One of India‟s Most Admired Companies
Performance Track Record - Snapshot
Rs Crs Gross Turnover Net Turnover Market Capitalisation PBDIT PBIT PBT PAT (After Exceptional Items) EPS Rs (Equalised for 95-96) Net Worth Capital Employed ROCE% Total Shareholders Returns %
Rs. 1 crore= Rs. 10 million
95-96 5115 2536 5571 584 536 452 261 0.7 1121 1886 28.4
09-10 26,260 18,153 100,475 6,677 6,069 6,015 4,061 10.73 14,064 14,957 40.6
Cagr 95-96 to 09-10 12.4% 15.1% 22.9% 19.0% 18.9% 20.3% 21.7% 21.4% 19.8% 15.9% 24.3%
ITC - Key Financials – 2009/10
Rs crs Gross Turnover External Net Turnover External PBDIT PBIT PBT PAT
09/10 Actuals 26260 18153 6677 6069 6015 4061
08/09 Actuals 23144 15612 5393 4844 4826 3264
Goly % 13.5 16.3 23.8 25.3 24.7 24.4
2009/10: Segment Revenues
2009-10 1. Segment Revenue (Gross) a) FMCG - Cigarettes - Others Total FMCG 17,283 3,642 20,925 911 3,862 3,234 28,931 2,672 26,260 2009-10 9,321 3,634 12,955 851 3,862 3,108 20,776 2,622 18,153 15,115 3,014 18,129 1,020 3,846 2,822 25,817 2,674 23,144 2008-09 7,781 3,006 10,786 935 3,846 2,647 18,215 2,603 15,612 14.3 20.8 15.4 (10.7) 0.4 14.6 12.1 (0.1) 13.5 Goly 19.8 20.9 20.1 (9.1) 0.4 17.4 14.1 0.8 16.3 Full Year 2008-09 Goly
b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Less : Inter segment revenue Gross sales / income from operns. 2. 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 operns.
3 34.7 24. Segment Results a) FMCG .015 Full Year 2008-09 4.938 (350) 4.Others Total FMCG b) Hotels c) Agri Business d) Paperboards.926 53 (143) 6.Cigarettes .0 27.184 (483) 3.9 191.2009/10: Segment Results
2009-10 3.826 Goly 18.589 217 436 684 5.700 316 256 509 4.0 (31.6 24.7
.2 127.5) 70. Paper & Packaging Total Less : i) Interest (Net) ii) Other net un-allocable expenditure/ income Total PBT 4.5 23.781 18 (63) 4.
9 27.Key Financials – Q4 09/10
Q4 09/10 Actuals Gross Turnover External Net Turnover External PBDIT PBIT PBT PAT 7159 5054 1677 1523 1505 1028
Q4 08/09 Actuals 5871 3950 1351 1205 1192 809
Goly % 21.4 26.9 24.3 27.2 26.1
5 28.Cigarettes .123 3. Paper & Packaging Total Less : Inter segment revenue Gross sales / income from operns.Others Total FMCG
b) Hotels c) Agri Business d) Paperboards.Others Total FMCG 4. Paper & Packaging Total Less : Inter segment revenue Net sales / income from operns.159 2009-10 2.0 15.9 22.9 12.6 87.623 569 5.070 837 2. Segment Revenue (Gross) a) FMCG .7 36.453 1.871 2008-09 2.8 21.8 13.125 5.054 3.5 27.9 Q4 2008-09 Goly
b) Hotels c) Agri Business d) Paperboards.8 34.302 432 5. 2.367 417 3. Segment Revenue (Net) a) FMCG .Q4 2009/10: Segment Revenues
2009-10 1.2 23.576 256 988 803 5.740 582 7.9 87.9 Goly 18.4 34.949 839 4.950 14.1 17.Cigarettes .788 241 526 747 6.517 1.9 11.907 221 526 714 4.5 34.
.642 274 988 836 7.
