised based on the fair value of Stock Options as Company as a Lessee
on the grant date. Right-of- se (RO ) assets are recognised at inception of
The fair value of Stock Options granted is recognised a contract or arrangement for significant lease components
in the Statement of Profit and Loss over the period in at cost less lease incentives, if any. RO assets are
subsequently measured at cost less accumulated
which the performance and / or service conditions are
depreciation and impairment losses, if any. The cost of RO
fulfilled for employees of the Company (other than those
assets includes the amount of lease liabilities recognised,
out on deputation). The value of Stoc Options, net of
initial direct cost incurred and lease payments made at or
reimbursements, granted to employees on deputation and
before the lease commencement date. RO assets are
to employees of the wholly owned and other subsidiary generally depreciated over the shorter of the lease term
companies is considered as capital contribution / investment. and estimated useful lives of the underlying assets on a
The Company generally see s reimbursement of the value straight line basis. Lease term is determined based on
of Stoc Options from such companies, as applicable. It consideration of facts and circumstances that create an
may, if so recommended by the Corporate Management economic incentive to exercise an extension option, or not to

ITC Limited REPORT AND ACCOUNTS 2024 175

Notes to the Standalone Financial Statements

1. Material Accounting Policies (Contd.)

exercise a termination option. Lease payments associated Deferred tax assets and liabilities are offset when there is
with short-term leases (i.e., those leases that have a lease legally enforceable right to offset current tax assets and
term of 12 months or less from the commencement date liabilities and when the deferred tax balances relate to the
and do not contain a purchase option) and low value leases same taxation authority. Current tax assets and tax liabilities
(i.e., where the value of the underlying asset, when new, in are offset where the entity has a legally enforceable right to
order of magnitude is ` 5 la hs or less) are charged to the offset and intends either to settle on net basis, or to realize
Statement of Profit and Loss on a straight-line basis over the asset and settle the liability simultaneously.
the term of the relevant lease.
Claims
The Company recognises lease liabilities measured at the
present value of lease payments to be made on the date Claims against the Company not ac nowledged as debts
of recognition of the lease. Such lease liabilities do not are disclosed after a careful evaluation of the facts and
include variable lease payments (that do not depend on legal aspects of the matter involved.
an index or a rate), which are recognised as expense in Provisions
the periods in which they are incurred. Interest on lease Provisions are recognised when, as a result of a past
liability is recognised using the effective interest method. event, the Company has a legal or constructive obligation
Lease liabilities are subsequently increased to re ect the it is probable that an out ow of resources will be required
accretion of interest and reduced for the lease payments
to settle the obligation and the amount can be reliably
made. The carrying amount of lease liabilities is also
estimated. The amount so recognised is a best estimate
remeasured upon modification of lease arrangement or
of the consideration required to settle the obligation at the
upon change in the assessment of the lease term. The
reporting date, ta ing into account the ris s and uncertainties
effect of such remeasurements is adjusted to the value of
surrounding the obligation.
the RO assets.
In an event when the time value of money is material, the
Company as a Lessor provision is carried at the present value of the cash ows
Leases in which the Company does not transfer substantially estimated to settle the obligation.
all the risks and rewards of ownership of an asset are
Operating Segments
classified as operating leases. here the Company is a
lessor under an operating lease, the asset is capitalised Operating segments are reported in a manner consistent
within property, plant and equipment or investment property with the internal reporting provided to the chief operating
and depreciated over its useful economic life. Payments decision-ma er (CODM). The CODM, who is responsible
received under operating leases are recognised in the for allocating resources and assessing performance of the
Statement of Profit and Loss on a straight line basis over operating segments, has been identified as the Corporate
the term of the lease. Management Committee.
Segments are organised based on businesses which
Taxes on Income
have similar economic characteristics as well as exhibit
Taxes on income comprise current taxes and deferred similarities in nature of products and services offered,
taxes. Current tax in the Statement of Profit and Loss is the nature of production processes, the type and class of
provided as the amount of tax payable in respect of taxable customer and distribution methods.
income for the period using tax rates and tax laws enacted
during the period, together with any ad ustment to tax Segment revenue arising from third party customers is
payable in respect of previous years. reported on the same basis as revenue in the financial
statements. Inter-segment revenue is reported on the basis
Deferred tax is recognised on temporary differences of transactions which are primarily mar et led. Segment
between the carrying amounts of assets and liabilities and results represent profits before finance charges, unallocated
the amounts used for taxation purposes (tax base), at the corporate expenses and taxes.
tax rates and tax laws enacted or substantively enacted by
the end of the reporting period. nallocated Corporate Expenses include revenue and
expenses that relate to initiatives / costs attributable to the
Deferred tax assets are recognised for the future tax enterprise as a whole.
consequences to the extent it is probable that future
taxable profits will be available against which the deductible Financial and Management Information Systems
temporary differences can be utilised. The Company’s Accounting System is designed to unify
Income tax, insofar as it relates to items disclosed under the Financial and Cost Records and also to comply with the
other comprehensive income or equity, is disclosed relevant provisions of the Companies Act, 2013, to provide
separately under other comprehensive income or equity, financial and cost information appropriate to the businesses
as applicable. and facilitate Internal Control.

176 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

2. Use of estimates and judgements

The preparation of financial statements in conformity period and the impact of changes in the estimated
with generally accepted accounting principles requires useful life is considered in the period in which the
management to make estimates and assumptions that estimate is revised.
affect the reported amounts of assets and liabilities and
2. Fair value measurements and valuation
disclosure of contingent liabilities at the date of the financial
processes:
statements and the results of operations during the
reporting period end. Although these estimates are based Some of the Company’s assets and liabilities
upon management’s best nowledge of current events and are measured at fair value for financial reporting
actions, actual results could differ from these estimates. purposes. In estimating the fair value of an asset or a
liability, the Company uses mar et-observable data
The estimates and underlying assumptions are reviewed on
to the extent it is available. here Level 1 inputs
an ongoing basis. Revisions to accounting estimates are
are not available, the Company engages third party
recognised in the period in which the estimate is revised
valuers, where required, to perform the valuation.
if the revision affects only that period, or in the period of
Information about the valuation techniques and
the revision and future periods if the revision affects both
inputs used in determining the fair value of various
current and future periods.
assets, liabilities and share based payments are
A. Judgements in applying accounting policies disclosed in the notes to the financial statements.
The udgements, apart from those involving estimations 3. Actuarial Valuation:
(see note below), that the Company has made in the
The determination of Company’s liability towards
process of applying its accounting policies and that have
defined benefit obligation to employees is made
a significant effect on the amounts recognised in these
through independent actuarial valuation including
financial statements pertain to useful life of intangible
determination of amounts to be recognised in
assets. The Company is required to determine whether
its intangible assets have indefinite or finite life which is the Statement of Profit and Loss and in Other
a sub ect matter of udgement. Certain trademar s have Comprehensive Income. Such valuation depends
been considered of having an indefinite useful life ta ing upon assumptions determined after taking into
into account that there are no technical, technological or account in ation, seniority, promotion and other
commercial risks of obsolescence or limitations under relevant factors such as supply and demand factors
contract or law. Other trademarks have been amortised in the employment mar et. Information about
over their useful economic life. Refer notes to the financial such valuation is provided in notes to the financial
statements. statements.

B. Key sources of estimation uncertainty 4. Claims, Provisions and Contingent Liabilities:

The following are the ey assumptions concerning the The Company has ongoing litigations with various
future, and other ey sources of estimation uncertainty at the regulatory authorities and third parties. here an
end of the reporting period that may have a significant ris out ow of funds is believed to be probable and a
of causing a material ad ustment to the carrying amounts of reliable estimate of the outcome of the dispute can
assets and liabilities within the next financial year. be made based on management’s assessment of
specific circumstances of each dispute and relevant
1. Useful lives of property, plant and equipment, external advice, management provides for its best
investment property and intangible assets: estimate of the liability. Such accruals are by nature
As described in the material accounting policies, complex and can ta e number of years to resolve
the Company reviews the estimated useful lives of and can involve estimation uncertainty. Information
property, plant and equipment, investment property about such litigations is provided in notes to the
and intangible assets at the end of each reporting financial statements.

ITC Limited REPORT AND ACCOUNTS 2024 177

Notes to the Standalone Financial Statements (` in Crores)
Gross Block

As at Withdrawals As at Withdrawals As at
31st March, and 31st March, and 31st March,
Particulars 2022 Additions adjustments 2023 Additions adjustments # 2024

3A. Property, Plant and Equipment 1

Land 2 2016.73 7.17 5.80 2018.10 4.13 17.57 2004.66
Buildings 8428.65 686.84 10.08 9105.41 929.54 42.04 9992.91
Leasehold Improvements 13.28 0.10 0.77 12.61 9.13 – 21.74
Plant and Equipment 16256.41 1712.10 163.45 17805.06 2101.72 157.53 19749.25
Furniture and Fixtures 884.78 103.54 7.64 980.68 65.05 7.02 1038.71
Vehicles 155.61 23.32 22.67 156.26 24.12 22.04 158.34
Office Equipment 28.57 3.21 1.16 30.62 6.53 0.88 36.27
Railway Sidings 1.73 – – 1.73 – – 1.73
Total 27785.76 2536.28 211.57 30110.47 3140.22 247.08 33003.61
3B. Capital work-in-progress 2442.34 1732.59 2493.46 1681.47 2471.14 3074.64 1077.97
3C. Investment Property 3 410.11 – (0.52) 410.63 – (41.40) 452.03
3D. Goodwill 577.20 – – 577.20 – – 577.20
3E. Other Intangible assets (acquired)
Assets with indefinite life 4
Trademarks 1889.78 – – 1889.78 – – 1889.78
Assets with finite life
Trademarks 30.57 – – 30.57 – – 30.57
Computer Software 237.40 66.30 3.37 300.33 49.69 1.84 348.18
Know How, Business and Commercial Rights 43.38 0.51 – 43.89 12.51 – 56.40
Customer Relationships 35.21 – – 35.21 – – 35.21
Total 2236.34 66.81 3.37 2299.78 62.20 1.84 2360.14
3F. Intangible assets under development 23.84 53.98 62.69 15.13 52.40 58.46 9.07
3G. Right-of-use assets ^
Land 516.63 – – 516.63 9.09 0.19 525.53
Buildings 297.05 71.39 70.85 297.59 85.40 39.54 343.45
Plant and Equipment 48.63 – – 48.63 – 6.80 41.83
TOTAL 862.31 71.39 70.85 862.85 94.49 46.53 910.81
# Includes amounts transferred to Investment Property on its recognition
^ Also refer Note 28(vii)

Notes:
1. a) The above includes following assets given on operating lease:
(` in Crores)
As at 31st March, 2023 2023 As at 31st March, 2024 2024

Depreciation Depreciation
Accumulated Charge Accumulated Charge
Particulars Gross Block Depreciation Net Block for the year Gross Block Depreciation Net Block for the year

Land 1.48 – 1.48 – 1.48 – 1.48 –

Buildings 4.11 1.22 2.89 0.08 3.59 1.15 2.44 0.06
Plant and Equipment 247.10 166.96 80.14 17.75 267.22 183.41 83.81 14.24
TOTAL 252.69 168.18 84.51 17.83 272.29 184.56 87.73 14.30

b) The amount of expenditure recognised in the carrying amount of property, plant and equipment in the course of construction is ` 129.01 Crores (2023 - ` 90.50 Crores).
2. Land includes certain lands at Munger with Gross Block - ` 1.16 Crores (2023 - ` 1.16 Crores) which stood vested with the State of Bihar under the Bihar Land Reforms Act, 1950 for which
compensation has not yet been determined.

178 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements (` in Crores)
Depreciation and Amortization Net Book Value

Upto On Withdrawals Upto On Withdrawals Upto As at As at

31st March, For and 31st March, For and 31st March, 31st March, 31st March,
Particulars 2022 the year adjustments 2023 the year adjustments# 2024 2024 2023

3A. Property, Plant and Equipment 1

Land 2 – – – – – – – 2004.66 2018.10
Buildings 1129.24 239.88 4.17 1364.95 234.28 9.96 1589.27 8403.64 7740.46
Leasehold Improvements 7.37 1.76 0.40 8.73 0.33 – 9.06 12.68 3.88
Plant and Equipment 6527.82 1210.12 133.07 7604.87 1188.01 124.26 8668.62 11080.63 10200.19
Furniture and Fixtures 467.54 79.43 6.15 540.82 82.82 6.00 617.64 421.07 439.86
Vehicles 74.59 16.85 14.49 76.95 16.31 14.84 78.42 79.92 79.31
Office Equipment 19.14 4.72 2.07 21.79 2.96 0.82 23.93 12.34 8.83
Railway Sidings 0.91 0.13 – 1.04 0.13 – 1.17 0.56 0.69
Total 8226.61 1552.89 160.35 9619.15 1524.84 155.88 10988.11 22015.50 20491.32
3B. Capital work-in-progress – – – – – – – 1077.97 1681.47
3C. Investment Property 3 45.91 12.38 (0.08) 58.37 13.53 (7.04) 78.94 373.09 352.26
3D. Goodwill – – – – – – – 577.20 577.20
3E. Other Intangible assets (acquired)
Assets with indefinite life 4
Trademarks – – – – – – – 1889.78 1889.78
Assets with finite life
Trademarks 20.44 3.14 – 23.58 3.14 – 26.72 3.85 6.99
Computer Software 179.04 21.16 0.41 199.79 32.34 1.84 230.29 117.89 100.54
Know How, Business and Commercial Rights 22.25 4.95 – 27.20 4.00 – 31.20 25.20 16.69
Customer Relationships 7.39 4.40 – 11.79 4.40 – 16.19 19.02 23.42
Total 229.12 33.65 0.41 262.36 43.88 1.84 304.40 2055.74 2037.42
3F. Intangible assets under development – – – – – – – 9.07 15.13
3G. Right-of-use assets ^
Land 21.40 7.83 – 29.23 8.02 – 37.25 488.28 487.40
Buildings 111.51 50.59 66.46 95.64 52.26 16.59 131.31 212.14 201.95
Plant and Equipment 16.56 5.51 – 22.07 5.29 6.80 20.56 21.27 26.56
TOTAL 149.47 63.93 66.46 146.94 65.57 23.39 189.12 721.69 715.91

