Balance Sheet as at 31st March, 2021

As at As at
Note 31st March, 2021 31st March, 2020
(` in Crores) (` in Crores)
ASSETS
Non-current assets
(a) Property, Plant and Equipment 3A 18489.91 18932.57
(b) Capital work-in-progress 3B 3329.97 2776.31
(c) Investment Property 3C 376.56 385.36
(d) Goodwill 3D 577.20 –
(e) Other Intangible assets 3E 2004.32 519.45
(f) Other Intangible assets under development 3F 3.50 3.89
(g) Right of use assets 3G 726.84 680.17
(h) Financial Assets
(i) Investments 4 12950.38 13455.59
(ii) Loans 5 2.37 3.31
(iii) Others 6 72.45 13025.20 607.09 14065.99
(i) Other non-current assets 7 1231.62 39765.12 1364.71 38728.45
Current assets
(a) Inventories 8 9470.87 8038.07
(b) Financial Assets
(i) Investments 9 14046.71 17175.02
(ii) Trade receivables 10 2090.35 2092.00
(iii) Cash and cash equivalents 11 231.25 561.84
(iv) Other Bank Balances 12 3770.25 6281.43
(v) Loans 5 2.77 4.87
(vi) Others 6 1197.15 21338.48 1505.94 27621.10
(c) Other current assets 7 1006.07 31815.42 847.74 36506.91
TOTAL ASSETS 71580.54 75235.36
EQUITY AND LIABILITIES
Equity
(a) Equity Share capital 13 1230.88 1229.22
(b) Other Equity 57773.70 59004.58 62799.94 64029.16
Liabilities
Non-current liabilities
(a) Financial Liabilities
(i) Borrowings 14 5.28 5.63
(ii) Lease Liabilities 15 272.36 259.25
(iii) Other financial liabilities 16 239.35 516.99 90.47 355.35
(b) Provisions 17 157.07 143.79
(c) Deferred tax liabilities (Net) 18 1727.73 2401.79 1617.65 2116.79
Current liabilities
(a) Financial Liabilities
(i) Trade payables
Total outstanding dues of micro enterprises
and small enterprises 59.34 34.67
Total outstanding dues of creditors other than
micro enterprises and small enterprises 4060.19 3412.07
(ii) Lease Liabilities 15 51.36 64.87
(iii) Other financial liabilities 16 1248.17 5419.06 1147.24 4658.85
(b) Other current liabilities 19 4369.00 4175.91
(c) Provisions 17 169.05 117.94
(d) Current Tax Liabilities (Net) 20 217.06 10174.17 136.71 9089.41
TOTAL EQUITY AND LIABILITIES 71580.54 75235.36

The accompanying notes 1 to 30 are an integral part of the Financial Statements.

In terms of our report attached On behalf of the Board
For S R B C & CO LLP
Chartered Accountants R. TANDON Director S. PURI Chairman & Managing Director
Firm Registration Number: 324982E/E300003 Kolkata, India New Delhi, India
Sudhir Soni
Partner S. DUTTA Chief Financial Officer R. K. SINGHI Company Secretary
Mumbai, India Kolkata, India Kolkata, India
Dated: June 01, 2021 Dated: June 01, 2021

