ITC Limited

One of Indias Most Admired and Valuable Companies

ITC Performance Track Record

Rs crs 1995-96 Net Revenue PBDIT PBIT PBT PAT Capital Employed ROCE % Market Capitalisation Total Shareholder Returns %
Market Cap and TSR based on FY-end prices

2012-13 29,606 11,566 10,771 10,684 7,418 23,569 45.7 244246

17-yr Cagr 95-96 to 12-13 15.6% 19.2% 19.3% 20.4% 21.8% 16.0% 24.9% 26.4%

2,536 584 536 452 261 1,886 28.4 5,571

Sensex (CAGR 95-96 to 12-13) : 10.7%

2

Consistency of Performance

Consistent performance over 17 year, 10 year, 5 year and 3 year horizons

In terms of Revenue, Profits, TSR Vs. Sensex
95-96 to 12-13 17 years 13.2% 21.8% 26.4% 10.7% 02-03 to 12-13 10 years 14.3% 18.4% 33.9% 20.0% 07-08 to 12-13 5 years 14.5% 18.9% 26.7% 3.8% 09-10 to 12-13 3 years 16.9% 22.2% 35.0% 2.4%

CAGR GTO PAT TSR Sensex

TSR and Sensex returns are based on Mar-end of each FY

Rate of growth has accelerated further in the last three years

ITCs ranking
Amongst all listed private sector cos. PBT: No. 6 PAT: No. 5 Market Capitalisation: No. 3

Note: Based on Published Results for H1 FY14, Market Capitalisation based on 31st Dec 2013

ITC is the only Indian Company to be ranked amongst the Top 10 global FMCG companies in value creation during the period 20082008-12
(Boston Consulting)

One of Indias most valuable and admired companies

One of the foremost in the private sector in terms of : Sustained value creation (BT-Stern Stewart survey) Operating profits Cash Profits Only Indian FMCG Company to feature in Forbes 2000 List

A comprehensive ranking of worlds biggest companies measured by a composite of sales, profits, assets & market value

Also ranked amongst the Top 10 global FMCG companies in terms of value creation during the period 2005-2009 by Boston Consulting Group. Is the only Indian company to feature consistently amongst the Top 10 global FMCG companies.
6

Awards & Accolades (1)

Harvard Business Review ranked ITC Chairman Y C Deveshwar as the 7th Best Performing CEO in the World Chairman Y C Deveshwar was conferred the Padma Bhushan by the Government of India (2011)

ITC conferred the prestigious World Business and Development Award 2012 at the Rio+20 UN Summit for its Social and Farm Forestry Initiatives

ITC Grand Chola, the worlds largest LEED Platinum rated hotel in the New Construction category, launched in September 2012

Awards & Accolades (2)

AIM Asian CSR Award by the Asian Forum on Corporate Social Responsibility

Rainforest Alliance awarded ITC's Bhadrachalam Unit, the Forest Stewardship Council Forest Management certification

Businessworld FICCI CSR award in Large Enterprise category

Hotels awarded the Most Trusted Hotel brand in the Public Choice Honours category at the Times Travel Honours

Best Overall Corporate Social Responsibility Performance : Institute of Public Enterprise

Accolades & Awards (3)

e-Choupal initiative wins global recognition:
World Development Report 2008 published by World Bank Stockholm Challenge Award 2006 in the Economic Development category which recognises initiatives that leverage Information Technology to improve living conditions and foster economic growth in all parts of the world. First Indian Company and second in the world to win the Development Gateway Award 2005 for its trailblazing e-Choupal initiative Corporate Social Responsibility Award from The Energy and Resources Institute (TERI) World Business Award 2004: International Chamber of Commerce & the HRH Prince of Wales & International Business forum Harvard University case study Applauded by the then President of India Dr APJ Kalam in his special address during the national symposium to commemorate 60th year of Independence
9