3. The fair value of the investment property is ` 1166.02 Crores (2023 - ` 903.04 Crores). The fair value has been determined on the basis of valuation carried out at the reporting date by registered
valuer as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017 and the same has been categorised as Level 2 based on the valuation techniques used and inputs
applied. The main inputs considered by the valuer are government rates, property location, market research & trends, contracted rentals, terminal yields, discount rates and comparable values, as
appropriate.
Amounts recognised in the Statement of Profit and Loss in respect of the investment property is as under:
(` in Crores)
Particulars For the year ended For the year ended
31st March, 2024 31st March, 2023
Rental Income etc. from investment property 138.90 124.05
Direct Operating Expenses arising from investment property that
generated rental income during the year$ 14.75 11.42
Direct Operating Expenses arising from investment property that
did not generate rental income during the year – –
$As per the contractual arrangements, the Company is responsible for the maintenance of common area at its own cost. The expenses arising out of such arrangements are not material.
4. Assets with indefinite life pertain to the FMC - Others’ Segment and are related to the randed Pac aged Foods and Personal Care Products businesses of the Company.
Impairment testing for goodwill and intangible assets with indefinite useful lives has been carried out considering their recoverable amounts which, inter-alia, includes estimation of their value-in-use
based on management pro ections. These pro ections have been made for a period of five years, or longer, as applicable and consider various factors, such as mar et scenario, growth trends, growth
and margin pro ections, and terminal growth rates specific to the business.
For such projections, discount rate of 10% (2023 - 10%) and long-term growth rates ranging between 5% to 6% (2023 - 5% to 6%) have been considered. Discount rate has been determined
considering the Weighted Average Cost of Capital (WACC) of market benchmarks.
Based on the above assessment, no impairment has been recognised during the year. Further, the Company has also performed sensitivity analysis around the base assumptions and has concluded
that there are no reasonably possible changes to key assumptions that would cause the carrying amount of the aforesaid assets to exceed their recoverable values.

ITC Limited REPORT AND ACCOUNTS 2024 179

Notes to the Standalone Financial Statements
Capital work-in-progress (CWIP) ageing schedule (` in Crores)
As at 31st March, 2023 As at 31st March, 2024
Amount in CWIP for a period of Amount in CWIP for a period of

Less than 1-2 2-3 More than Less than 1-2 2-3 More than
Particulars 1 year years years 3 years Total 1 year years years 3 years Total

Projects in Progress 655.86 345.20 140.10 540.31 1681.47 870.57 149.72 25.69 31.99 1077.97
Projects temporarily suspended – – – – – – – – – –
TOTAL 655.86 345.20 140.10 540.31 1681.47 870.57 149.72 25.69 31.99 1077.97

Completion schedule for Projects in Capital work-in-progress, which are overdue or has exceeded its cost compared to its original plan
(` in Crores)
As at 31st March, 2023 As at 31st March, 2024
To be completed in To be completed in

Less than 1-2 2-3 More than Less than 1-2 2-3 More than
Particulars 1 year years years 3 years 1 year years years 3 years

MXD - KOL 633.54 – – – – – – –

Intangible assets under development (IAUD) ageing schedule (` in Crores)

As at 31st March, 2023 As at 31st March, 2024
Amount in IAUD for a period of Amount in IAUD for a period of

Less than 1-2 2-3 More than Less than 1-2 2-3 More than
Particulars 1 year years years 3 years Total 1 year years years 3 years Total

Projects in Progress 15.13 – – – 15.13 7.62 1.45 – – 9.07

Projects temporarily suspended – – – – – – – – – –
TOTAL 15.13 – – – 15.13 7.62 1.45 – – 9.07

Note: There are no projects in IAUD, which are overdue or has exceeded its cost compared to its original plan as at 31st March, 2024 and 31st March, 2023.

180 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

INVESTMENT IN EQUITY INSTRUMENTS

In Subsidiaries (at cost unless stated otherwise)
Unquoted
Gold Flake Corporation Limited 10 1,59,98,385 16.00 1,59,98,385 16.00
Russell Credit Limited
Fully paid 10 59,74,54,177 619.29 59,74,54,177 619.29
` 6.50 per share paid 10 7,54,22,400 39.22 7,54,22,400 39.22
ITC Infotech India Limited 10 8,80,00,000 616.18 8,80,00,000 617.01
Landbase India Limited 10 31,70,00,000 325.57 31,70,00,000 325.57
Surya Nepal Private Limited (Ordinary Shares) Nepalese
Rupee (NRS)
50 (2023 -
NRS 100) 2,37,88,800 10.15 1,18,94,400 10.15
Srinivasa Resorts Limited 10 1,63,20,477 18.53 1,63,20,477 18.53
Fortune Park Hotels Limited 10 4,50,008 0.45 4,50,008 0.45
Bay Islands Hotels Limited 100 11,875 0.12 11,875 0.12
WelcomHotels Lanka (Private) Limited No par value 66,58,32,260 1952.35 40,08,47,960 1247.99
Wimco Limited 1 18,50,81,193 3.50 18,50,81,193 3.50
Technico Pty Limited (Ordinary Shares)
( ` 16.29 Crores impaired) No par value 1,00,15,502 31.88 1,00,15,502 31.88
Technico Agri Sciences Limited 10 3,79,62,800 121.00 3,79,62,800 121.00
ITC Integrated Business Services Limited 10 75,00,000 7.50 45,00,000 4.50
ITC IndiVision Limited 10 12,00,00,000 120.00 12,00,00,000 120.00
North East Nutrients Private Limited 10 5,54,80,000 55.48 5,54,80,000 55.48
Pavan Poplar Limited
(cost ` 5.99 Crores, fully impaired) 10 55,10,004 – 55,10,004 –
Prag Agro Farm Limited
(cost ` 12.82 Crores, fully impaired) 1 1,28,00,020 – 1,28,00,020 –
ITC Fibre Innovations Limited 10 20,00,00,000 200.00 10,000 0.01
ITC Hotels Limited 1 83,00,00,000 83.00 – –
In Associates (at cost unless stated otherwise)
Quoted
International Travel House Limited 10 39,14,233 21.87 2,87,600 0.65
Gujarat Hotels Limited 10 17,33,907 1.94 17,33,907 1.94
Unquoted
Delectable Technologies Private Limited 10 2,386 3.60 100 0.10
Mother Sparsh Baby Care Private Limited 10 100 0.96 100 0.96
Sproutlife Foods Private Limited
[Refer Note 28(ix)] 10 2,443 40.33 – –

Carried over 4288.92 3234.35

ITC Limited REPORT AND ACCOUNTS 2024 181

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 4288.92 3234.35

INVESTMENT IN EQUITY INSTRUMENTS (Contd.)

In Joint Ventures (at cost unless stated otherwise)

Unquoted

Espirit Hotels Private Limited [Refer Note 28(x)] 10 – – 4,65,09,200 46.51

Maharaja Heritage Resorts Limited 100 1,80,000 1.80 90,000 0.90

Logix Developers Private Limited [Refer Note 28(viii)]

[cost ` 41.95 Crores, fully impaired] 10 77,66,913 – 77,66,913 –

In Others (at fair value through other comprehensive

income unless stated otherwise)

Quoted

EIH Limited 2 8,56,21,473 3848.69 8,56,21,473 1418.32

HLV Limited 2 4,99,53,055 130.13 4,99,53,055 45.71

Tourism Finance Corporation of India Limited 10 25,000 0.43 25,000 0.18

VST Industries Limited 10 476 0.17 476 0.15

Unquoted

Andhra Pradesh Gas Power Corporation Limited 10 8,04,000 – 8,04,000 –

Bihar Hotels Limited 2 8,00,000 0.04 8,00,000 0.04

Woodlands Multispeciality Hospital Limited 10 13,605 0.01 13,605 0.01

Mirage Advertising and Marketing Limited 10 12,488 – 12,488 –

Blupin Technologies Private Limited

(at fair value through profit or loss) 10 400 3.82 400 3.82

INVESTMENT IN PREFERENCE SHARES

In Subsidiaries (at amortised cost unless

stated otherwise)

Unquoted

WelcomHotels Lanka (Private) Limited (at cost)

(Cumulative Non-Convertible Redeemable
Preference Shares) No par value 38,33,73,340 1527.42 38,33,73,340 1527.42

Wimco Limited
(Cumulative Non-Convertible Redeemable
Preference Shares) 100 – – 5,00,000 5.00

ITC IndiVision Limited

(Cumulative Non-Convertible Redeemable
Preference Shares) 100 2,20,00,000 220.00 1,60,00,000 160.00

Carried over 10021.43 6442.41

182 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 10021.43 6442.41

INVESTMENT IN PREFERENCE SHARES (Contd.)
In Associates (at cost)
Unquoted
Delectable Technologies Private Limited
(Compulsorily Convertible Cumulative
Preference Shares) 10 7,759 7.40 7,759 7.40
Mother Sparsh Baby Care Private Limited
(Compulsorily Convertible Cumulative
Preference Shares) 10 3,837 44.04 2,980 32.50
Sproutlife Foods Private Limited [Refer Note 28(ix)]
(Compulsorily Convertible Preference Shares) 10 9,571 184.67 – –
In t ers at air va e t ro g rofit or oss
Unquoted
Blupin Technologies Private Limited
(Compulsorily Convertible Cumulative
Preference Shares) 100 2,980 35.52 2,980 35.52
INVESTMENT IN GOVERNMENT OR TRUST SECURITIES
(at amortised cost)
Quoted
Government of India Zero Coupon Government Stock
Zero Coupon Government Stock - 22-Feb-2025 100 – – 34,00,000 30.62
Zero Coupon Government Stock - 15-Jun-2025 100 10,20,000 9.51 10,20,000 8.97
Zero Coupon Government Stock - 22-Aug-2025 100 25,35,000 23.31 25,35,000 21.94
Zero Coupon Government Stock - 15-Dec-2025 100 36,34,800 32.83 36,34,800 30.93
Zero Coupon Government Stock - 17-Dec-2025 100 6,02,300 5.42 6,02,300 5.10
Zero Coupon Government Stock - 22-Feb-2026 100 25,35,000 22.52 25,35,000 21.17
Zero Coupon Government Stock - 15-Jun-2026 100 10,20,000 8.89 10,20,000 8.35
Zero Coupon Government Stock - 22-Aug-2026 100 63,54,400 54.55 63,54,400 51.19
Zero Coupon Government Stock - 15-Dec-2026 100 10,20,000 8.58 10,20,000 8.05
Zero Coupon Government Stock - 22-Feb-2027 100 40,11,000 33.20 40,11,000 31.10
Zero Coupon Government Stock - 15-Jun-2027 100 31,17,000 25.32 31,17,000 23.73
Zero Coupon Government Stock - 22-Aug-2027 100 48,54,400 38.70 48,54,400 36.20
Unquoted
Government Securities - cost ` 70000.00 – 0.01 – 0.01
National Savings Certificates (pledged with various
Mandi Samitis) (cost ` 6000.00) … …

Carried over 10555.90 6795.19

ITC Limited REPORT AND ACCOUNTS 2024 183

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 10555.90 6795.19

INVESTMENT IN BONDS IN THE NATURE OF
DEBENTURES (at amortised cost)
Quoted
Tax Free Bonds - Secured, Redeemable &
Non-Convertible
Housing and Urban Development Corporation Limited

7.07% - Series B - 01-Oct-2025 10,00,000 4,300 432.13 4,300 433.65

7.19% - Series A - 31-Jul-2025 10,00,000 150 15.18 150 15.31
7.39% - Series 2A - 08-Feb-2031 1,000 7,00,696 70.07 7,00,696 70.07
8.20% - Series 2 - 05-Mar-2027 1,000 5,00,000 52.62 5,00,000 53.42
India Infrastructure Finance Company Limited

7.36% - Series II - 22-Jan-2028 1,000 3,00,000 31.38 3,00,000 31.69

8.26% - Series V B - 23-Aug-2028 10,00,000 1,175 121.96 1,175 122.82
8.46% - Series VI B - 30-Aug-2028 10,00,000 1,300 137.27 1,300 138.65
8.48% - Series VII B - 05-Sep-2028 10,00,000 1,780 185.83 1,780 187.31
Indian Railway Finance Corporation Limited

7.07% - Series 102 - 21-Dec-2025 1,000 70,498 7.13 70,498 7.18

7.15% - Series 100 - 21-Aug-2025 10,00,000 250 25.28 250 25.46
7.19% - Series 99 - 31-Jul-2025 10,00,000 2,250 225.26 2,250 225.38
7.34% - Series 86A - 19-Feb-2028 1,000 1,00,000 10.51 1,00,000 10.63
8.48% - Series 89A - 21-Nov-2028 10,00,000 1,250 130.20 1,250 131.09
8.55% - Series 94A - 12-Feb-2029 10,00,000 130 13.60 130 13.69
National Bank for Agriculture and Rural
Development
7.07% - Series 1A - 25-Feb-2026 10,00,000 2,000 203.14 2,000 204.71
National Highways Authority of India

7.11% - Series NHAI - II A - 18-Sep-2025 10,00,000 2,600 260.23 2,600 260.25

7.14% - Series I A - 11-Jan-2026 1,000 8,06,381 81.19 8,06,381 81.45
7.28% - Series NHAI - II B - 18-Sep-2030 10,00,000 2,500 250.00 2,500 250.00
7.35% - Series II A - 11-Jan-2031 1,000 17,49,943 181.40 17,49,943 182.10
8.50% - Series II A - 05-Feb-2029 1,000 5,00,000 54.74 5,00,000 55.55
8.75% - Series II B - 05-Feb-2029 1,000 2,50,000 27.77 2,50,000 28.25

Carried over 13072.79 9323.85

184 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 13072.79 9323.85

INVESTMENT IN BONDS IN THE NATURE OF

DEBENTURES (Contd.)

