How Would Rs. 10,000 in ITC Have Fared Over the Last 20 Years?

The compound annual growth rate (CAGR) is a key metric when evaluating an investment's performance over a period. Let's consider the ITC stock and see how an initial investment of Rs. 10,000 would have performed over the last 20 years.

A Historical Perspective

Back in 1998, the price of 1 share of ITC was Rs. 600. An investment of Rs. 10,000 would have allowed you to acquire 16 shares.

- Bonus and Splits

2005 - Bonus 1:2: The number of shares doubled to 24. 2005 - Split FV 10 to 1: The shares were consolidated to 240. 2010 - Bonus 1:1: Shares doubled again to 480. 2016 - Bonus 1:2: The final number of shares became 720.

Current Market Price

As of today, the price of 1 share is Rs. 210. Thus, the total value of your investment if you had continued to hold all the shares would be:

720 times 210 Rs. 151,200

The CAGR over the period 1998-2021 is approximately 12%, indicating a healthy and consistent growth rate.

A More Detailed Scenario

Let's explore a more detailed scenario where you made the same initial Rs. 10,000 investment on August 31, 1998. On that day, the closing price of ITC on NSE was 14.66, allowing you to buy 682 shares.

- Additional Dividends and Adjustments

2005 - Bonus 1:2: Your shares would double to 1,023. 2005 - Split FV 10 to 1: These 1,023 shares would consolidate into 10,230. 2010 - Bonus 1:1: The number of shares would double to 20,460. 2016 - Bonus 1:2: The final count would be 30,690 shares.

Current Investment Value

With the current closing price of 319.85 per share, the total investment value amounts to:

30,690 times 319.85 Rs. 9,816,195

This indicates a phenomenal Compound Annual Growth Rate (CAGR) of around 35% over the 20-year period, showcasing the potential for significant returns on investment in ITC.

Consistent Dividends

It's also important to consider the consistent dividends paid by ITC. Here are a few snapshots of the dividends over the years:

ITC has consistently paid dividends, contributing to the overall investment return.

You can find more detailed information about these dividends through the official financial reports or stock market analytics.

Conclusion

With an initial Rs. 10,000 investment in 1998, one would have accumulated a substantial amount of wealth by the end of 2021. The ITC stock has proven to be a valuable long-term investment, exhibiting a significant compound annual growth rate.

Special Note:

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