ITCs Vision

Sustain ITCs position as one of Indias most valuable corporations through world class performance, creating growing value for the Indian economy and the Companys stakeholders

10

ITCs Vision
Make a significant and growing contribution towards : mitigating societal challenges enhancing shareholder rewards By creating multiple drivers of growth while sustaining leadership in tobacco and focusing on Triple Bottom Line Performance
Enlarge contribution to the Nations
- Financial capital - Environmental capital - Social capital

11

Key Corporate Strategies

Focus on the chosen business portfolio
FMCG; Hotels; Paperboards, Paper & Packaging; Agri Business, Information Technology

Blend diverse core competencies residing in various businesses to enhance the competitive power of the portfolio Position each business to attain leadership on the strength of world class standards in quality and costs Craft appropriate strategy of organisation and governance process to :
Enable focus on each business and Harness diversity of portfolio to create unique sources of competitive advantage

12

ITC Business Portfolio

FMCG
Cigarettes Foods Personal Care Lifestyle Retailing

Education & Stationery

Matches

Incense Sticks

Hotels

Paperboards, Paper & Packaging

Agri Business

Information Technology

13

Strategy of Organisation to manage diversity of Portfolio

Formal 3-tiered governance structure:

Board of Directors : Comprising executive (4) and non-executive directors (10) Strategic supervision Corporate Management Committee : Comprising executive directors and senior managers Strategic management Divisional Chief Executive & Divisional Management Committee : Executive management

14

FMCG - Cigarettes

ITCs Cigarettes Business

Market leadership Leadership across all segments - geographic & price Extensive FMCG distribution network Direct servicing of 1,00,000 markets & 2 million retail outlets State-of-the-art technology and world class products

16

Cigarette Industry in India

Cigarettes account for less than 15% of tobacco consumed in India unlike world pattern of 85% due to prolonged punitive taxation Cigarettes (15% of tobacco consumption) contribute the bulk of Revenue to the Exchequer from tobacco sector 48% of adult Indian males consume tobacco. Only 10% of adult Indian males smoke cigarettes as compared to 16% who smoke biris and 33% who use smokeless tobacco (Source: Global Adult Tobacco Survey India 2010) Annual per capita adult cigarette consumption in India is appx. one ninth of world average

17

Per Capita Consumption of Tobacco in India (gms per year)

1256 1145

743 461 468

438

China

USA

Pakistan

Nepal

India

World

Source:World Cigarettes ERC Statistics, Tob Board & Industry Estimates gms/Yr

Per Capita consumption is ~60% of World Average

18

Per Capita Cigarette Consumption per annum

2786

No. of cigarettes per capita per annum

1841

1711

1028 468

420 154 96
India

Russian Federation Japan

China

USA

Pakistan

Nepal

Bangladesh

Source: The Tobacco Atlas - 4th Edition (American Cancer Society), 2012

Per Capita consumption in India ~11% of World average

FMCG - Others
Drivers of Growth & Value Capture - New FMCG Initiatives

20

Rapid Scale up of FMCG businesses

Rs. crs

7012 5545

4482 3642 3014 2511 1704 1013 563

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

2012-13

21

Creating world-class brands for Indian Consumers

22

Branded Packaged Foods

Biscuits, Staples, Snacks, Confectionery, Ready to Eat & Noodles

23

Branded Packaged Foods

Amongst one of the fastest growing Foods business in the country
Bakery and Confectionery Foods - Biscuits, Confectionery Snack Foods - Savoury Snacks, Noodles and Pasta Staples, Spices and Ready to Eat Foods - Atta, Salt, Spices, Ready to Eat (RTE)

Driven by strong brands Aashirvaad Staples (Wheat flour, Salt, Spices), Ready to Eat Ready Meals, Instant Mixes Atta (wheat flour) - #1 in Branded packaged Atta among national players Biscuits - #3 All India Noodles - #2 All India Savoury Snacks - #2 All India Confectionery - #3 in Sugar Confectionery Ready-to-Eat - Leveraging expertise of Hotels business. Premium Conserves/Chutneys first in India
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Sunfeast Biscuits, Noodles and Pasta

