“When the good, the bad & the ugly trade together; the valuations given that are of the ugly.”

— Bharat Shah

Greetings from SOIC!

Dear Tribe Member, the benefits and drawbacks of a Conglomerate can only be understood once you dive deep and assess different business segments housed in it. ITC, the grand conglomerate from our stock markets, has been one such enigma among investors for the last 5-6 years. Firstly due to its underperformance for the past 5 years and now because of amazing exuberance in the last 1 year.

Recently, ITC has announced a demerger of its Hotel business into a separate entity. This is one topic that drew a lot of attention from retail investors. Today we analyse the conglomerate structure of ITC and look at various other examples. Particularly in the case of ITC we’ll at.

👉ITC’s Conglomerate Structure

👉Reasons for ITC’s outperformance

👉Contribution from various Business Segments

👉Demerger of Hotel Business explained

👉Sum of the Parts (SOTP) Valuations