146 ITC Limited REPORT AND ACCOUNTS 2021

Statement of Profit and Loss for the year ended 31st March, 2021
Note For the year ended For the year ended
31st March, 2021 31st March, 2020
(` in Crores) (` in Crores)
I Revenue From Operations 21A, 21B 48524.54 46807.34
II Other Income 22 3250.99 3013.66
III Total Income (I+II) 51775.53 49821.00
IV EXPENSES
Cost of materials consumed 13605.07 13121.76
Purchases of Stock-in-Trade 6896.40 4289.71
Changes in inventories of finished goods, Stock-in-Trade,
work-in-progress and intermediates (526.86) (176.34)
Excise duty 3039.43 1187.64
Employee benefits expense 23 2820.95 2658.21
Finance costs 24 47.47 55.72
Depreciation and amortization expense 1561.83 1563.27
Other expenses 25 7167.09 7822.11
Total expenses (IV) 34611.38 30522.08
V Profit before exceptional items and tax (III-IV) 17164.15 19298.92
VI Exceptional Items – (132.11)
VII Profit before tax (V+VI) 17164.15 19166.81
VIII Tax expense:
Current Tax 26 4035.36 4441.97
Deferred Tax 26 97.15 (411.21)
IX Profit for the year (VII-VIII) 13031.64 15136.05
Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss:
– Remeasurements of the defined benefit plans 27(v) (30.10) (125.09)
– Equity instruments through other comprehensive
income 252.00 (1238.94)
– Effective portion of gains / (losses) on designated
portion of hedging instruments in a cash flow hedge (6.64) (1.29)
(ii) Income tax relating to items that will not be reclassified
to profit or loss 26 0.49 9.62
B (i) Items that will be reclassified to profit or loss:
– Effective portion of gains / (losses) on designated
portion of hedging instruments in a cash flow hedge 40.76 (36.24)
(ii) Income tax relating to items that will be reclassified
to profit or loss 26 (10.26) 10.13
X Other Comprehensive Income [A (i-ii)+B (i-ii)] 246.25 (1381.81)
XI Total Comprehensive Income for the year (IX+X) 13277.89 13754.24
XII Earnings per equity share (Face Value ` 1.00 each): 27(i)
(1) Basic (in `) 10.59 12.33
(2) Diluted (in `) 10.59 12.31

The accompanying notes 1 to 30 are an integral part of the Financial Statements.

In terms of our report attached On behalf of the Board
For S R B C & CO LLP
Chartered Accountants R. TANDON Director S. PURI Chairman & Managing Director
Firm Registration Number: 324982E/E300003 Kolkata, India New Delhi, India
Sudhir Soni
Partner S. DUTTA Chief Financial Officer R. K. SINGHI Company Secretary
Mumbai, India Kolkata, India Kolkata, India
Dated: June 01, 2021 Dated: June 01, 2021

ITC Limited REPORT AND ACCOUNTS 2021 147

148
Statement of changes in equity for the year ended 31st March, 2021
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