Bingo! Yumitos Potato Chips, Finger Snacks Mad Angles, Tedhe Medhe, Tangles mint-o & Candyman Confectionery Kitchens of India Ready Meals, Premium conserves, chutneys & Cooking sauces

Education & Stationery

Products

Notebooks Writing Instruments (Pen, Pencils etc) Scholastic products

Brands

Classmate Paperkraft

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Education & Stationery Products Business

Leverages print and paper know-how to address suitable opportunities in the stationery market.

An emerging (currently `11000 crs Stationery) market in India - growth driven by increasing cross-cultural exposure, government spending on education
Classmate and Paperkraft continue to gain consumer franchise Classmate : Market leader in Notebooks segment

26

Lifestyle Retailing

Enhanced lustre & premiumness to brand Wills to a position of eminence Offering a Lifestyle proposition with portfolio straddling multiple genres Wills Lifestyle - a fashion destination, offers a choice of super-premium formals for men, designer, work, relaxed & evening wear and fashion accessories John Players embodies the spirit of the modern youth that is playful, fashionable and cool

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Lifestyle Retailing
Upmarket product range available in exclusive Wills Lifestyle stores (95) across 40 cities and more than 500 shop-in-shops in leading departmental stores and multi-brand outlets. Strong distribution network in place for the mid-market brand John Players availability in more than 400 Exclusive Branded outlets, 1500 multi branded outlets and departmental stores Wills Lifestyle rated amongst the Top 5 Luxury brands in India (TIME magazine) John Players is the 2nd largest brand in the Youth segment Club ITC a pan-ITC consumer loyalty programme is fast gaining traction among premium clientele of Will Lifestyle and ITC Hotels.
28

Safety Matches & Incense sticks (Agarbattis)

29

Safety Matches & Incense sticks (Agarbattis)

Current Safety Matches & Incense sticks industry consumer spend estimated at ~ ` 6,700 crores AIM Indias largest selling Safety Matches brand Mangaldeep : Indias second largest selling Incense sticks brand ITC markets its brands with value-added products across price points ITCs Matches & Incense sticks businesses provide livelihood opportunities to more than 18000 people

30

Personal Care
Brands:
Essenza Di Wills Fiama Di Wills Vivel Superia Engage

Product portfolio: Personal Wash (Soaps, Shower Gel)

Hair Care

(Shampoo, Conditioner)
Skin Care

(Skin Cream, Face Wash etc.)

Deodorants Talc

31

Personal Care Products

Current market size estimated at over ` 40,000 crores (growing at 12% p.a.) Portfolio approach straddling all consumer segments with 4 umbrella brands Essenza Di Wills Fiama Di Wills Vivel Superia Recently launched Engage brand in the fast growing deodorants segment well received Laboratoire Naturel A state-of-the-art consumer and product interaction centre leveraged to launch unique and differentiated products Products continue to receive encouraging consumer response

32

Hotels & Tourism

33

ITC Hotels

No. 2 in Size No. 1 in Profitability Margin

34

Hotels & Tourism industry

Foreign arrivals into India: ~6.6 million Vs. ~57.7 million in China The two nations were on par 2 decades ago Today, Beijing alone has as many hotel rooms as the whole of India Indias luxury rooms availability lower than even smaller East Asian countries Huge potential driven by Indias diversity and economic growth

80000 70000 60000 50000 40000 30000 20000 10000 0 Hong Kong Bangkok Singapore Malaysia India

Source: Compendium of Tourism statistics, WTO

35

Indian Hotel Industry

Current supply ~183,000 rooms of which 5 Star category represents nearly 28% of total inventory India needs an additional 50,000 rooms in the next 3/5 years to service projected tourist arrivals Present high levels of room inventory in key Indian cities leading to a relatively weak pricing scenario to persist over the short term As infrastructure for trade & commerce improves - potential for leisure tourism to grow

