ITC vs Hindustan Unilever Which Is More Reliable?

ITC and Hindustan Unilever are two of the leading companies in the consumer goods sector in India. While ITC is primarily known for its presence in the tobacco, hospitality, and FMCG segments, Hindustan Unilever focuses primarily on home and personal care products. Both companies have a strong market presence and a loyal customer base. Investors often compare the performance of these stocks to make informed decisions about their investment portfolio. This analysis will delve into the key differences and similarities between ITC and Hindustan Unilever stocks.

ITC or Hindustan Unilever?

When comparing ITC and Hindustan Unilever, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between ITC and Hindustan Unilever.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. ITC has a dividend yield of 2.99%, while Hindustan Unilever has a dividend yield of 1.45%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. ITC reports a 5-year dividend growth of 11.18% year and a payout ratio of 0.00%. On the other hand, Hindustan Unilever reports a 5-year dividend growth of 13.75% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with ITC P/E ratio at 28.06 and Hindustan Unilever's P/E ratio at 53.65. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. ITC P/B ratio is 7.66 while Hindustan Unilever's P/B ratio is 10.85.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, ITC has seen a 5-year revenue growth of 0.44%, while Hindustan Unilever's is 0.46%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with ITC's ROE at 27.92% and Hindustan Unilever's ROE at 20.13%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹459.15 for ITC and ₹2338.00 for Hindustan Unilever. Over the past year, ITC's prices ranged from ₹399.35 to ₹528.50, with a yearly change of 32.34%. Hindustan Unilever's prices fluctuated between ₹2172.05 and ₹3035.00, with a yearly change of 39.73%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.