ITC Limited
For the year ended 31st March, 2020 1225.86 3.36 1229.22

For the year ended 31st March, 2021 1229.22 1.66 1230.88

B. Other Equity  (` in Crores)

Reserves and Surplus Items of other comprehensive income

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

REPORT AND ACCOUNTS 2021

Balance as at 31st March, 2019 2.48 8522.76 1997.94 0.30 363.05 17585.31 26978.13 1241.71 (8.30) 40.55 56723.93
Profit for the year – – – – – – 15136.05 – – – 15136.05
Other Comprehensive Income (net of tax) – – – – – – (113.54) (1238.94) (29.33) – (1381.81)
Total Comprehensive Income for the year – – – – – – 15022.51 (1238.94) (29.33) – 13754.24
Issue of equity shares under ITC Employee
Stock Option Schemes – 621.94 – – – – – – – – 621.94
Dividend
– Dividend 2018-19 – ` 5.75 per share – – – – – – (7048.71) – – – (7048.71)
Dividend distribution tax (paid) / refund received – – – – – – (1373.52) – – – (1373.52)
Transfer from Share Option Outstanding
Account on exercise and lapse – 66.79 (89.80) – – – 17.73 – – – (5.28)
Transferred to initial carrying amount of
hedged items (net of tax) – – – – – – – – 13.30 – 13.30
Recognition of share based payment – – 114.04 – – – – – – – 114.04
Balance as at 31st March, 2020 2.48 9211.49 2022.18 0.30 363.05 17585.31 33596.14 2.77 (24.33) 40.55 62799.94
Profit for the year – – – – – – 13031.64 – – – 13031.64
Other Comprehensive Income (net of tax) – – – – – – (29.66) 250.38 25.53 – 246.25
Total Comprehensive Income for the year – – – – – – 13001.98 250.38 25.53 – 13277.89
Issue of equity shares under ITC Employee
Stock Option Schemes – 288.99 – – – – – – – – 288.99
 Statement of changes in equity for the year ended 31st March, 2021
B. Other Equity (Contd.)  (` in Crores)
Reserves and Surplus Items of other comprehensive income
Equity
Share Instruments Effective Foreign Total
Options Capital through Other portion of Currency
Capital Securities Outstanding Redemption Contingency General Retained Comprehensive Cash Flow Translation
Reserve Premium Account Reserve Reserve Reserve Earnings Income Hedges Reserve
Dividends
– Final Dividend
(2019-20 – ` 10.15 per share) – – – – – – (12476.61) – – – (12476.61)
– Interim Dividend
(2020-21 – ` 5.00 per share) (6152.68) (6152.68)
Dividend distribution tax (paid) / refund received – – – – – – 13.98 – – – 13.98
Transfer from Share Option Outstanding
Account on exercise and lapse – 111.16 (342.32) – – – 222.96 – – – (8.20)
Transfer from Equity Instruments through
Other Comprehensive Income reserve on
renunciation of rights entitlements (net of tax) – – – – – – 4.82 (4.82) – – –
Transferred to initial carrying amount of
hedged items (net of tax) – – – – – – – – 3.73 – 3.73
Recognition of share based payment – – 26.66 – – – – – – – 26.66
Balance as at 31st March, 2021 2.48 9611.64 1706.52 0.30 363.05 17585.31 28210.59 248.33 4.93 40.55 57773.70

The Board of Directors of the Company have recommended Final Dividend of ` 5.75 per share for the financial year ended 31st March, 2021 to be paid on fully paid Equity Shares amounting to ` 7077.59 Crores. The Final Dividend is subject
to the approval of shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. Including the Interim Dividend of ` 5.00 per share declared by the Board of Directors, the total Equity Dividend
for the year ended 31st March, 2021 is ` 10.75 per share (total Equity Dividend for the year ended 31st March, 2020 - ` 10.15 per 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 or cancellation 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 is 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.

ITC Limited
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.
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 derivatives 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 30 are an integral part of the Financial Statements.
In terms of our report attached On behalf of the Board
For S R B C & CO LLP
Chartered Accountants R. TANDON Director S. PURI Chairman & Managing Director
Firm Registration Number: 324982E/E300003 Kolkata, India New Delhi, India

REPORT AND ACCOUNTS 2021

Sudhir Soni
Partner S. DUTTA Chief Financial Officer R. K. SINGHI Company Secretary
Kolkata, India Kolkata, India