36

ITC Hotels
Over 95 properties across 66 locations
4 Brands ITC Hotels, WelcomHotel, Fortune & WelcomHeritage

16 Five-Star Deluxe/ Five-Star Properties with over 4200 rooms 41 Fortune Hotels with over 3300 rooms 40 WelcomHeritage Properties with nearly 1000 rooms

Exclusive tie-up with Starwoods Luxury Collection for 10 hotels. ITC Hotels rated as greenest luxury hotel chain in the world

ITC Grand Chola - First 5 Star 'Green Rating for Integrated Habitat Assessment' (GRIHA) rated luxury hotel by the Ministry of New and Renewable Energy

Projects underway at Bengaluru, Kolkata, Classic Golf Resort (near Gurgaon) and Hyderabad.
37

ITC Hotels: Worlds Greenest Luxury Hotel Chain

All ITC Luxury Hotels LEED Platinum certified

Responsible Luxury ethos weaved into the Brand Identity

Paperboards, Paper & Packaging

39

Paperboards & Packaging Business

No. 1 in Size No. 1 in Profitability No. 1 in Environmental Performance

40

Indian Paperboard market

Annual paperboard demand appx. 2.9 million tonnes Low per capita usage of paper at around 9 kgs p.a. (world average over 55 kgs p.a.) Indian paperboard market growing at 7.5% p.a. Value-added Coated board - the fastest growing segment (12% p.a.) in India driven by the growing sophistication of the consumer

41

ITCs Paperboards, Paper & Packaging businesses

Market leader in growth segment value-added coated boards World-class contemporary technology
Ozone bleached Pulp Mill fully operational one of its kind in Asia meeting world-class environmental standards Fully integrated with in-house pulping capacity at ~3 lakh MT

Internationally competitive quality and cost Social farm forestry in mill command area to improve access to cost effective fibre & to attain self-sufficiency
Biotech research based high yielding clones effectiveness tested in approx. 165000 hectares Newly commissioned 1 lakh MT per annum Paperboard machine running well

ITCs packaging SBU - Indias largest converter of Paperboard into high quality printed packaging
Provides superior packaging solutions to the cigarettes and new FMCG businesses Leading supplier to Indian FMCG industry Fully integrated packaging unit at Haridwar operationalised in Mar-13
42

Agri Businesses - Leaf Tobacco - Agri Commodities

43

Agri Business

No. 1 in Leaf Tobacco No. 2 in Agri commodities Pioneer in rural transformation

44

Indian Leaf Tobacco industry

India the second largest producer of tobacco However, Indias share is only at 8% of world tobacco trade Upgradation of tobacco consumption from other formats to cigarettes will enable: growing domestic base & larger opportunities for value-added exports ITC Indias largest buyer, processor, consumer & exporter of cigarette tobaccos 5th largest leaf tobacco exporter in the world Pioneering cultivation of flavourful Flue-cured, superior Burley and Oriental tobaccos in India Robust growth in exports in recent years with improvement in realizations
45

ITCs Agri Commodity Business

Distinctive sourcing capability for ITCs Foods businesses Farm linkages in 17 States covering Wheat, Soya, Potato, Coffee etc. Unique Customer Relationship Management programme for commodity customers in both domestic and international markets Leveraging Information Technology for the transformational e-Choupal initiative

Rural Indias largest Internet-based intervention Over 40000 villages linked through around 6100 e-Choupals servicing over 4 million farmers

e-choupal: Strategic Thrust

Procurement: cost & quality optimisation
strategic sourcing support to the Foods business (support creation of verticals in wheat, potato etc.) cost-effective sourcing for exports/domestic external business