National Housing Bank

8.46% - Series V - 30-Aug-2028 10,00,000 800 83.07 800 83.65

Power Finance Corporation Limited
7.16% - Series 136 - 17-Jul-2025 10,00,000 600 60.63 600 61.11
8.46% - Series 107B - 30-Aug-2028 10,00,000 500 51.92 500 52.28
8.54% - Series 2A - 16-Nov-2028 1,000 3,50,000 38.73 3,50,000 39.42
REC Limited
7.17% - Series 5A - 23-Jul-2025 10,00,000 850 85.88 850 86.51
8.46% - Series 3B - 29-Aug-2028 10,00,000 1,190 125.96 1,190 127.30
8.46% - Series 2A - 24-Sep-2028 1,000 3,50,000 38.52 3,50,000 39.20
8.54% - Series 4B - 11-Oct-2028 10,00,000 50 5.21 50 5.25
Taxable Bonds - Unsecured, Redeemable &
Non-Convertible

National Bank for Agriculture and Rural Development

5.70% - Series 22 D - 31-Jul-2025 10,00,000 – – 1,000 99.45
7.62% - Series 24 H - 10-May-2029 1,00,000 20,000 200.00 – –
7.62% - Series 23 I - 31-Jan-2028 1,00,000 19,000 188.72 – –
7.49% - Series 24 B - 15-Oct-2026 1,00,000 10,000 99.06 – –
7.69% - Series 20 C - 29-May-2024 10,00,000 – – 4,300 441.85
8.22% - Series PMAYG-PB-2 - 13-Dec-2028 10,00,000 1,550 158.48 – –
Power Finance Corporation Limited
8.20% - Series 128 - 10-Mar-2025 10,00,000 – – 450 46.75
8.39% - Series 130 C - 19-Apr-2025 10,00,000 – – 200 20.89

Small Industries Development Bank of India

7.43% - Series I - 31-Aug-2026 1,00,000 5,000 49.50 – –

7.44% - Series II - 04-Sep-2026 1,00,000 5,000 49.52 – –

7.68% - Series IX - 10-Aug-2027 1,00,000 30,000 299.99 – –

7.79% - Series IV - 19-Apr-2027 1,00,000 30,000 299.90 – –

7.79% - Series VI - 14-May-2027 1,00,000 25,000 249.86 – –
7.83% - Series V - 24-Nov-2028 1,00,000 40,500 404.91 – –

Carried over 15562.65 10427.51

ITC Limited REPORT AND ACCOUNTS 2024 185

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 15562.65 10427.51

INVESTMENT IN BONDS IN THE NATURE OF

DEBENTURES (Contd.)

Perpetual Bonds - Unsecured, Subordinated &

Non-Convertible#

State Bank of India

7.72 - Series I (with first Call option on 03-Sep-2026) 1,00,00,000 313 313.00 313 313.00

7.72 - Series II (with first Call option on 1 -Oct-2026) 1,00,00,000 400 400.00 400 400.00

Zero Coupon Bonds - Secured, Redeemable &

Non-Convertible

LIC Housing Finance Limited

Tranche 416 - 25-Apr-2025 10,00,000 10,000 1144.67 10,000 1081.21

INVESTMENT IN DEBT MUTUAL FUNDS

Quoted

Fixed Maturity Plans (at amortised cost)*

Aditya Birla Sun Life Mutual Fund 10 2,19,98,900 24.84 2,19,98,900 23.40

DSP Mutual Fund 10 4,99,97,500 55.04 4,99,97,500 51.36

Nippon India Mutual Fund 10 1,49,99,250 17.09 1,49,99,250 16.06

SBI Mutual Fund 10 23,69,88,151 269.91 23,69,88,151 255.23

Exchange Traded Funds (at fair value through

other comprehensive income) **

Axis Mutual Fund 1 13,25,00,000 154.00 5,50,00,000 59.60

Edelweiss Mutual Fund 1,000 33,03,209 395.25 – –

Nippon India Mutual Fund 10 6,50,00,000 778.38 6,50,00,000 726.12

Unquoted

Target Maturity Index Funds (at fair value through

other comprehensive income) **

Aditya Birla Sun Life Mutual Fund 10 84,29,49,728 945.75 84,29,49,728 882.34

Axis Mutual Fund 10 16,74,27,323 185.66 14,37,69,946 148.73

DSP Mutual Fund 10 4,76,41,228 53.08 2,49,40,887 26.04

ICICI Prudential Mutual Fund 10 54,91,10,334 615.29 54,91,10,334 574.27

Kotak Mahindra Mutual Fund 10 59,85,34,837 669.83 42,26,69,978 438.22

Nippon India Mutual Fund 10 24,38,33,990 269.43 24,38,33,990 251.24

SBI Mutual Fund 10 75,82,85,035 846.11 54,75,53,778 569.97

Carried over 22699.98 16244.30

186 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
Number Number
otherwise) Crores) Crores)

4. Non-current investments (Contd.)

Brought forward 22699.98 16244.30

INVESTMENT IN ALTERNATIVE INVESTMENT FUNDS

at air va e t ro g rofit or oss

Unquoted

Chiratae Ventures India Fund IV 1,00,000 1,279 18.74 1,125 17.33

Fireside Ventures Investments Fund I 1,00,000 1,289 42.29 1,335 58.06

Fireside Ventures Investments Fund II 1,000 1,79,000 28.37 1,40,000 17.47

Fireside Ventures Investments Fund III 1,00,000 560 4.42 300 3.00

India Foundation Fund Series I 100 4,73,457 4.80 3,46,463 3.85

Roots Ventures I 100 9,63,113 23.34 9,13,113 19.54

Aggregate amount of quoted investments 12824.99 8302.60

Aggregate amount of unquoted investments 9996.95 8060.95

TOTAL 22821.94 16363.55

Aggregate market value of quoted investments ` 12915.49 Crores (2023 - ` 8340.39 Crores).
Aggregate amount of impairment in value of investments ` 77.05 Crores (2023 - ` 77.05 Crores).

Investments in Fixed Maturity Plans (FMPs) that are intended to be held by the Company till maturity are classified as amortised
cost. The underlying instruments in the portfolio of these FMPs have minimal churn and are held to receive contractual cash ows.
Exchange Traded / Target Maturity Index Funds follow a passive buy and hold investment strategy to receive contractual cash ows
except for meeting redemption and rebalancing requirements. Investment in such funds are classified as FVTOCI as cash ows
from these investments are realised on maturity or upon sale.
# Additional Tier 1 bonds, which are perpetual in nature, are issued by commercial banks under Reserve Bank of India guidelines.
These have been classified as debt instruments by the Company based on the substantive characteristics of the contract.

ITC Limited REPORT AND ACCOUNTS 2024 187

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Current Non-Current Current Non-Current

5. Loans

Other Loans - Employees

– Unsecured, considered good 9.10 2.63 5.95 4.07

TOTAL 9.10 2.63 5.95 4.07

6. Other Financial assets

Bank deposits with more than 12 months maturity – 300.00 – 2034.40

Other financial assets
Security Deposits * 28.49 72.59 25.50 73.27
Deposits other than Security Deposits 8.16 0.29 2.75 1500.56

Interest accrued on Loans, Deposits, Investments etc. 403.25 – 393.83 –

Other Receivables** 409.96 – 283.76 –

TOTAL 849.86 372.88 705.84 3608.23

* Include deposits to Directors and Key Management Personnel ` 0.01 Crore (2023 - ` 0.06 Crore) (Refer Note 30).
** Comprise receivables on account of government grants, claims, rentals, derivatives designated as hedging instrument etc.

188 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Current Non-Current Current Non-Current

7. Other Assets

Capital Advances – 194.32 – 168.45

Advances other than capital advances
Security Deposits
– With Statutory Authorities 0.71 790.91 0.35 789.38
– Others 0.97 162.10 0.79 149.86
Advances to related parties (Refer Note 30) 21.30 – – –
Other Advances (including advances with statutory
authorities, prepaid expenses, employees etc.) 965.13 81.89 1197.50 104.05
Other Receivables* 146.07 – 189.45 –

TOTAL 1134.18 1229.22 1388.09 1211.74

* Comprise receivables on account of government grants, withholding taxes etc.

As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

8. Inventories*

(At lower of cost and net realisable value)

Raw materials (including packing materials) 8494.87 6937.54
Work-in-progress 322.10 263.47
Finished goods (manufactured) 2115.45 2063.30
Stock-in-trade (goods purchased for resale) 979.40 700.11
Stores and spares 623.96 514.39
Intermediates - Tissue paper and Paperboards 95.73 115.09

TOTAL 12631.51 10593.90

The above includes goods in transit as under:

Raw materials (including packing materials) 159.15 229.89
Stock-in-trade (goods purchased for resale) 2.89 2.37
Stores and spares 2.05 4.37

TOTAL 164.09 236.63

The cost of inventories recognised as an expense includes ` 151.49 Crores (2023 - ` 156.27 Crores) in respect of write-offs / write-downs
of inventory to net realisable value. During the year, reversal of previous write-downs of ` 1.87 Crores (2023 - ` 0.81 Crore) have been
made owing to subsequent increase in net realisable value.
Inventories of ` 670.06 Crores (2023 - ` 337.08 Crores) are expected to be recovered after more than twelve months.
* Cash credit facilities are secured by hypothecation of inventories of the Company, both present and future. The quarterly
returns / statements filed by the Company with the ban (s) in respect of such facilities are in agreement with the boo s of accounts.

ITC Limited REPORT AND ACCOUNTS 2024 189

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
otherwise) Number Number
Crores) Crores)

9. C rrent invest ents at air va e t ro g rofit or oss n ess

stated otherwise) (Contd.)

INVESTMENT IN BONDS IN THE NATURE OF

DEBENTURES

Quoted

Tax Free Bonds - Secured, Redeemable &

Non-Convertible

Indian Railway Finance Corporation Limited

8.23% - Series 91 - 18-Feb-2024 1,000 – – 20,00,000 201.79

Power Finance Corporation Limited

8.01% - Series 107 A - 30-Aug-2023 10,00,000 – – 1,000 100.26

8.18% - Series 1 A - 16-Nov-2023 1,000 – – 12,95,560 130.24

REC Limited

8.01% - Series 3 A - 29-Aug-2023 10,00,000 – – 1,000 100.25

INVESTMENT IN CERTIFICATES OF DEPOSIT

Unquoted

Axis Bank Limited - 19-Jul-2023 5,00,000 – – 42,000 2045.45

Axis Bank Limited - 18-Jul-2024 5,00,000 42,000 2039.00 – –

Export Import Bank of India - 17-Aug-2023 5,00,000 – – 1,000 48.37

Export Import Bank of India - 29-Aug-2023 5,00,000 – – 1,000 48.23

HDFC Bank Limited - 17-Jul-2023 5,00,000 – – 9,500 462.88

HDFC Bank Limited - 11-Aug-2023 5,00,000 – – 1,600 77.50

HDFC Bank Limited - 14-Aug-2023 5,00,000 – – 8,500 411.43

HDFC Bank Limited - 12-Sep-2023 5,00,000 – – 12,000 576.92

HDFC Bank Limited - 18-Jul-2024 5,00,000 10,000 485.47 – –

ICICI Bank Limited - 19-Jul-2023 5,00,000 – – 5,000 243.51

ICICI Bank Limited - 07-Aug-2023 5,00,000 – – 1,000 48.48

ICICI Bank Limited - 12-Dec-2023 5,00,000 – – 5,000 235.39

Kotak Mahindra Bank Limited - 19-Jul-2023 5,00,000 – – 6,000 292.21

Kotak Mahindra Bank Limited - 27-Jul-2023 5,00,000 – – 1,000 48.61

Kotak Mahindra Bank Limited - 17-Aug-2023 5,00,000 – – 500 24.18

Carried over 2524.47 5095.70

190 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
otherwise) Number Number
Crores) Crores)

9. C rrent invest ents at air va e t ro g rofit or oss n ess

stated otherwise) (Contd.)

Brought forward 2524.47 5095.70

INVESTMENT IN CERTIFICATES OF DEPOSIT (Contd.)

National Bank for Agriculture and

Rural Development - 23-Jan-2024 5,00,000 – – 1,500 69.95

Small Industries Development Bank of

India - 07-Jun-2023 5,00,000 – – 2,000 98.38

Small Industries Development Bank of

India - 29-Aug-2023 5,00,000 – – 1,000 48.23

Small Industries Development Bank of

India - 12-Sep-2023 5,00,000 – – 1,000 48.08

INVESTMENT IN DEBT MUTUAL FUNDS

Quoted

Exchange Traded Funds

Edelweiss Mutual Fund 1,000 – – 30,00,000 368.71

Nippon India Mutual Fund 10 58,69,560 70.52 58,69,560 65.73

Unquoted

Liquid / Overnight Funds

LIC Mutual Fund 1,000 2,31,584 100.18 – –

Nippon India Mutual Fund 100 – – 66,75,451 80.01

Ultra Short Term Funds

Aditya Birla Sun Life Mutual Fund 100 1,86,63,673 940.65 1,86,63,673 874.86

Kotak Mahindra Mutual Fund 10 23,75,47,122 963.52 23,75,47,122 897.90

SBI Mutual Fund 1,000 2,47,159 136.90 2,47,159 127.50

Low Duration Funds

Aditya Birla Sun Life Mutual Fund 100 87,701 5.78 87,701 5.36

Axis Mutual Fund 1,000 14,17,525 416.27 14,17,525 387.03

Bandhan Mutual Fund 10 7,34,11,386 263.71 7,34,11,386 245.79

DSP Mutual Fund 10 17,22,63,805 311.47 17,22,63,805 290.89

ICICI Prudential Mutual Fund 100 1,40,07,103 699.32 1,40,07,103 647.96

SBI Mutual Fund 1,000 19,73,814 650.49 19,73,814 604.99

Carried over 7083.28 9957.07

ITC Limited REPORT AND ACCOUNTS 2024 191

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
otherwise) Number Number
Crores) Crores)

9. C rrent invest ents at air va e t ro g rofit or oss n ess

stated otherwise) (Contd.)