149
Mumbai, India
Dated: June 01, 2021 Dated: June 01, 2021
Cash Flow Statement for the year ended 31st March, 2021
For the year ended For the year ended
31st March, 2021 31st March, 2020
(` in Crores) (` in Crores)
A. Cash Flow from Operating Activities
PROFIT BEFORE TAX 17164.15 19166.81
ADJUSTMENTS FOR:
Depreciation and amortization expense 1561.83 1563.27
Share based payments to employees 27.15 105.77
Finance costs 47.47 55.72
Interest Income (1224.82) (1438.87)
Dividend Income (723.94) (551.11)
Loss on sale of property, plant and equipment, lease termination - Net 55.04 56.08
Doubtful and bad debts 26.02 16.17
Doubtful and bad advances, loans and deposits 33.04 (1.71)
Impairment of investment in joint venture – 10.00
Net (gain) / loss arising on financial instruments mandatorily measured
at fair value through profit or loss (1107.53) (944.25)
Foreign currency translations and transactions - Net (13.00) (1318.74) 0.44 (1128.49)
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 15845.41 18038.32
ADJUSTMENTS FOR:
Trade receivables, advances and other assets (99.38) 1527.33
Inventories (1350.89) (450.83)
Trade payables, other liabilities and provisions 1055.43 (394.84) (658.50) 418.00
CASH GENERATED FROM OPERATIONS 15450.57 18456.32
Income tax paid (3956.62) (4650.14)
NET CASH FROM OPERATING ACTIVITIES 11493.95 13806.18
B. Cash Flow from Investing Activities
Purchase of property, plant and equipment, Intangibles, ROU asset etc. (1582.09) (2140.35)
Sale of property, plant and equipment 2.66 26.75
Purchase of current investments (51625.18) (74803.59)
Sale / redemption of current investments 56785.92 69214.00
Payment towards business combination [Refer Note 27 (ix)] (2176.26) –
Investment in subsidiaries (374.53) (202.39)
Investment in associate (1.87) –
Purchase of non-current investments (1488.71) (1987.78)
Redemption proceeds of non-current investments 1712.05 3429.63
Dividend Income 723.94 551.11
Interest received 1199.36 1437.26
Investment in bank deposits
(original maturity more than 3 months) (3706.02) (4666.57)
Redemption / maturity of bank deposits
(original maturity more than 3 months) 6259.37 3508.18
Investment in deposit with housing finance companies (78.38) (585.16)
Redemption / maturity of deposit with housing finance companies 844.43 699.15
Loans given (2.12) (3.22)
Loans realised 5.32 6.27
NET CASH FROM / (USED IN) INVESTING ACTIVITIES 6497.89 (5516.71)

150 ITC Limited REPORT AND ACCOUNTS 2021

Cash Flow Statement for the year ended 31st March, 2021
For the year ended For the year ended
31st March, 2021 31st March, 2020
(` in Crores) (` in Crores)
C. Cash Flow from Financing Activities
Proceeds from issue of share capital 290.65 625.30
Repayment of non-current borrowings (2.26) (3.23)
Payment of lease liabilities (49.67) (44.03)
Interest paid (43.47) (45.54)
Net increase / (decrease) in statutory restricted accounts balances 41.17 (1.14)
Dividend paid (18629.29) (7048.71)
Dividend distribution tax (paid) / refund received 13.98 (1373.52)
NET CASH USED IN FINANCING ACTIVITIES (18378.89) (7890.87)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS (387.05) 398.60
OPENING CASH AND CASH EQUIVALENTS 561.35 162.75
CASH AND CASH EQUIVALENTS ACQUIRED ON BUSINESS
COMBINATION [See Note 3 below] 56.95 –
CLOSING CASH AND CASH EQUIVALENTS 231.25 561.35

Notes:
1. The above Cash Flow Statement has been prepared under the “Indirect Method” as set out in Ind AS - 7 “Statement of Cash Flows”
2. CASH AND CASH EQUIVALENTS:
Cash and cash equivalents as above 231.25 561.35
Unrealised gain / (loss) on foreign currency cash and cash equivalents … 0.49
Cash and cash equivalents (Note 11) 231.25 561.84
3. Cash & Cash Equivalents include ` 56.95 Crores on acquisition of Sunrise Foods Private Limited during the period and is included
in the closing Cash and Cash Equivalents.
4. Net Cash Flow from Operating Activities includes an amount of ` 368.18 Crores (2020 - ` 322.06 Crores) spent towards Corporate
Social Responsibility.

The accompanying notes 1 to 30 are an integral part of the Financial Statements.

In terms of our report attached On behalf of the Board
For S R B C & CO LLP
Chartered Accountants R. TANDON Director S. PURI Chairman & Managing Director
Firm Registration Number: 324982E/E300003 Kolkata, India New Delhi, India
Sudhir Soni
Partner S. DUTTA Chief Financial Officer R. K. SINGHI Company Secretary
Mumbai, India Kolkata, India Kolkata, India
Dated: June 01, 2021 Dated: June 01, 2021

ITC Limited REPORT AND ACCOUNTS 2021 151