Rural retail
24 Choupal Saagars operational
46

ITC: An Exemplar In Triple Bottom Line Performance ECONOMIC SOCIAL ENVIRONMENT

47

ECONOMIC PERFORMANCE

48

Performance Trends
45000 40000 35000

CAGR 5 Yrs : 14.5% 3 Yrs : 16.9%

Gross Revenue

GOLY
2 5 . 0%

12000

19.9%
2 0 . 0%

CAGR 5 Yrs : 18.5% 3 Yrs : 21.1% 24.7%

PBT
22.4% 20.8%

GOLY
3 0. 0 %

2 5. 0 %

10000

16.5% 13.6% 14.2%

1 5 . 0%

20.1%
2 0. 0 %

8000
1 5. 0 %

30000 25000 20000

8.4%

6000
1 0 . 0% 1 0. 0 %

5.6%
4000
5 . 0% 5. 0 %

08-09 09

09-10 10

10-11 11

11-12 12

08-09
CAGR 5 Yrs : 18.9% 3 Yrs : 22.2%

09-10

10-11

11-12

12-13

PAT
24.4% 22.8% 23.6%

GOLY
30 . 0 %

7500

50.0%
25 . 0 %

ROCE
45.4% 45.7% 43.5% 40.6%

20.4%
20 . 0 %

45.0% 40.0%

5000

15 . 0 %

10 . 0 %

35.0% 30.0%

32.8%

4.6%
2500

5 . 0 %

08-09

09-10

10-11

11-12

12-13 13

0 . 0 %

08-09

09-10

10-11

11-12

12-13

12-13

ITCs Economic Contribution to the Nation

10 year Value addition ~ Rs. 1.6 lakh crore (US$ 35 billion)

~75% of value addition accrued to the Exchequer
Among the top tax payers in the nation (Private sector) Excise payments represent ~ 7% of Indias total Excise collection

Foreign exchange earnings in the last 10 years: USD 5 bln

Of which agri exports constituted ~60%

50

ITC - Key Financials Q3 2013/14

` crs
Q3 13/14 Gross Revenue Net Revenue PBDIT PBIT PBT PAT 12223 8623 3675 3449 3440 2385 Q3 12/13 10825 7627 3188 2982 2957 2052 Goly % 12.9 13.1 15.3 15.7 16.3 16.3

51

Q3 2013/14: Segment Revenues

` crs

Q2 2013-14 Segment Revenue (Net) 3724 1962 5686 247 1772 1179 8884 1108 7776 a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less : Inter segment revenue Net sales / income from operations

Q3 2013-14 2012-13

GOLY(%)

4116 2078 6194 315 1786 1257 9553 930 8623

3657 1783 5440 309 1631 1062 8442 815 7627

12.5 16.6 13.9 1.9 9.5 18.5 13.2 14.1 13.1

52

Q3 2013/14: Segment Results

` crs

Q2 2013-14 2570 (13) 2557 9 285 221 3071 (33) (130) 3234

Q3 a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less: i) Finance Costs ii) Other Unallocable Exp. / (Inc.) - Net Profit Before Tax 2013-14 2653 10 2663 62 205 232 3162 9 (287) 3440 2012-13 2234 (24) 2210 55 173 229 2666 25 (316) 2957

GOLY(%)

18.8 20.5 12.1 19.0 1.4 18.6 (63.7) (9.1) 16.3

53

YTD Dec13: Segment Revenues

` crs

YTD Dec 13 2013-14 2012-13 Segment Revenue (Net) a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less : Inter segment revenue Net sales / income from operations 11377 5785 17162 812 5748 3599 27321 3584 23737 10347 4947 15293 759 5346 3179 24578 3152 21425

GOLY(%)

10.0 16.9 12.2 7.1 7.5 13.2 11.2 13.7 10.8

54

YTD Dec13: Segment Results

` crs

YTD Dec 13 2013-14 2012-13 Segment Results a) FMCG - Cigarettes - Liab. no longer reqd. written back FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less: i) Finance Costs Liab. no longer reqd. written back Finance Costs ii) Other Unallocable Exp. / (Inc.) - Net Profit Before Tax 7306 158 7464 (21) 7443 80 689 704 8916 28 (35) (7) (514) 9436 6214 0 6214 (93) 6120 97 604 776 7597 62 0 62 (420) 7955