Brought forward 7083.28 9957.07

INVESTMENT IN DEBT MUTUAL FUNDS (Contd.)

Money Market Funds

Aditya Birla Sun Life Mutual Fund 100 40,95,539 139.49 40,95,539 129.50

Axis Mutual Fund 1,000 20,57,053 269.73 20,57,053 250.47

Bandhan Mutual Fund 10 4,22,87,680 167.70 4,22,87,680 155.87
HDFC Mutual Fund 1,000 7,47,666 396.04 7,47,666 367.98
Kotak Mahindra Mutual Fund 1,000 6,53,754 269.36 6,53,754 250.28
Nippon India Mutual Fund 1,000 6,60,345 252.20 6,60,345 234.26
SBI Mutual Fund 10 6,33,58,708 256.09 6,33,58,708 238.05
Floating Rate Funds
Aditya Birla Sun Life Mutual Fund 100 1,94,01,569 627.15 1,94,01,569 581.25
HDFC Mutual Fund 10 10,07,90,662 461.93 10,07,90,662 427.05
Nippon India Mutual Fund 10 6,22,64,756 265.83 6,22,64,756 246.04
Short Duration Funds
DSP Mutual Fund 10 2,31,36,440 105.31 – –
Kotak Mahindra Mutual Fund 10 1,02,55,708 52.81 – –
Nippon India Mutual Fund 10 1,02,78,225 52.81 – –
SBI Mutual Fund 10 5,40,50,081 165.74 5,40,50,081 154.07
Banking & PSU Debt Funds
Axis Mutual Fund 1,000 31,86,227 770.87 31,86,227 720.37
Bandhan Mutual Fund 10 14,17,61,931 316.53 14,17,61,931 296.13
Corporate Bond Funds
ICICI Prudential Mutual Fund 10 4,30,40,789 121.08 2,42,40,779 63.09
Kotak Mahindra Mutual Fund 1,000 2,98,810 105.58 – –
INVESTMENT IN BONDS IN THE NATURE OF
DEBENTURES (at amortised cost)
Quoted
Taxable Bonds - Unsecured, Redeemable &
Non-Convertible
National Bank for Agriculture and Rural
Development

6.40% - Series 20K - 31-Jul-2023 10,00,000 – – 2,700 268.84

Carried over 11879.53 14340.32

192 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
otherwise) Number Number
Crores) Crores)

9. C rrent invest ents at air va e t ro g rofit or oss n ess

stated otherwise) (Contd.)

Brought forward 11879.53 14340.32

Current Portion of Non-current investments

INVESTMENT IN PREFERENCE SHARES

In Subsidiaries (at amortised cost)

Unquoted

Wimco Limited
(Cumulative Non-Convertible Redeemable
Preference Shares) 100 5,00,000 5.00 – –

INVESTMENT IN GOVERNMENT OR TRUST

SECURITIES (at amortised cost)

Quoted

Government of India Zero Coupon Government

Stock

Zero Coupon Government Stock - 22-Feb-2025 100 34,00,000 32.35 – –

INVESTMENT IN BONDS IN THE NATURE OF

DEBENTURES (at amortised cost)

Quoted

Tax Free Bonds - Secured, Redeemable &

Non-Convertible

India Infrastructure Finance Company Limited

8.01% - Series 1A - 12-Nov-2023 1,000 – – 50,000 5.05

Indian Railway Finance Corporation Limited

8.23% - Series 91 - 18-Feb-2024 1,000 – – 8,00,000 81.36

8.35% - Series 89 - 21-Nov-2023 10,00,000 – – 100 10.13

Taxable Bonds - Unsecured, Redeemable &

Non-Convertible

Export Import Bank of India

5.20% - Series X 01 - 04-Mar-2025

(with Put and Call option on 04-Mar-2024) 10,00,000 – – 2,000 200.00

Power Finance Corporation Limited

5.47% - Series 206 - 19-Aug-2023 10,00,000 – – 100 10.01

6.72% - Series 203 A - 09-Jun-2023 10,00,000 – – 900 90.25

6.75% - Series 202 A - 22-May-2023 10,00,000 – – 1,200 120.25

Carried over 11916.88 14857.37

ITC Limited REPORT AND ACCOUNTS 2024 193

Notes to the Standalone Financial Statements
Face Value ` As at 31st March, 2024 As at 31st March, 2023
(Fully Paid
unless stated (` in (` in
otherwise) Number Number
Crores) Crores)

9. C rrent invest ents at air va e t ro g rofit or oss n ess

stated otherwise) (Contd.)

Brought forward 11916.88 14857.37

INVESTMENT IN BONDS IN THE NATURE OF

DEBENTURES (Contd.)

Perpetual Bonds - Unsecured, Subordinated &

Non-Convertible#

ICICI Bank Limited

9.15% - Series DMR 18AT

(with first Call option on 20- un-2023) 10,00,000 – – 2,647 264.70

9.90% - Series DDE 18AT

(with first Call option on 2 -Dec-2023) 10,00,000 – – 3,000 300.00

State Bank of India

9.37% - Series II
(with first Call option on 21-Dec-2023) 10,00,000 – – 2,350 235.00

9.56% - Series I
(with first Call option on 04-Dec-2023) 10,00,000 – – 7,000 700.00

Aggregate amount of quoted investments 102.87 3252.57

Aggregate amount of unquoted investments 11814.01 13104.50

TOTAL 11916.88 16357.07

Aggregate market value of quoted investments ` 102.50 Crores (2023 - ` 3253.03 Crores).
# Additional Tier 1 bonds, which are perpetual in nature, are issued by commercial banks under Reserve Bank of India guidelines.
These have been classified as debt instruments by the Company based on the substantive characteristics of the contract.

194 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

10. Trade receivables (Current)

Considered good – Secured 51.44 55.96

Considered good – Unsecured 3260.01 2265.37
hich have significant increase in Credit Ris – –
Credit impaired 161.19 167.87
Less: Allowance for credit impairment 161.19 167.87

TOTAL 3311.45 2321.33

Trade receivables ageing schedule (` in Crores)

Outstanding for following periods from due date of payment

as at 31st March, 2024
Not Due Total
Less than 6 months- 1-2 2-3 More than
6 months 1 year years years 3 years

ndisputed Trade Receivables considered

good 1405.64 1862.76 37.83 5.22 – – 3311.45
ndisputed Trade Receivables which have
significant increase in credit ris – – – – – – –
ndisputed Trade Receivables credit impaired – 0.13 5.24 1.29 1.28 35.86 43.80
Disputed Trade Receivables considered good – – – – – – –
Disputed Trade Receivables which have
significant increase in credit ris – – – – – – –
Disputed Trade Receivables credit impaired – 1.03 3.27 2.98 0.65 109.46 117.39
SUB-TOTAL 1405.64 1863.92 46.34 9.49 1.93 145.32 3472.64
Less: Allowance for credit impairment 161.19
TOTAL 3311.45

(` in Crores)
Outstanding for following periods from due date of payment
as at 31st March, 2023
Not Due Total
Less than 6 months- 1-2 2-3 More than
6 months 1 year years years 3 years

ndisputed Trade Receivables considered

good 1566.84 731.95 17.39 0.63 4.52 – 2321.33
ndisputed Trade Receivables which have
significant increase in credit ris – – – – – – –
ndisputed Trade Receivables credit impaired – 0.02 7.85 6.74 22.00 20.95 57.56
Disputed Trade Receivables considered good – – – – – – –
Disputed Trade Receivables which have
significant increase in credit ris – – – – – – –
Disputed Trade Receivables credit impaired – – 0.21 0.55 1.75 107.80 110.31
SUB-TOTAL 1566.84 731.97 25.45 7.92 28.27 128.75 2489.20
Less: Allowance for credit impairment 167.87
TOTAL 2321.33

ITC Limited REPORT AND ACCOUNTS 2024 195

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

11. Cash and cash equivalents@

alances with an s
Current accounts 192.48 203.19
Cheques, drafts on hand 1.85 1.37
Cash on hand 3.30 2.32

TOTAL 197.63 206.88

@ Cash and cash equivalents include cash on hand, cheques, drafts on hand, cash at ban and deposits with ban s with original
maturity of 3 months or less.
The Company does not have any cash and cash equivalents that are not available for use.

12. Other bank balances

Earmar ed balances 268.81 239.30

In deposit accounts** 5751.25 3385.08

TOTAL 6020.06 3624.38

Includes balances towards unpaid dividend, unspent corporate social responsibility.

Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the
Balance Sheet date.

196 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
As at As at As at As at
31st March, 2024 31st March, 2024 31st March, 2023 31st March, 2023
(No. of Shares) (` in Crores) (No. of Shares) (` in Crores)

13. Equity Share capital

Authorised
Ordinary Shares of ` 1.00 each 20,00,00,00,000 2000.00 20,00,00,00,000 2000.00
Issued and Subscribed
Ordinary Shares of ` 1.00 each, fully paid 12,48,47,21,471 1248.47 12,42,80,17,741 1242.80

A) Reconciliation of number of
Ordinary Shares outstanding
As at beginning of the year 12,42,80,17,741 1242.80 12,32,32,55,931 1232.33
Add: Issue of Shares on exercise
of Options 5,67,03,730 5.67 10,47,61,810 10.48
As at end of the year 12,48,47,21,471 1248.47 12,42,80,17,741 1242.80

B) Shareholders holding more than 5% of the Ordinary Shares in the Company

As at As at As at As at
31st March, 2024 31st March, 2024 31st March, 2023 31st March, 2023
(No. of Shares) (%) (No. of Shares) (%)

Tobacco Manufacturers (India) Limited 2,54,14,95,863 20.36 2,97,83,47,320 23.96

Life Insurance Corporation of India 1,89,68,61,285 15.19 1,89,68,61,285 15.26
Specified nderta ing of the
Unit Trust of India 97,45,31,427 7.81 97,45,31,427 7.84

C) Shareholding of Promoters: Nil

D) Ordinary Shares allotted as fully paid pursuant to contract(s) without payment being received in cash or as fully paid up
on s ares ring t e erio o five ears i e iate re e ing st Mar Nil

E) Rights, preferences and restrictions attached to the Ordinary Shares

The Ordinary Shares of the Company, having par value of ` 1.00 per share, ran pari passu in all respects including voting rights and
entitlement to dividend.

F) Shares reserved for issue under Options

As at As at
31st March, 2024 31st March, 2023
(No. of Shares) (No. of Shares)

Ordinary Shares of ` 1.00 each 8,99,46,120 13,20,94,790

Terms and Conditions of Options Granted

Each Option entitles the holder thereof to apply for and be allotted ten Ordinary Shares of the Company of ` 1.00 each upon payment of the exercise
price during the exercise period. The exercise period commences from the date of vesting of the Options and expires at the end of five years from
the date of vesting in respect of Options.
The vesting period for conversion of Options is as follows:
On completion of 12 months from the date of grant of the Options : 30% vests
On completion of 24 months from the date of grant of the Options : 30% vests
On completion of 36 months from the date of grant of the Options : 40% vests
The Options have been granted at the mar et price’ as defined under the Securities and Exchange oard of India (Share ased Employee enefits
and Sweat Equity) Regulations, 2021.
Further details of ITC Employee Stoc Option Schemes are provided in Note 2 (xii).

ITC Limited REPORT AND ACCOUNTS 2024 197

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Current Non-Current Current Non-Current

14. Borrowings

Unsecured
Deferred payment liabilities
Sales tax deferment loans* 1.52 1.76 1.26 3.28

TOTAL 1.52 1.76 1.26 3.28

Interest free deferral period of 14 years and repayable by 2025-26.

The repayment schedule is summarised as under:

As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

In the first year 1.52 1.26

In the second year 1.76 1.52
In the third to fifth year – 1.76

TOTAL 3.28 4.54

As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Current Non-Current Current Non-Current

15. Lease Liabilities *

Lease Liabilities 46.74 261.95 46.54 273.59

TOTAL 46.74 261.95 46.54 273.59

* Refer Note 2 (vii)

Movement of Lease Liabilities during the year

Particulars 31st March, 2024 31st March, 2023

Opening Lease Liabilities 320.13 305.88

New Leases recognised 69.45 70.96
Remeasurements and withdrawals (24.25) (4.74)
Interest expense on Lease Liabilities 25.84 25.54
Payment of Lease Liabilities (including interest) (82.48) (77.51)

Closing Lease Liabilities 308.69 320.13

198 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

t er finan ia ia i ities

Non-current
Others
(Includes payable towards employee benefits, retention money payable
towards property, plant and equipment etc.) 109.87 152.49

TOTAL 109.87 152.49

Current
Interest accrued 2.01 1.69
Unpaid dividend * 251.19 239.07
Unpaid matured deposits and interest accrued thereon … …
npaid matured debentures / bonds and interest accrued thereon 0.30 0.30
Others (Includes payable towards employee benefits, property, plant and
equipment, derivatives designated as hedging instruments, contingent
consideration on business combination etc.) 1405.83 1489.62

TOTAL 1659.33 1730.68

Represents dividend amounts either not claimed or ept in abeyance in accordance with Section 126 of the Companies Act, 2013
or such amounts in respect of which Prohibitory / Attachment Orders are on record with the Company.
Represents amounts which are sub ect matter of a pending legal dispute with a ban for which the Company has filed a suit.