6 10.Q4 2009/10: Segment Results
2009-10 3.7 32.1 19.Cigarettes .081 (117) 964 71 53 152 1.192 Goly 15. Segment Results a) FMCG .2 35.Others Total FMCG b) Hotels c) Agri Business d) Paperboards.173 78 58 169 1.478 19 (45) 1.3 NA 26.3
• FMCG Others – positive swing of Rs 38 crs
.9 11.505 Q4 2008-09 1.0 9. Paper & Packaging Total Less : i) Interest (Net) ii) Other net un-allocable expenditure/ income Total PBT 1.9 21.240 14 35 1.251 (79) 1.
580 3.719 4.8
.Others Total FMCG b) Hotels c) Agri Business d) Paperboards.457 1. 2.771 12.1 (1.717 2.1 (18. Paper & Packaging Total Segment Capital Employed * Local Tax Provision not incl.035 542.2) (6.Segment Capital Employed
Full Year 2008-09 2.Cigarettes * .998 1.039 3.037 2.101 5.6) 3.6 15.3 52.711 12.86
2009-10 4. Capital Employed a) FMCG .189 1.4) 12.465 628.64
Goly 2.936 2.
assets & market value
One of the foremost in the private sector in terms of :
Sustained value creation (BT-Stern Stewart survey) Operating profits
Ranks No. > USD 5 bln.One of India‟s most valuable and admired companies
One of the 8 Indian Companies to feature in „Forbes A-list‟ for 2004
Featuring 400 of the World‟s „best big companies‟ with M-cap. & are
rated as the „most attractive companies for investors‟
Only Indian FMCG Company to feature in Forbes 2000 List
A comprehensive ranking of world‟s biggest companies measured by a composite of
sales. 5 among Indian listed Private Sector Companies by market cap. 1 in FMCG Sector Rated as one of India‟s Most Respected Companies (IMRB-Businessworld Survey 2006)
. • No. profits.
The Best Corporate Social Responsibility Practice Award 2008 jointly instituted by the Bombay Stock Exchange. social and natural capital for the nation. ITC ranked second among top Indian companies. Ryutaro Hashimoto Incentive Prize 2007 for Environment & Development from the Asia Pacific Forum • • •
• • •
In the first of its kind S&P Environmental.
The Company has won the Corporate Social Responsibility Crown Award for Water Practices from UNESCO and Water Digest for its distinguished work carried out in the water sector in India. Social and Corporate Governance (ESG) ratings released recently.Awards & Accolades (1)
• „ITC received the FICCI Outstanding Vision Corporate Triple Impact Award 2007 for invaluable contribution to the triple bottom line benchmarks of building economic.
. Times Foundation and the NASSCOM Foundation. Sustainability Leadership Award 2007 conferred on Chairman Y C Deveshwar by the Sustainability Forum. adjudged as a commendable entry under the “Manufacturing and Trading Enterprises” category. ITC has been conferred the ICAI Award for Excellence in Financial Reporting with its Annual Report and Accounts. has been conferred on ITC in recognition of its outstanding initiatives in the consumer products segment. Zurich and SAM/SPG at the International Sustainability Leadership Symposium Business Today Award for the Best Managed Company – Retail and Consumer Products. ITC Limited won the top UNIDO award at the International Conference on Sharing Innovative Agribusiness Solutions 2008 at Cairo in recognition for its initiatives in agri business.
Accolades & Awards (2)
• e-Choupal initiative wins global recognition:
– 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 to win the Development Gateway Award 2005 for the most exemplary contribution in the field of Information & Communication Technologies (ICT) for development during the last 10 years – World Business Award 2004: International Chamber of Commerce & the HRH Prince of Wales & International Business forum – Harvard University case study – Recognised in World Development Report 2008 published by World Bank – Applauded by President of India Dr APJ Kalam in his “special address during the national symposium to commemorate 60th year of independence”
Education & Stationery
Paper & Packaging
.ITC Business Portfolio
Cigarettes Foods Personal Care Lifestyle Retailing
Strategy of Organisation to manage diversity of Portfolio
Formal 3-tiered governance structure:
Board of Directors :
Comprising executive (4) and non-executive directors (11) Strategic supervision
Corporate Management Committee : Comprising executive directors and senior managers Strategic management Divisional Chief Executive & Divisional Management Committee : Executive management
matching internal capabilities with emerging market opportunities Pursue World class competitiveness in all businesses and across the entire value chain Best-in-class in terms of: • Internal Vitality • Market Standing • Profitability Strategy of Organisation and Governance processes geared to manage multiple businesses Blend core competencies and leverage ITC umbrella strengths to create new avenues of growth
Sustain multiple drivers of growth.