GOLY(%)

17.6 20.1 77.2 21.6 (17.7) 14.2 (9.2) 17.4 (54.7) NA 22.3 18.6

55

YTD Dec13: Segment Capital Employed

` crs

YTD Dec 13 2013-14 2012-13 Capital Employed a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Segment Capital Employed 5218 3167 8386 3576 1793 5184 18939 4525 2358 6883 3416 1476 4719 16494

GOLY(%)

15.3 34.3 21.8 4.7 21.5 9.9 14.8

56

ITC - Key Financials 2012/13

` crs

FY 12/13 Actuals 41810 29606 11566 10771 10684 7418

FY 11/12 Actuals 34872 24798 9674 8975 8898 6162

Goly % 19.9 19.4 19.6 20.0 20.1 20.4

Gross Revenue Net Revenue PBDIT PBIT PBT PAT

57

2012/13: Segment Revenues

` crores

FY 13 Segment Revenue (Net) a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less : Inter segment revenue Net sales / income from operations 13970 6983 20953 1074 7201 4237 33464 3859 29606

FY 12 12324 5526 17850 1006 5695 3923 28475 3676 24798

Goly% 13.4 26.4 17.4 6.8 26.4 8.0 17.5 5.0 19.4

58

2012/13: Segment Results

` crores

FY 13 Segment Results a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less: i) Interest (Incl other Finance Cost) ii) Other net un-allocable expenditure/ income Profit Before Tax 8326 (81) 8245 138 731 964 10078 86 (693) 10684

FY 12 6908 (195) 6712 279 643 937 8571 78 (404) 8898

Goly% 20.5 58.4 22.8 (50.7) 13.7 2.9 17.6 11.0 71.6 20.1

59

2012/13: Segment Capital Employed

` crores

FY 13 Capital Employed a) FMCG - Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Segment Capital Employed 4953 2532 7485 3460 1257 4958 17160

FY 12 3599 1989 5588 3238 1702 4354 14881

Goly% 37.6 27.3 33.9 6.9 (26.2) 13.9 15.3

60

SOCIAL PERFORMANCE

61

Social Impact
Direct employment ITC Group : 30,000 Indirect employment across the value chain : 5 million e-choupal: worlds largest rural digital infrastructure serving over 4 million farmers Social and Farm forestry initiative has greened nearly 165,000 hectares & provided approx. 64 million person-days of employment among tribals & marginal farmers Significant thrust on social sector investments
Natural resource management Sustainable livelihoods Community development programmes in the economic vicinity of operating locations
62

ENVIRONMENTAL PERFORMANCE

63

Environmental Impact
Carbon positive enterprise 8th year in a row
Sequestering/storing more than the amount of CO2 that the company emits

Water positive - 11th year in a row

Creating over twice rainwater harvesting potential than ITCs net consumption

Solid waste recycling positive 6th year in a row Over 40% of total energy consumed is from renewable sources

Only Company in the world to achieve all 3 key indices of environmental sustainability

64

Forward-looking Statements
Statements in this presentation describing the Companys objectives, future prospects, estimates, expectations etc. may be forward looking statements within the meaning of applicable securities laws and regulations. Investors are cautioned that forward looking statements are based on certain assumptions of future events over which the Company exercises no control. Therefore there can be no guarantee as to their accuracy. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those that may be projected or implied by these forward looking statements. Such risks and uncertainties include, but are not limited to: growth, competition, acquisitions, domestic and international economic conditions affecting demand, supply and price conditions in the various businesses in the Companys portfolio, changes in Government regulations, tax regimes and other statutes, and the ability to attract and retain high quality human resource.

65