As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Current Non-Current Current Non-Current

17. Provisions

Provision for employee benefits Refer Note 2 (vi)

Retirement benefits 60.70 148.79 55.43 139.45
Other benefits 8.02 72.66 8.16 62.38

TOTAL 68.72 221.45 63.59 201.83

ITC Limited REPORT AND ACCOUNTS 2024 199

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

18. Deferred tax liabilities (Net)*

Deferred tax liabilities 2618.85 2146.97

Less: Deferred tax assets 535.19 525.84
TOTAL 2083.66 1621.13
Refer Note 2 (xi)
(` in Crores)
Recognised Recognised Re assifie
Opening in rofit or Recognised directly in to rofit or Closing
Movement in deferred tax liabilities / assets balances Balance loss in OCI Equity loss Balance
2023-24
Deferred tax liabilities / assets in relation to:
On fiscal allowances on property, plant and equipment,
investment property etc. 1721.61 122.13 – – – 1843.74
On Excise Duty / National Calamity Contingent Duty on
closing stoc 117.93 (17.32) – – – 100.61
On cash ow hedges 0.84 – (2.49) (2.74) 4.82 0.43
Other timing differences 306.59 125.83 241.65 – – 674.07
Total deferred tax liabilities 2146.97 230.64 239.16 (2.74) 4.82 2618.85
On employees’ separation and retirement etc. 132.63 (22.40) 11.30 – – 121.53
On provision for doubtful debts / advances 52.48 4.62 – – – 57.10
On State and Central taxes etc. 70.07 3.18 – – – 73.25
Other timing differences 270.66 12.65 – – – 283.31
Total deferred tax assets 525.84 (1.95) 11.30 – – 535.19
Deferred tax liabilities (Net) 1621.13 232.59 227.86 (2.74) 4.82 2083.66

2022-23
Deferred tax liabilities / assets in relation to:
On fiscal allowances on property, plant and equipment,
investment property etc. 1642.06 79.55 – – – 1721.61
On Excise Duty / National Calamity Contingent Duty on
closing stoc 79.21 38.72 – – – 117.93
On cash ow hedges 4.82 – (34.32) 2.62 27.72 0.84
Other timing differences 348.22 (32.82) (8.81) – – 306.59
Total deferred tax liabilities 2074.31 85.45 (43.13) 2.62 27.72 2146.97
On employees’ separation and retirement etc. 62.59 65.04 5.00 – – 132.63
On provision for doubtful debts / advances 53.11 (0.63) – – – 52.48
On State and Central taxes etc. 69.62 0.45 – – – 70.07
Other timing differences 221.85 48.81 – – – 270.66
Total deferred tax assets 407.17 113.67 5.00 – – 525.84
Deferred tax liabilities (Net) 1667.14 (28.22) (48.13) 2.62 27.72 1621.13

As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

19. Other liabilities (Current)

Statutory Liabilities 4398.88 4039.86

Advances received from customers 828.69 1275.96
Others (includes deferred revenue, accruals etc.) 162.18 130.34
TOTAL 5389.75 5446.16

200 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
As at As at
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

20. Current Tax Liabilities (Net)

Current taxation (net of advance payment) 760.00 776.13

TOTAL 760.00 776.13

For the year ended For the year ended

31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

21A. Revenue from operations

Sale of Products 66466.10 66903.80

Sale of Services 2980.10 2577.09
ross Revenue from sale of products and services including Excise
Duty / National Calamity Contingent Duty of ` 4733.29 Crores
(2023 - ` 4054.16 Crores) 69446.20 69480.89
Other Operating Revenues # 659.09 770.39

TOTAL 70105.29 70251.28

Net of sales returns, damaged stoc s and estimates of variable consideration such as discounts to customers.
# Includes Government grants of ` 237.47 Crores (2023 - ` 300.58 Crores) on account of Fiscal and Export Incentives etc.

21B. Gross Revenue from sale of products and services*

FMCG
– Cigarettes etc. 30596.59 28206.83
randed Pac aged Food Products 17194.50 15762.46
– Others (Education and Stationery Products, Personal Care Products,
Safety Matches, Agarbattis etc.) 3727.97 3319.02

Hotels
– Income from Sale of Services 2973.74 2573.22

Agri Business
nmanufactured Tobacco 2612.06 2677.69
Other Agri Products and Commodities ( heat, Rice, Spices, Coffee,
Soya etc.) 5805.38 9637.17

Paperboards, Paper and Packaging

Paperboards and Paper 5871.71 6570.82
Pac aging and Printed Materials 664.25 733.68

TOTAL 69446.20 69480.89

* Net of sales returns, damaged stoc s and estimates of variable consideration such as discounts to customers.

ITC Limited REPORT AND ACCOUNTS 2024 201

Notes to the Standalone Financial Statements
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

22. Other income

Interest income 1592.41 1434.53

Dividend income 990.35 556.90
Other non-operating income 955.52 446.18
TOTAL 3538.28 2437.61

Interest income:
a) Deposits with ban s etc. - carried at amortised cost 537.66 382.73
b) Financial assets:
– mandatorily measured at FVTPL 211.95 206.61
– measured at amortised cost 555.02 719.79
– measured at FVTOCI 287.72 121.02
c) Others (from statutory authorities etc.) 0.06 4.38
TOTAL 1592.41 1434.53

Dividend income:
a) Equity instruments measured at FVTOCI held at the end of
reporting period 9.43 0.01
b) Other investments 980.92 556.89
TOTAL 990.35 556.90

Other non-operating income:

Net foreign exchange gain / (loss) (3.96) 13.74
Net gain / (loss) arising on financial instruments measured at
amortised cost / mandatorily measured at FVTPL (Refer Note 31) 781.06 283.17
ain recognised on divestment of shares held in oint venture
Refer Note 2 (x) 9.49 –
Impairment of investment in oint venture – (8.50)
Others (including income from leases etc.) 168.93 157.77
TOTAL 955.52 446.18

* Includes ` 149.37 Crores (2023 - ` 2.24 Crores) being net gain / (loss) on sale of investments.

202 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

23. C anges in inventories o finis e goo s to in ra e

work-in-progress and intermediates

Opening inventories
Finished goods (manufactured) 2063.30 1638.93
or -in-progress 263.47 232.70
Stoc -in-Trade (goods purchased for resale) 700.11 1150.95
Intermediates - Tissue paper and Paperboards 115.09 79.89
Less: Closing inventories
Finished goods (manufactured) 2115.45 2063.30
or -in-progress 322.10 263.47
Stoc -in-Trade (goods purchased for resale) 979.40 700.11
Intermediates - Tissue paper and Paperboards 95.73 115.09

TOTAL (370.71) (39.50)

o ee enefits e ense

Salaries and wages 3181.37 2905.05

Contribution to Provident and other funds 178.95 171.87
Share based payments to employees Includes cash-settled share based
payments ` 32.06 Crores (2023 - ` 20 .62 Crores) 135.16 267.12
Staff welfare expenses 305.31 280.91
3800.79 3624.95
Less: Recoveries made / reimbursements received 68.56 55.49

TOTAL 3732.23 3569.46

Refer Note 2 (xii) and 2 (xiii)

25. Finance costs

Interest expense:
On Lease liabilities 25.84 25.45
On financial liabilities measured at amortised cost 8.40 4.00
– Others (to statutory authorities etc.) 11.49 12.36
TOTAL 45.73 41.81

ITC Limited REPORT AND ACCOUNTS 2024 203

Notes to the Standalone Financial Statements
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

26. Other Expenses

Power and fuel 1083.65 1199.84

Consumption of stores and spare parts 442.94 446.03
Contract processing charges 1046.72 941.72
Rent 277.10 239.68
Rates and taxes 243.20 153.02
Insurance 129.41 132.43
Repairs
– Buildings 116.59 104.80
– Machinery 339.45 325.43
– Others 93.28 81.43
Maintenance and up eep 349.74 312.93
Outward freight and handling charges 1582.34 1648.69
Warehousing charges 244.35 233.72
Advertising / Sales promotion 1420.31 1155.71
Mar et research 193.97 153.38
Design and product development 45.09 48.08
Hotel reservation / Mar eting expenses 68.03 56.76
Retail accessories 224.19 224.54
ro erage and discount - sales 14.78 17.82
Commission to selling agents 19.85 18.92
Doubtful and bad debts 9.23 (0.93)
Doubtful and bad advances, loans and deposits 25.03 1.16
an and credit card charges 30.21 31.77
Information technology services 366.82 311.31
Travelling and conveyance 310.16 266.31
Training and development 24.44 18.55
Legal expenses 34.55 37.07
Consultancy / Professional fees 207.66 175.52
Postage, telephone etc. 18.25 19.48
Printing and stationery 17.97 16.66
( ain) / Loss on sale of property, plant and equipment - Net (52.94) 4.88
Loss on sale of stores and spare parts - Net 2.09 1.45
Miscellaneous expenses 1319.41 1271.00
TOTAL 10247.87 9649.16
Miscellaneous expenses include:
(1) Auditors’ remuneration and expenses
Audit fees 3.85 3.40
Tax audit fees 0.85 0.70
Fees for limited review 1.62 1.40
Fees for other services1 0.43 0.44
Reimbursement of expenses 0.19 0.22
(2) Cost auditors’ fees 0.12 0.11
* Excluding taxes.
1. (a) Auditors’ remuneration excludes remuneration for services amounting to ` 1.90 Crores (2023 - ` 2.44 Crores) rendered by
networ firm / entity which is a part of the networ of which auditor is a member firm.
(b) In addition to the above, ` 0.25 Crore (2023 - Nil) has been paid to the Statutory Auditors in respect of certification fees relating
to the proposed demerger which are disclosed under exceptional items Refer Note 2 (i) .

204 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements
For the year ended For the year ended
31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

27. Income tax expenses

o nt re ognise in rofit or oss

Current tax
Income tax for the year 6138.25 6019.69
Ad ustments / (credits) related to previous years - Net (477.04) 5.63
Total current tax 5661.21 6025.32
Deferred tax
Deferred tax for the year 223.99 (22.59)
Ad ustments / (credits) related to previous years - Net 8.60 (5.63)
Total deferred tax 232.59 (28.22)
TOTAL 5893.80 5997.10

B. Amount recognised in other comprehensive income

The tax (charge) / credit arising on income and expenses recognised in other comprehensive income is as follows:
On items that will not be reclassified to profit or loss
Remeasurements gains / (losses) on defined benefit plans 5.79 5.00
Equity instruments through other comprehensive income (237.14) –
Related to designated portion of hedging instruments in cash ow hedges 2.63 (5.34)
(228.72) (0.34)
On items that will be reclassified to profit or loss
Related to designated portion of hedging instruments in cash ow hedges (4.96) 11.94
Debt instruments through other comprehensive income (4.51) 8.81
TOTAL (238.19) 20.41

C. Amount recognised directly in equity

The income tax (charged) / credited directly to equity during the year is as follows:
Deferred tax
Arising on gains / (losses) of hedging instruments in cash ow hedges
transferred to the initial carrying amounts of hedged items (2.74) 2.62
TOTAL (2.74) 2.62

D. Reconciliation of effective tax rate

The income tax expense for the year can be reconciled to the accounting profit as follows:
Profit e ore ta 26315.77 24750.41
Income tax expense calculated @ 25.168% (2023 - 25.168%) 6623.15 6229.18
Effect of tax relating to uncertain tax positions 34.90 25.29
Effect of different tax rate on certain items (115.87) (162.27)
Effect of Income not taxable (64.91) (76.60)
Other differences (115.03) (18.50)
Total 6362.24 5997.10
Ad ustments recognised in the current year in relation to the current tax
of prior years* (468.44) –
In o e ta re ognise in rofit or oss 5893.80 5997.10

The tax rate of 25.16 (22 surcharge 10 and cess 4 ) used for the year 2023-24 and 2022-23 is the corporate tax rate applicable
on taxable profits under the Income-tax Act, 1 61.
The Company has reassessed its provisions relating to uncertain tax positions for earlier years based on a favourable order of the
Hon’ble Supreme Court received during the year. This has resulted in a credit of ` 468.44 Crores in the Current Tax expense for the year
ended 31st March, 2024.

ITC Limited REPORT AND ACCOUNTS 2024 205

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements

(i) The Board of Directors of the Company at its meeting held on August 14, 2023 has, subject to necessary approvals, approved a
Scheme of Arrangement amongst ITC Limited (‘Demerged Company’) and ITC Hotels Limited (‘Resulting Company’) and their
respective shareholders and creditors under Section 230 to 232 read with the other applicable provisions of the Companies
Act, 2013 ( Scheme’). The Scheme, inter alia, provides for demerger of the Demerged nderta ing (as defined in the Scheme)
comprising the Hotels Business of the Demerged Company into the Resulting Company on a going concern basis and the
consequent issuance of Equity Shares by the Resulting Company to all the shareholders of the Demerged Company as per
the Share Entitlement Ratio i.e., for every 10 Ordinary Shares of face and paid-up value of ` 1/- each held in the Demerged
Company, 1 Equity Share of face and paid-up value of ` 1/- each of the Resulting Company, and in accordance with Section
2(19AA) read with other relevant provisions of the Income-tax Act, 1961. The Scheme shall be effective from the Appointed Date
and shall be operative from the Effective Date.