00.ITC‟s Cigarettes Business
Market leadership Powerful brands across segments Leadership in all segments .10 billion in six years
Exciting long term growth potential
.geographic & price Extensive FMCG distribution network
Direct servicing of 1.Rs.000 markets & 2 million retail outlets
World-class state-of-the-art technology and products Investment .
15% can afford cigarettes
Biri : Cigarettes ratio = 10 : 1 Annual per capita adult cigarette consumption in India is appx. one
tenth world average : 85
Future growth depends on relative rates of growth of per capita income and moderation in taxes
.Cigarettes: Growth potential
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 nearly 85% of
Revenue to the Exchequer from tobacco sector Of the 58% of adult Indian males who consume tobacco.
Tob Board & Industry Estimates – gms/Yr
Per Capita consumption is ~ 60% of World Average
.Per Capita Consumption of Tobacco in India
(gms per year)
743 438 461 468
Source:World Cigarettes – ERC Statistics.
Per Capita Cigarette Consumption
No Of Cigarettes
1000 618 500 488 303 243 85
Bangladesh Japan Pakistan China
Nepal Sri Lanka
Per Capita consumption in India ~ 10% of World average
Rajasthan & Pondicherrythreatening the concept of the „Indian Common Market‟
Cost table increasing with increase in leaf costs
.e. Alongwith smuggled
contraband. • VAT hikes in Maharashtra.f. Delhi.Cigarettes: Challenges
• Competition including international majors becoming more active
• Domestic illegal volumes still very strong. June 09. has emerged as substantive segment
Regulatory & Taxation
• Pictorial Graphic warnings in place w.
Hotels & Tourism
Vs. 35 million in China • The two nations were on par 2 decades ago at 750. WTO
. Beijing alone has as many hotel rooms as the whole of India India‟s luxury rooms availability lower than even smaller East Asian
80000 70000 60000 50000 40000 30000 20000 10000 0
HongKong Bangkok Singapore Malaysia India
Source: Compendium of Tourism statistics.000 arrivals Today.Hotels & Tourism industry
Foreign arrivals into India: 5 million appx.
000 rooms in the next 2/3 years to service projected tourist arrivals
Present mismatch between supply and demand expected to
persist over the short term As infrastructure for trade & commerce improves . 30%
India needs an additional 50.000 rooms of which 5 Star category
accounts for appx. 110.growing
potential for leisure tourism
.Indian Hotel Industry
Current supply – appx.
„Luxury Collection‟ / „Sheraton‟
.ITC‟s Hotel Business
ITC-Welcomgroup : a leading hotel chain in India • Established presence in key business locations • Over 6000 rooms under 4 distinct brands
Luxury Upper upscale Upscale .mid-scale Heritage
ITC Hotel: Luxury Collection WelcomHotel: Sheraton Fortune Hotels WelcomHeritage
"Mansions of Luxury" "Passion for Quality" "Promise of True Value" "Unique Experiences"
Bangalore 292 room luxury hotel launched in October „09
Capacity expansion underway at Chennai & Kolkata. Fastest growing hotel chain with highest operating efficiency (PBDIT/Net Income @ 40%) amongst the 3 leading chains Leverages unique service proposition and international alliance with Starwood Hotels & Resorts . plans for other locations also
ITC‟s Hotel Business
• Manages 34 full service mid-market properties (2000 + rooms ) under the Fortune Hotels brand – 21 more hotels in pipeline. • Also operates 60 properties under the „WelcomHeritage‟ brand in 19 states . – 100% subsidiary company : Fortune Park Hotels Ltd.
. 50% JV with
Marudhar Hotels (P) Ltd.4800 appx.Maharaja Heritage Resorts Ltd. room inventory.
Paperboards. Paper & Packaging
a. (world average – over 55 kgs p.Indian paperboard market
Annual paperboard demand – appx. 2 million tonnes
Fragmented capacity & obsolete technology
Low per capita usage at around 7 kgs p.a.)
Indian paperboard market growing at 7% p.
