ABSTRACT
This chapter analyses the impact of financial leverage on shareholders wealth with the help of DuPont model. ITC is an Indian diversified conglomerate with operations in four segments, namely, FMCG, agribusiness, paperboards, paper and packaging and hotels. It is the largest FMCG company in Indian market in terms of market capitalisation. Major challenges were faced in the cigarette industry due to steep taxes being imposed in the current union budget. Apart from India, the company has its subsidiaries in the Netherlands, the United Kingdom, South Africa and Mauritius. The DuPont analysis was conducted for each of the companies to analyse their growth in the past three years. From the study of the various annual reports we have gathered the following information: Based on the studies of various ratios this chapter deduce that Colgate-Palmolive although sixth in the ranking per market capitalisation ranks the highest in terms of shareholders wealth maximisation.