The Scheme is subject to requisite approvals, including approval of the National Company Law Tribunal, Kolkata Bench.
Accordingly, no accounting effect in respect of the Scheme has been given in these Financial Statements. Further,
expenses aggregating ` 7.57 Crores incurred during the year in relation to the said demerger have been disclosed under
‘Exceptional Items’.

(ii) Earnings per share: 2024 2023

Earnings per share has been computed as under:

(a) Profit for the year (` in Crores) 20421.97 18753.31
(b) Weighted average number of Ordinary shares outstanding for
the purpose of basic earnings per share 12,46,10,58,425 12,38,15,12,709
(c) Effect of potential Ordinary shares on Employee Stock Options
outstanding 2,80,92,231 3,28,14,400
(d) Weighted average number of Ordinary shares in computing
diluted earnings per share [(b) + (c)] 12,48,91,50,656 12,41,43,27,109
(e) Earnings per share on profit for the year
(Face Value ` 1.00 per share)
– Basic [(a) / (b)] 16.39 15.15
– Diluted [(a) / (d)] 16.35 15.11

(iii) Amount required to be spent by the Company during the year as per Section 135 read with Section 198 of the Companies Act,
2013 - ` 403.47 Crores (2023 - ` 364. 1 Crores) being 2 of the average Net Profit of the Company.
Expenditure incurred during the year is ` 404.05 Crores (2023 - ` 365.50 Crores) comprising employee benefits expense of
` 15.52 Crores (2023 - ` 14.33 Crores) and other expenses of ` 388.53 Crores (2023 - ` 351.17 Crores), of which ` 30.60
Crores (2023 - ` 62.71 Crores) is accrued for payment as on 31st March, 2024. Such CSR expenditure does not include
any spends on construction / acquisition of assets. Amount available for set off in succeeding financial years is ` 1.93 Crores
(2023 - ` 1.35 Crores).
Such CSR expenditure of ` 404.05 Crores (2023 - ` 365.50 Crores) excludes ` 10.89 Crores (2023 - ` 9.43 Crores) being the
excess of expenditure of salaries of CSR personnel and administrative expenses over the limit of 5% of total CSR expenditure
laid down under Rule 7(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 for such expenses.
CSR activities undertaken during the year pertain to: poverty alleviation; promoting education and skill development; promoting
healthcare including preventive healthcare; providing sanitation and drinking water; ensuring environmental sustainability;
promoting gender equality and women empowerment; enabling climate resilience; rural development projects; creating
livelihoods for people (especially those from disadvantaged sections of society); protection of national heritage, art and culture;
preserving and promoting music; promoting sports; conducting research in science, technology, engineering and medicine
aimed at promoting Sustainable Development Goals (SDGs) and providing relief and assistance to victims of disasters
and calamities.
(iv) Research and Development expenses for the year amount to ` 170.37 Crores (2023 - ` 161.31 Crores).

206 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

(v) Contingent liabilities and commitments:

(a) Contingent liabilities
Claims against the Company not acknowledged as debts ` 963.29 Crores (2023 - ` 875.28 Crores), including interest on
claims, where applicable, estimated to be ` 314.23 Crores (2023 - ` 283.62 Crores). These comprise:
Excise duty, VAT / sales taxes, GST and other indirect taxes claims disputed by the Company relating to issues of
applicability and classification aggregating ` 645.81 Crores (2023 - ` 585.19 Crores), including interest on claims, where
applicable, estimated to be ` 288.56 Crores (2023 - ` 261.96 Crores).
Local Authority taxes / cess / royalty on property, utilities etc. claims disputed by the Company relating to issues of
applicability and determination aggregating ` 264.79 Crores (2023 - ` 239.94 Crores), including interest on claims,
where applicable, estimated to be ` 18.72 Crores (2023 - ` 15.09 Crores).
Third party claims arising from disputes relating to contracts aggregating ` 41.27 Crores (2023 - ` 31.79 Crores),
including interest on claims, where applicable, estimated to be ` 0.29 Crore (2023 - ` 0.17 Crore).
Other matters ` 11.42 Crores (2023 - ` 18.36 Crores), including interest on other matters, where applicable, estimated
to be ` 6.66 Crores (2023 - ` 6.40 Crores).
It is not practicable for the Company to estimate the closure of these issues and the consequential timings of cash ows,
if any, in respect of the above.
(b) Commitments
Estimated amount of contracts remaining to be executed on capital accounts and not provided for ` 896.78 Crores
(2023 - ` 1403.04 Crores).
Uncalled liability on partly paid-up shares and other investments is ` 50.86 Crores (2023 - ` 60.71 Crores).
(vi) o ee enefit P ans
es ri tion o P ans
The Company ma es contributions to both Defined enefit and Defined Contribution Plans for qualifying employees. These
Plans are administered through approved Trusts, which operate in accordance with the Trust Deeds, Rules and applicable
Statutes. The concerned Trusts are managed by Trustees who provide strategic guidance with regard to the management of
their investments and liabilities and also periodically review their performance.
Provident Fund, Pension and ratuity enefits are funded and Leave Encashment enefits are unfunded in nature. The Defined
enefit Pension Plans are based on employees’ pensionable remuneration and length of service. nder the Provident Fund,
ratuity and Leave Encashment Schemes, employees are entitled to receive lump sum benefits.
a efine enefit P ans
The liabilities arising in the Defined enefit Schemes are determined in accordance with the advice of independent,
professionally qualified actuaries, using the pro ected unit credit method. The Company ma es regular contributions to
these Defined enefit Plans. Additional contributions are made to these plans as and when required based on actuarial
valuation. Some Group companies also participate in these Plans. These participating Group companies make contributions
to the Plans for their respective employees on a uniform basis and each entity ascertains their obligation through actuarial
valuation. The net Defined benefit cost is recognised by these companies in their respective Financial Statements.
Risk Management
The Defined enefit Plans expose the Company to ris of actuarial deficit arising out of investment ris , interest rate ris and
salary cost in ation ris .
Investment Ris : This may arise from volatility in asset values due to mar et uctuations and impairment of assets due to
credit losses. These Plans primarily invest in debt instruments such as Government securities and highly rated corporate
bonds – the valuation of which is inversely proportional to the interest rate movements.
Interest Rate Ris : The present value of Defined enefit Plan liability is determined using the discount rate based on the
market yields prevailing at the end of reporting period on Government securities. A decrease in yields will increase the fund
liabilities and vice-versa.
Salary Cost In ation Ris : The present value of the Defined enefit Plan liability is calculated with reference to the future
salaries of participants under the Plan. Increase in salary might lead to higher liabilities.
These Plans have a relatively balanced mix of investments in order to manage the above risks. The investment strategy is designed
based on the interest rate scenario, liquidity needs of the Plans and pattern of investment as prescribed under various statutes.
The Trustees regularly monitor the funding and investments of these Plans. Risk mitigation systems are in place to ensure
that the health of the portfolio is regularly reviewed and investments do not pose any significant ris of impairment. Periodic
audits are conducted to ensure adequacy of internal controls. Pension obligation of the employees is secured by purchasing
annuities thereby de-risking the Plans from future payment obligation.

ITC Limited REPORT AND ACCOUNTS 2024 207

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

For the year ended For the year ended

31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Leave Leave
Pension Gratuity Pension Gratuity
Encashment Encashment
Funded Unfunded Funded Unfunded
I Components of Employer Expense
– Re ognise in t e tate ent o Profit
and Loss
1 Current Service Cost 37.63 33.48 12.87 41.32 32.14 12.23
2 Past Service Cost – – – – – –
3 Net Interest Cost (3.65) (1.95) 11.06 (1.59) (1.41) 9.18
4 Total expense recognised in the
tate ent o Profit an oss 33.98 31.53 23.93 39.73 30.73 21.41
– Remeasurements recognised in Other
Comprehensive Income
5 Return on plan assets (excluding amounts
included in Net interest cost) (21.85) (3.45) – 13.71 1.15 –
6 Effect of changes in demographic
assumptions 1.65 0.74 0.42 – – –
7 Effect of changes in financial assumptions 25.08 17.30 6.00 (10.44) (13.10) (2.80)
8 Changes in asset ceiling (excluding
interest income) – – – – – –
9 Effect of experience adjustments (26.79) 23.27 0.60 (1.31) 26.27 8.33
10 Total remeasurements included in
Other Comprehensive Income (21.91) 37.86 7.02 1.96 14.32 5.53
11 ota efine enefit ost
recognised in the Statement of
Profit an oss an t er
Comprehensive Income (4+10) 12.07 69.39 30.95 41.69 45.05 26.94
The current service cost, past service cost and net interest cost for the year, as applicable, pertaining to Pension and
Gratuity expenses have been recognised in “Contribution to Provident and other funds” and Leave Encashment in
Salaries and wages under Note 24. The remeasurements of the net defined benefit liability are included in Other
Comprehensive Income.
(` in Crores)
Leave Leave
Pension Gratuity Pension Gratuity
Encashment Encashment
II Actual Returns 88.39 36.53 – 44.92 26.71 –
III Net sset ia i it re ognise
in Balance Sheet
1 Present Value of Defined enefit
Obligation 898.65 496.77 171.48 878.89 439.40 154.53
2 Fair Value of Plan Assets 919.95 458.76 – 854.51 423.43 –
3 Status Surplus / (Deficit) 21.30 (38.01) (171.48) (24.38) (15.97) (154.53)
4 Restrictions on Asset Recognised – – – – – –

208 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

(` in Crores)

5 Net sset ia i it re ognise in

As at 31st March, 2024 As at 31st March, 2023
Balance Sheet

Current Non-current Current Non-current

– Pension 21.30 – (24.38) –
– Gratuity (38.01) – (15.97) –
– Leave Encashment (22.69) (148.79) (15.08) (139.45)

For the year ended For the year ended

31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Pension Gratuity Leave Pension Gratuity Leave

Encashment Encashment
IV C ange in efine enefit
igation
1 Present Value of DBO at the beginning
of the year 878.89 439.40 154.53 897.75 416.05 144.48
2 Current Service Cost 37.63 33.48 12.87 41.32 32.14 12.23
3 Past Service Cost – – – – – –
4 Interest Cost 62.89 31.13 11.06 57.04 26.45 9.18
5 Remeasurement gains / (losses)
a. Effect of changes in demographic
assumptions 1.65 0.74 0.42 – – –
b. Effect of changes in financial
assumptions 25.08 17.30 6.00 (10.44) (13.10) (2.80)
c. Changes in asset ceiling (excluding
interest income) – – – – – –
d. Effect of experience adjustments (26.79) 23.27 0.60 (1.31) 26.27 8.33
6 Curtailment Cost / (Credits) – – – – – –
7 Settlement Cost / (Credits) – – – – – –
8 Liabilities assumed in business
combination – – – – – –
9 Effects of transfer In / (Out) (0.07) – – (0.06) – –
10 enefits Paid (80.63) (48.55) (14.00) (105.41) (48.41) (16.89)
11 Present a e o at t e
end of the year 898.65 496.77 171.48 878.89 439.40 154.53

(` in Crores)
V Best Estimate of Employers’ Expected
As at 31st March, 2024 As at 31st March, 2023
Contri tion or t e ne t ear

– Pension 41.28 86.28

– Gratuity 96.95 67.09

ITC Limited REPORT AND ACCOUNTS 2024 209

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

For the year ended For the year ended

31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Leave Leave
Pension Gratuity Pension Gratuity
Encashment Encashment

VI Change in Fair Value of Assets

1 Plan Assets at the beginning

of the year 854.51 423.43 – 882.68 401.92 –

2 Asset acquired in Business

Combination – – – – – –

3 Interest Income 66.54 33.08 – 58.63 27.86 –

4 Remeasurement Gains / (Losses)

on plan assets 21.85 3.45 – (13.71) (1.15) –

5 Actual Company Contributions 57.75 47.35 – 32.38 43.21 –

6 enefits Paid (80.63) (48.55) – (105.41) (48.41) –

7 Effects of transfer In / (Out) (0.07) – – (0.06) – –

8 P an ssets at t e en o t e ear 919.95 458.76 – 854.51 423.43 –

VII Actuarial Assumptions As at 31st March, 2024 As at 31st March, 2023

Discount Rate (%) Discount Rate (%)

1 Pension 7.00 7.50

2 Gratuity 7.00 7.50

3 Leave Encashment 7.00 7.50

The estimates of future salary increases, generally between 4% to 6%, considered in actuarial valuations take account of
in ation, seniority, promotion and other relevant factors such as supply and demand factors in the employment mar et.

VIII Ma or Categor o P an ssets as a

As at 31st March, 2024 As at 31st March, 2023
o t e ota P an ssets

1 Government Securities / Special

Deposit with RBI 15.32% 16.12%

2 High Quality Corporate Bonds 11.62% 11.06%

3 Insurer Managed Funds* 61.69% 63.00%

4 Mutual Funds 6.83% 5.09%

5 Cash and Cash Equivalents 4.54% 4.73%

6 Term Deposits – –

* In the absence of detailed information regarding plan assets which is funded with Insurance Companies, the composition
of each major category of plan assets, the percentage or amount for each category to the fair value of plan assets has
not been disclosed.

The fair value of Government securities, corporate bonds and mutual funds are determined based on quoted market prices
in active mar ets. The employee benefit plans do not hold any securities issued by the Company.

210 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

IX asis se to eter ine t e e te Rate o Ret rn on P an ssets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market
scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well
diversified.

