GROUP 3 – Sec.

B
 Established by the UK based Tobacco
major, BAT(1910)
 Imperial Tobacco Company of India
Ltd (1910)
 Tribeni Handlooms and
Bhadrachalam Paperboards(1981)
 In 1981 bought 33% stake in India
Cements from IDBI.
 ITC hotels in 1986
FMCG
•Cigarettes
• Foods
• Lifestyle Retailing
• Greeting, Gifting & Stationery
• Safety Matches
• Agarbattis

Paperboards & Packaging

• Paperboards & Specialty Papers
• Packaging
Agri - Business
• Agri-Exports
• e-Choupal
• Leaf Tobacco
Hotels
Information Technology
• ITC Infotech
 Feb 2001, GOI restricted the sale
and consumption of tobacco
products
 Restriction to advertise
 Rising excise duties and competition
smuggled products
 ITC’s core business contributes 85%
of the total revenue
 Other business -15%
 Total consumption was declining
from 104.2 billion(mar’98) – 97.8
billion(mar’01)

 30% decline in non filter cigarette

sales

 Annualgrowth of the smuggled

products were 25%
 ITC- market leader-78% share

 Godfrey Philips India Ltd.(GPIL) and

Vazir Sultan Tobacco(VST)- other
major players

 In
2001, ITC’s share was 70% with a
revenue of Rs 99.82 billion
 Wills Sport, Started in 2000
 Rs 2 billion brand by 2005(Vision)
 Invested Rs 2.5 billion
 Invested Rs 60 million on the design
production and technology center
 Positioned it as mid-priced brand
 In 2002, 50 Lifestyle stores across
India
 Turnover of Rs 450 million by mar’03
In 2000, Invested Rs 2.5 billion
“Expressions”
In 600 cities, 11000 multibrand outlets
It had 10000 designs
Launched “White Gold”- Premium bond
paper
In 2002, launched second range of greeting
cards under Expression
In 2003, planned to go for notebooks,
Stationery products, notepads
 In 2001, ITC formed the foods division
 Ready to serve gourmet, Confectionery
and chocolates, Biscults, Cookies
 entered the Rs 1.1 billion organized
Confectionery market with Minto and
Candyman
 It had both Vegetarian and Non-
vegetarian dishes
 In 2002, ITC launched ‘Aashirwaad’ and
entered the snack foods market
 Entered in 2002
 Mangaldeep, Aim, D’lite,Vaxlite,iKno
 No extra distribution cost
 No extra marketing costs
 Low value item
 Marketing expertise in building Strong
Brands.
 Ability to differentiate within its brands
and serve to a wide variety of segments
in a market.
 Mass and wide distribution capabilities.
In Clothing they created strong brands
Wills Sports, Wills Lifestyle, Wills Classic
Established a strong retail chain.
In Greeting cards , gifts and paper
Expressions, White gold, Classmate, etc
Foods business
Minto, Candyman, Aashirwaad atta, Sunfest
, Bingo, etc
Leveraging its distribution skills.
Safety Matches
Mangaldeep, Aim, D’lite, iKno, etc.
Leveraged its existing distribution and
production synigeries
 McKinsey report showed that food
and clothing were fastest growing
industries in India.
 Both markets lacked strong brands
and most brands were not widely
distributed
 Most brands were category specific
Business/ Year Growth Value (Rs in Crore)
% 2005 2004
FMCG-Cigarettes 8.4 10002.54 9230.27
FMCG-Others 85.2 563.39 304.16
Hotels 124.1 577.25 257.53

Agribusiness 4.2 1780.07 1708.77

Paper & pkg. 24.9 1565.31 1253.29
Net revenue 12.99 13349.58 11815.04
Category CAGR Growth parameters
Cigarettes 10.9 % Pricing power
Hotels 22.7% Inward traffic, occupancy
Paper 17.2 % Capacity utilization, value
added products
Agri 34.3 % e-Choupal
business
FMCG- 60.2 % Fast track, decent share.
Others
 Outstanding market leader
 Cigarettes, Hotels, Paperboards,
Packaging and Agri-Exports.
Gaining market share
 Nascent businesses of Packaged
Foods & Confectionery, Branded
Apparel and Greeting Cards.
Sta rs ?
•Hotels •FMCG- Others
•Paperboards/
Packaging.
•Agri business.
Cows Dogs
•FMCG-Cigarettes •Maybe ITC
Infotech.