For the year ended For the year ended

31st March, 2024 31st March, 2023
(` in Crores) (` in Crores)

Pension Gratuity Leave Pension Gratuity Leave

Encashment Encashment
X Net sset ia i it re ognise
in Balance Sheet (including experience
adjustment impact)
1 Present Value of Defined
enefit Obligation 898.65 496.77 171.48 878.89 439.40 154.53
2 Fair Value of Plan Assets 919.95 458.76 – 854.51 423.43 –
3 Status Surplus / (Deficit) 21.30 (38.01) (171.48) (24.38) (15.97) (154.53)
4 Experience Adjustment of
Plan Assets [Gain / (Loss)] 21.85 3.45 – (13.71) (1.15) –
5 Experience Adjustment of
obligation [(Gain) / Loss] (26.79) 23.27 0.60 (1.31) 26.27 8.33

XI Sensitivity Analysis
The Sensitivity Analysis below has been determined based on reasonably possible change of the respective assumptions
occurring at the end of the reporting period, while holding all other assumptions constant. These sensitivities show the
hypothetical impact of a change in each of the listed assumptions in isolation. While each of these sensitivities holds all
other assumptions constant, in practice such assumptions rarely change in isolation and the asset value changes may
partially offset this impact. For presenting the sensitivities, the present value of the Defined enefit Obligation has been
calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in
calculating the Defined enefit Obligation presented above. There was no change in the methods and assumptions used
in the preparation of the Sensitivity Analysis from previous year.
(` in Crores)

DBO as at 31st March, 2024 DBO as at 31st March, 2023

1 Discount Rate + 100 basis points 1479.71 1392.74

2 Discount Rate - 100 basis points 1664.94 1563.32
3 Salary Increase Rate + 1% 1658.44 1557.24
4 Salary Increase Rate – 1% 1483.91 1395.05

(` in Crores)

Mat rit na sis o t e enefit Pa ents As at 31st March, 2024 As at 31st March, 2023

1 Year 1 203.80 216.14

2 Year 2 266.30 214.54
3 Year 3 206.05 197.58
4 Year 4 131.17 182.67
5 Year 5 108.20 115.26
6 Next 5 Years 570.92 499.51

ITC Limited REPORT AND ACCOUNTS 2024 211

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

(b) Amounts towards Defined Contribution Plans have been recognised under Contribution to Provident and other funds in
Note 24: ` 113.44 Crores (2023 - ` 101.41 Crores).
(vii) Leases:
As a Lessee
The Company’s significant leasing arrangements are in respect of operating leases for land, buildings (comprising licensed
properties, residential premises, office premises, stores, warehouses etc.) and plant equipment. These arrangements
generally range between 2 years and 10 years, except for certain land and building leases where the lease term ranges up
to 99 years. The lease arrangements have extension / termination options exercisable by either parties which may make the
assessment of lease term uncertain. While determining the lease term, all facts and circumstances that create an economic
incentive to exercise an extension option, or not exercise a termination option are considered.
The amount of ROU Assets and Lease Liabilities recognised in the Balance Sheet are disclosed in Note 3G and Note 15
respectively. The total cash out ow for leases for the year is ` 414.06 Crores (2023 - ` 412.57 Crores) [including payments of
` 324.74 Crores (2023 - ` 329.16 Crores) in respect of short-term / low-value leases and variable lease payments of ` 6.84 Crores
(2023 - ` 5.90 Crores)].
The sensitivity of variable lease payments and effect of extension / termination options not included in measurement of lease
liabilities is not material.
The undiscounted maturities of lease liabilities over the remaining lease term is as follows:
(` in Crores)
Term As at 31st March, 2024 As at 31st March, 2023

Not later than three years 166.40 172.10

Later than three years and not later than ten years 159.66 167.52
Later than ten years and not later than twenty-five years 211.92 216.82
Later than twenty-five years and not later than fifty years 201.71 205.12
Later than fifty years 184.74 192.86

As a Lessor
The Company has leased out its investment properties etc. under operating lease for periods ranging upto 30 years. Lease
payments are structured with periodic escalations consistent with the prevailing market conditions. There are no variable lease
payments. The details of income from such leases are disclosed under Note 3C and Note 22. The Company does not have any
risk relating to recovery of residual value of investment property at the end of leases considering the business requirements and
other alternatives.
The undiscounted minimum lease payments to be received over the remaining non-cancellable term on an annual basis are
as follows:
(` in Crores)
Term As at 31st March, 2024 As at 31st March, 2023

1st year 18.53 1.43

2nd year 18.39 0.89
3rd year 8.33 0.75
4th year 0.84 0.61
5th year 0.88 0.64
Beyond 5 years 26.62 26.31

(viii) Under the terms of the Joint Venture Agreement (JVA), Logix Developers Private Limited (LDPL) (CIN: U70101DL2010PTC207640)
was to develop a luxury hotel-cum-service apartment complex. However, Logix Estates Private Limited, Noida, the JV partner
communicated its intention to explore alternative development plans to which the Company reiterated that it was committed only
to the project as envisaged in the JVA. The JV partner refused to progress the project and instead expressed its intent to exit
the V by selling its sta e to the Company and subsequently proposed that both parties should find a third party to sell the entire
shareholding in LDPL. The resultant deadlock has stalled the project. The Company’s petition that the affairs of the JV are being
conducted in a manner that is prejudicial to the interest of the Company and the JV entity, as also a petition for winding up of
LDPL filed by Logix Estates, are currently before the Hon’ble National Company Law Tribunal.

212 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

New Okhla Industrial Development Authority (NOIDA), vide letter dated 6th July, 2022, cancelled the sub-lease for the land on which
the pro ect was to be constructed on account of non-payment of lease installments and non-fulfilment of the conditions of the sub-lease,
including forfeiture of the amount deposited. Upon cancellation of the sub-lease, LDPL is evaluating all options to pursue its rights.
The financial statements of LDPL for the year ended 31st March, 2024 are yet to be approved by its oard of Directors.
(ix) During the year, the Company acquired, in aggregate, 2,443 Equity Shares of Rs. 10/- each and 9,571 Compulsorily Convertible
Preference Shares of Rs. 10/- each of Sproutlife Foods Private Limited (‘Sproutlife’) for an aggregate consideration of ` 225.00 crores
(Refer Note 4), consequent to which the Company’s shareholding in Sproutlife aggregated 44.74% of its share capital, on a fully diluted
basis, as on 31st March, 2024. Sproutlife became an associate of the Company with effect from 4th May, 2023.
The Company has agreed to acquire 100% of the share capital (on a fully diluted basis) of Sproutlife over a time period of about three to
four years from the execution of the transaction documents. Further infusion of ` 30 crores will be made through a primary subscription
by 31st March, 2025 or such other later date as may be mutually agreed upon, based on pre-agreed pre-money valuation, taking the
Company’s shareholding in Sproutlife to 47.5%, on a fully diluted basis.
The consideration for acquisition of the balance sta e of 52.5 will be determined based on pre-agreed valuation criteria and fulfilment
of applicable terms and conditions.
(x) During the year, the Company has divested its entire shareholding, i.e., 26.00% of the paid-up share capital, held in Espirit Hotels
Private Limited (Espirit), consequent to which Espirit ceased to be a joint venture of the Company.
(xi) The Ministry of Corporate Affairs (MCA) had issued the Companies (Indian Accounting Standards) (Amendment) Rules, 2023 on
31st March, 2023 amending the following Ind AS, which are effective for annual periods beginning on or after 1st April, 2023:
Ind AS 1, ‘Presentation of Financial Statements’ - This amendment requires companies to disclose their material accounting policies
rather than their significant accounting policies. Consequently, the Company has disclosed material accounting policies. There is no
impact on the standalone financial statements.
Ind AS 12 ‘Income Taxes’ - This amendment has narrowed the scope of the initial recognition exemption so that it does not apply
to transactions that give rise to equal and offsetting temporary differences. The amendments clarify how companies account for
deferred tax on transactions such as leases.
The Company previously recognised for deferred tax on leases on a net basis. Pursuant to the aforementioned amendment,
the Company has grossed-up the deferred tax assets (DTA) and deferred tax liabilities (DTL) recognised in relation to leases by
` 70.05 Crores each w.e.f. 1st April, 2022. However, the said gross-up has no impact on the net deferred tax liabilities / expense
presented in the standalone financial statements.
(xii) Information in respect of Options granted under the Company’s Employee Stock Option Schemes (‘Schemes’):
Sl. ITC Employee Stock Option ITC Employee Stock Option
No. Scheme - 2006 Scheme - 2010
1. Date of Shareholders’ approval : 22-01-2007 23-07-2010
2. Total number of Options :
approved under the Schemes Options equivalent to 37,89,18,503 Options equivalent to 55,60,44,823
(Adjusted for Bonus Shares issued Ordinary Shares of `1.00 each Ordinary Shares of `1.00 each
in terms of Shareholders’ approval)
3. Vesting Schedule : The vesting period for conversion of Options is as follows:
On completion of 12 months from the date of grant of the Options : 30% vests
On completion of 24 months from the date of grant of the Options : 30% vests
On completion of 36 months from the date of grant of the Options : 40% vests
4. Pricing Formula : The Pricing Formula, as approved by the Shareholders of the Company, is such price,
as determined by the Nomination Compensation Committee, which is no lower than
the closing price of the Company’s Share on National Stock Exchange of India Limited
(‘the NSE’) on the date of grant, or the average price of the Company’s Share in the
six months preceding the date of grant based on the daily closing price on the NSE, or the
mar et price’ as defined from time to time under the Securities and Exchange oard of
India (Share ased Employee enefits and Sweat Equity) Regulations, 2021.
The Options have been granted at mar et price’ as defined under the aforesaid Regulations.
5. Maximum term of Options : Five years - the exercise period commences from the date of vesting of the Options granted
granted and expires at the end of five years from the date of vesting.
6. Source of Shares : Primary
7. Variation in terms of Options : None

ITC Limited REPORT AND ACCOUNTS 2024 213

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

Sl. ITC Employee Stock Option ITC Employee Stock Option

No. Scheme - 2006 Scheme - 2010

8. Method used for accounting : The employee compensation cost has been calculated using the fair value method of
of share-based payment plans accounting for Options issued under the Company’s Employee Stock Option Schemes.
and effect of employee share The employee compensation cost as per fair value method for the financial year 2023-24
based plans on the entity’s is ` 103.10 Crores (2023 - ` 58.50 Crores); for the group entities, such compensation cost
profit or loss for the period and is ` 5.54 Crores (2023 - ` 2.61 Crores) [Refer Note 24].
on its financial position

9. Nature and extent of employee : In addition to the terms and conditions provided in the table under Serial Nos. (3) to (5)
share based payment plans hereinbefore, each Option entitles the holder thereof to apply for and be allotted
that existed during the period ten Ordinary Shares of the Company of `1.00 each upon payment of the exercise price
including the general terms during the exercise period.
and conditions of each plan

10. Weighted average exercise : Weighted average exercise price per Option : ` 4530.73
prices and weighted average Weighted average fair value per Option : ` 1064.83
fair values of Options whose
exercise price either equals
or exceeds or is less than the
market price of the stock

11. Option movements during : ITC Employee Stock Option ITC Employee Stock Option
the year Scheme - 2006 Scheme - 2010

a) Options outstanding at the : 2,85,808 1,29,23,671

beginning of the year

b) Options granted during : – 15,16,450

the year

c) Options cancelled and : 955 59,989

lapsed during the year

d) Options vested and : 43,950 8,36,370

exercisable during the year
(net of Options lapsed and
exercised)

e) Options exercised during : 87,039 55,83,334

the year

f) Number of Ordinary : 8,70,390 5,58,33,340

Shares of ` 1.00 each
arising as a result of
exercise of Options during
the year

g) Options outstanding at the : 1,97,814 87,96,798

end of the year (a+b-c-e)

h) Options exercisable at the : 1,71,284 58,80,098

end of the year

i) Money realised by exercise : 20.74 1422.09

of the Options during the
year (` in Crores)

214 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

12. Summary of the status of Options:

Parti ars As at 31st March, 2024 As at 31st March, 2023

No. of Options Weighted Average No. of Options Weighted Average

er ise Pri es (`) er ise Pri es (`)

Outstanding at the beginning : 1,32,09,479 2655.20 2,27,68,731 2469.30

of the year

Add: Granted during the year : 15,16,450 4530.73 13,76,300 3460.70

Less: Lapsed during the year : 60,944 2739.44 4,59,371 2477.37

Less: Exercised during the year : 56,70,373 2544.51 1,04,76,181 2364.79

Outstanding at the end : 89,94,612 3040.61 1,32,09,479 2655.20

of the year

Options exercisable at the end : 60,51,382 2657.61 1,07,05,124 2603.17

of the year

13. Weighted average share : The weighted average share price of Shares, arising upon exercise of Options during the
price of Shares arising upon year ended 31st March, 2024 was ` 455.45 (2023 - ` 315.92). This was based on the
exercise of Options closing market price on NSE on the date of exercise of Options (i.e. the date of allotment
of shares by the Securityholders Relationship Committee).

14. Summary of Options outstanding, scheme-wise:

Parti ars As at 31st March, 2024 As at 31st March, 2023

No. of Range of Weighted No. of Range of Weighted

Options Exercise average Options Exercise average
Outstanding Pri es (`) remaining Outstanding Pri es (`) remaining
contractual life contractual life

ITC Employee Stock Option : 1,97,814 1698.00 – 3463.50 3.19 2,85,808 1698.00 – 3463.50 3.44
Scheme - 2006

ITC Employee Stock Option : 87,96,798 1698.00 – 4534.50 3.37 1,29,23,671 1698.00 – 3463.50 2.50
Scheme - 2010

15. A description of the method : The fair value of each Option is estimated using the Black Scholes Option Pricing model.
used during the year to estimate
Weighted average exercise price per Option : ` 4530.73
the fair values of Options, the
weighted average exercise Weighted average fair value per Option : ` 1064.83
prices and weighted average
fair values of Options granted

The significant assumptions : The fair value of each Option is estimated using the Black Scholes Option Pricing model
used to ascertain the above after applying the following key assumptions on a weighted average basis:

(i) Risk-free interest rate 7.28%

(ii) Expected life 4.61 years

(iii) Expected volatility 23.69%

(iv) Expected dividends 3.41%

(v) The price of the underlying shares in market at the time of Option grant ` 4530.73
(One Option = Ten Ordinary Shares)

ITC Limited REPORT AND ACCOUNTS 2024 215

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

16. Methodology for determination : The volatility used in the Black Scholes Option Pricing model is the annualised standard
of expected volatility deviation of the continuously compounded rates of return on the stock over a period of
time. The period considered for the working is commensurate with the expected life of
the Options and is based on the daily volatility of the Company’s stock price on NSE. The
Company has incorporated the early exercise of Options by calculating expected life on
past exercise behaviour. There are no market conditions attached to the grant and vest.
17. Options granted to : As provided below:-
(a) Directors and Name Designation No. of Options granted
Senior managerial personnel ring t e finan ia ear
2023-24

1 S. Puri Chairman Managing Director 1,34,500

2 S. Dutta Executive Director 67,250

Chief Financial Officer

3 H. Malik Executive Director 18,750

4 B. Sumant Executive Director 67,250

5 S. Kaul Group Head - ITD, MAB, Start-up 18,750

Ventures, LSTC uality

6 A. K. Rajput President - Corporate Affairs 18,750

7 S. Sivakumar Group Head - Agri Business, IT, 18,750

Sustainability, CSR EHS
8 R. K. Singhi Executive Vice President 11,050
Company Secretary

The aforesaid Options were granted at the exercise price of ` 4534.50 per Option, being the ‘market price’ as defined under
the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.
(b) Any other employee who received a grant on any : None
one year of Options amounting to 5% or more of the
Options granted during the year.
(c) Identified employees who were granted Options, : None
during any one year, equal to or exceeding 1% of the
issued capital (excluding outstanding warrants and
conversions) of the Company at the time of grant.

(xiii) Information in respect of Stock Appreciation Linked Reward Plan:

Sl.
Parti ars Details
No.
1 Nature and extent of Stock : ITC Employee Cash Settled Stock Appreciation Linked Reward Plan
Appreciation Linked Reward Plan (ITC ESAR Plan).
that existed during the year along
Under the ITC ESAR Plan, the eligible employees receive cash on vesting of SAR
with general terms and conditions
units, equivalent to the difference between the grant price and the market price
of the share on vesting of SAR units sub ect to the terms and conditions specified
in the Plan.

2 Settlement Method : Cash – Settled

3 Vesting period and maximum term : Over a period of five years from the date of grant in accordance with the Plan.
of SAR granted

216 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

Sl.
Parti ars Details
No.
4 Method used to estimate the fair : Black Scholes Option Pricing model. The said model considers inputs such as
value of SAR granted Risk-free interest rate, Expected life, Expected volatility, Expected dividend,
Market price etc. The number of SAR units outstanding as at 31st March, 2024 is
9,31,606 (2023 - 25,00,251) and the weighted average fair value at measurement
date is ` 1103.96 (2023 - ` 980.89) per SAR unit.
5 Total cost recognised in the profit or : The cost has been calculated using the fair value method of accounting for
loss SAR units issued under the ITC ESAR Plan. The employee benefits expense
as per fair value method for the financial year 2023-24 is ` 32.06 Crores
(2023 - ` 208.62 Crores) and ` 1.43 Crores (2023 - ` 7.51 Crores) for group
entities (Refer Note 24). The amount carried in the Balance Sheet as a non -
current financial liability is ` 13.76 Crores (2023 - ` 69.38 Crores) and as a current
financial liability is ` 71.14 Crores (2023 - ` 118.80 Crores) (Refer Note 16).

(xiv) Trade Payables ageing schedule: (` in Crores)

Outstanding for following periods from due

date of payment as at 31st March, 2024
Not Due Total
Less than 1-2 2-3 More than
1 year years years 3 years
MSME 31.86 – – – – 31.86
Others 639.77 26.35 1.69 – – 667.81
Disputed Dues – MSME – – – – – –
Disputed Dues – Others – – – – 0.28 0.28
SUB-TOTAL 671.63 26.35 1.69 – 0.28 699.95
Accrued Payables (not due)
– MSME 174.99
– Others 3614.61
TOTAL 4489.55

(` in Crores)
Outstanding for following periods from due
date of payment as at 31st March, 2023
Not Due Total
Less than 1-2 2-3 More than
1 year years years 3 years
MSME 44.01 – – – – 44.01
Others 582.85 20.12 – – – 602.97
Disputed Dues – MSME – – – – – –
Disputed Dues – Others – – – – 0.28 0.28
SUB-TOTAL 626.86 20.12 – – 0.28 647.26
Accrued Payables (not due)
– MSME 93.49
– Others 3610.51
TOTAL 4351.26

ITC Limited REPORT AND ACCOUNTS 2024 217

Notes to the Standalone Financial Statements

28. Additional Notes to the Financial Statements (Contd.)

(xv) Micro, Small and Medium scale business entities:

There are no Micro, Small and Medium Enterprises to whom the Company owes dues, which are outstanding for more than
45 days during the year and also as at 31st March, 2024. This information as required to be disclosed under the Micro, Small
and Medium Enterprises Development Act, 2006 (MSMED Act, 2006) has been determined to the extent such parties have been
identified on the basis of information available with the Company.
(` in Crores)
31st March, 2024 31st March, 2023
(a) Principal amount remaining unpaid to any supplier as at the end of the
accounting year
– On account of trade payables 206.85 137.50
– On account of liabilities other than trade payables 36.41 33.70
– Total 243.26 171.20
(b) Interest due thereon remaining unpaid to any supplier as at the end of the – –
accounting year
(c) Amount of interest paid under MSMED Act, 2006 along with the amounts of the – –
payment made to the supplier beyond the appointed day during the accounting year
(d) Amount of interest due and payable for the period of delay in making payment – –
(which has been paid but beyond the appointed day during the year but without
adding the interest specified under the MSMED Act, 2006)
(e) Amount of interest accrued and remaining unpaid at the end of accounting year – –
(f) Amount of further interest remaining due and payable even in the succeeding – –
year, until such date when the interest dues as above are actually paid to the
small enterprise
(xvi) Financial Ratios:
Ratio Numerator Denominator 31st March, 2024 31st March, 2023
Current Ratio (in times) Current Assets Current Liabilities 2.91 2.84
Return on Equity Profit for the year (before Average Shareholder’s
29.22 28.99
Ratio (in %) exceptional items) Equity
Inventory Turnover Ratio Gross Revenue from sale
Average Inventory 5.98 6.75
(in times) of products and services
Trade Receivables Gross Revenue from sale Average Trade
24.66 32.51
Turnover Ratio (in times) of products and services Receivables
COGS + Other
Trade Payables Turnover
Expenses – Non Cash Average Trade Payables 8.39 8.99
Ratio (in times)
Expenditure
Net Capital Turnover Gross Revenue from sale Working Capital (Current
2.94 3.05
Ratio (in times) of products and services Assets – Current Liabilities)
Profit for the year (before Gross Revenue from sale
Net Profit Ratio (in ) 29.42 26.91
exceptional items) of products and services
Return on Capital Profit before exceptional Average Capital
37.97 38.72
Employed (in %) items, interest and taxes Employed
Return on Time weighted average
Income from investment 8.91 6.79
Investment (in %)* Investment
Debt-Equity Ratio and Debt Service Coverage Ratio are not relevant for the Company as it has negligible debt.
* Improvement mainly on account of higher portfolio yields and dividend received during the year.
(xvii) Figures presented as “…” are below the rounding off norm adopted by the Company.
(xviii) Figures for the previous year are re-arranged, wherever necessary, to conform to the figures of the current period. The same
does not have any material impact on the standalone financial statements.
(xix) The standalone financial statements were approved for issue by the oard of Directors on 23rd May, 2024. Such financial
statements are required to be placed before the shareholders for adoption in terms of Companies Act, 2013.

218 ITC Limited REPORT AND ACCOUNTS 2024

Notes to the Standalone Financial Statements

29. Segment Reporting

(` in Crores)
2024 2023
External Inter Segment Total External Inter Segment Total
1. Segment Revenue - Gross
FMCG - Cigarettes 30596.59 – 30596.59 28206.83 – 28206.83
FMCG - Others 20922.47 44.36 20966.83 19081.48 41.02 19122.50
FMCG - Total 51519.06 44.36 51563.42 47288.31 41.02 47329.33
Hotels 2973.74 15.76 2989.50 2573.22 11.81 2585.03
Agri Business 8417.44 7374.39 15791.83 12314.86 5857.48 18172.34
Paperboards, Paper and Packaging 6535.96 1808.44 8344.40 7304.50 1776.85 9081.35
Segment Total 69446.20 9242.95 78689.15 69480.89 7687.16 77168.05
Eliminations (9242.95) (7687.16)
Gross Revenue from sale of products and services 69446.20 69480.89
2. Segment Results
FMCG - Cigarettes 19089.17 17927.06
FMCG - Others 1778.55 1374.18
FMCG - Total 20867.72 19301.24
Hotels 753.77 541.90
Agri Business 1254.43 1327.74
Paperboards, Paper and Packaging 1377.60 2293.99
Segment Total 24253.52 23464.87
Eliminations (196.05) 22.19
Total 24057.47 23487.06
Unallocated corporate expenses net of unallocated income (1067.88) (1167.72)
Profit e ore interest et an ta ation 22989.59 22319.34
Finance Costs (45.73) (41.81)
Interest earned on loans and deposits, income from current and
non-current investments, profit and loss on sale of investments etc. - Net 3379.48 2400.01
Exceptional items Refer Note 2 (i) (7.57) 72.87
Profit e ore ta 26315.77 24750.41
Tax expense (5893.80) (5997.10)
Profit or t e ear 20421.97 18753.31

3. t er In or ation 2024 2023

Segment Segment Segment Segment
Assets ia i ities Assets ia i ities
FMCG - Cigarettes 9160.85 5248.89 7290.67 5056.90
FMCG - Others 12500.83 2501.71 11966.57 2351.99
FMCG - Total 21661.68 7750.60 19257.24 7408.89
Hotels 6683.65 1157.29 6514.91 940.88
Agri Business 5024.81 1380.10 4114.31 1649.76
Paperboards, Paper and Packaging 9413.71 1257.39 9201.17 1315.17
Segment Total 42783.85 11545.38 39087.63 11314.70
Unallocated Corporate Assets / Liabilities 44543.75 3548.92 43174.11 3353.24
Total 87327.60 15094.30 82261.74 14667.94

ITC Limited REPORT AND ACCOUNTS 2024 219

 Notes to the Standalone Financial Statements

29. Segment Reporting (Contd.)

(` in Crores)
2024 2023
Capital Depreciation Capital Depreciation
expenditure and amortization expenditure and amortization
FMCG - Cigarettes 537.90 257.28 173.60 268.60
FMCG - Others 670.77 559.95 418.79 579.79
FMCG - Total 1208.67 817.23 592.39 848.39
Hotels 321.38 296.11 195.28 289.72
Agri Business 60.92 70.61 119.86 66.48
Paperboards, Paper and Packaging 726.15 359.65 744.48 347.99
Segment Total 2317.12 1543.60 1652.01 1552.58
Unallocated 300.78 104.22 181.90 110.15
Total 2617.90 1647.82 1833.91 1662.73
Non Cas e en it re Non Cas e en it re
ot er t an e re iation ot er t an e re iation
FMCG - Cigarettes 4.68 7.72
FMCG - Others 110.19 84.68
FMCG - Total 114.87 92.40
Hotels 6.11 7.31
Agri Business 52.81 27.68
Paperboards, Paper and Packaging 34.66 49.42
Segment Total 208.45 176.81

GEOGRAPHICAL INFORMATION
2024 2023
1. Revenue from external customers
– Within India 63121.70 59074.73
– Outside India 6324.50 10406.16
Total 69446.20 69480.89
2. Non-current assets
– Within India 28059.48 27082.45
– Outside India – …
Total 28059.48 27082.45

NOTES :
(1) The Company’s corporate strategy aims at creating multiple drivers of growth anchored on its core competencies. The Company is currently focused on
four business groups : FMCG, Hotels, Paperboards, Paper and Packaging and Agri Business. The Company’s organisational structure and governance
processes are designed to support effective management of multiple businesses while retaining focus on each one of them.
The Operating Segments have been reported in a manner consistent with the internal reporting provided to the Corporate Management Committee, which
is the Chief Operating Decision Maker.
(2) The business groups comprise the following :
FMCG : Cigarettes – Cigarettes, Cigars, etc.
: Others – Branded Packaged Foods Businesses (Staples & Meals; Snacks; Dairy & Beverages; Biscuits &
Cakes; Chocolates, Coffee & Confectionery); Education and Stationery Products; Personal Care
Products; Safety Matches and Agarbattis.
Hotels – Hoteliering.
Paperboards, Paper and Packaging – Paperboards, Paper including Specialty Paper and Packaging including Flexibles.
Agri Business – Agri commodities such as wheat, rice, spices, coffee, soya and leaf tobacco.
(3) The geographical information considered
for disclosure are: – Revenue within India.
– Revenue outside India.
(4) Segment results of FMC : Others’ are after considering significant business development, brand building and gestation costs of the randed Pac aged
Foods businesses and Personal Care Products business.
(5) As stock options and stock appreciation linked reward units are granted under the ITC ESOS and ITC ESARP respectively to align the interests of
employees with those of shareholders and also to attract and retain talent for the enterprise as a whole, the charge thereof do not form part of the segment
performance reviewed by the Corporate Management Committee.
(6) The Company is not reliant on revenues from transactions with any single external customer and does not receive 10% or more of its revenues from
transactions with any single external customer.

220 ITC Limited REPORT AND ACCOUNTS 2024