Value Added Coated board .the fastest growing segment (15% p.a.) in India driven by the growing sophistication of the consumer
00.ITC‟s Paperboards Business
Market leader in growth segment . 2.value added coated boards
World-class contemporary technology • Ozone bleached Pulp Mill fully operational – only one of its kind in Asia meeting world-class environmental standards 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 > 1.000 hectares
Fully integrated operations with in-house pulping capacity at appx.20 lac MT
000 TPA paperboards machine underway
ITC‟s packaging SBU -India‟s largest converter of paperboard into high quality printed packaging
• Leading supplier to Indian FMCG and Consumer Electronic segments
• Provides superior packaging solutions to the cigarettes and new FMCG businesses
.ITC‟s Paperboards & Packaging businesses
Capacity expansion projects installed – at optimum capacity utilization • 120000 TPA Pulp Mill – Machine stabilised • 100000 TPA paper machine (to support Stationery business growth plans) Machine stabilized
• Investment in 100.
Agri Businesses .Agri Commodities
.Leaf Tobacco .
Indian Leaf Tobacco industry
India – the third largest producer of tobacco However.robust growth in export volumes with improvement in realization over the last 2 years
. India‟s share is only 7% in world tobacco trade
Upgradation of tobacco consumption from other formats to cigarettes
will enable: • growing domestic base & larger opportunities for value added exports ITC – India‟s largest buyer. consumer & exporter of cigarette tobaccos 6th largest leaf tobacco exporter in the world Pioneering cultivation of flavourful Flue-cured. superior Burley and Oriental tobaccos in India Export business . processor.
ITC‟s Agri Commodity Business
Farm linkages in 14 states covering Soya. Wheat.5 million farmers
Distinctive sourcing capability for ITC‟s Foods business
. Marine products. Coffee etc. Focus on value added agri commodities
Unique CRM programme in commodity exports Leveraging initiative
Rural India‟s largest Internet-based intervention
Over 40000 villages linked through around 6500 e-Choupals servicing over 3.
) • cost-effective sourcing for exports/domestic external business Rural Distribution • „last mile connectivity‟: 100 partnering companies • diverse range of goods/services: FMCG. paid extension services etc. consumer durables. corn. soya. potato etc. agri-inputs. Financial Services • insurance (focus: weather) • credit (focus: Kisan credit card scheme) Rural retail
• 24 Choupal Saagars operational
.e-choupal: Strategic Thrust
Procurement: cost & quality optimisation • strategic sourcing support to the Foods business (support creation of verticals in wheat.
Future Growth & Value Capture
New FMCG Initiatives
Blend multiple competencies residing within the ITC Group to create new avenues of growth Best fit between internal capabilities and emerging market opportunities Each segment enhances the depth and width of ITC‟s FMCG distribution capability Business model retains critical elements of value chains within ITC with other elements outsourced • Contributing to the competitiveness of SMEs
Aashirvaad (Instant Mixes & Cooking Pastes). Bridge products : Bingo! • Confectionery – Candyman. Sunfeast Pasta
. Mint-o • Ready to Eat – Kitchens of India (Ready to Eat. Salt. Spices • Biscuits – Sunfeast • Salty Snacks – Potato chips. Conserves & Chutneys and Frozen Foods).Branded Packaged Foods
Leverages: • Unique Agri sourcing skills • ITC Welcomgroup‟s specialist cuisine & bakery knowledge • FMCG distribution synergies • ITC R&D Centre. Bangalore 5 chosen categories: • Staples – Aashirvaad Atta.
distributed & outsourced supply chain being ramped up – Targeted cost management actions shore up margins • Number of innovative products in the pipeline leveraging the capabilities of the ITC R&D Centre
. leverages the echoupal network for cost-quality optimisation and region specific offerings
• Sunfeast Biscuits:
– Differentiated & innovative products.Branded Packaged Foods
• Aashirvaad Atta: – Current market leader amongst national branded players. continues to build consumer franchise.
a Upmarket product range available in exclusive Wills Lifestyle stores (56) and multi-branded outlets/ large format retail stores across the country • Premium segment comprising the „Classic‟ range of formal wear.Lifestyle Retailing
Leverages trade mark and services expertise of hotels Relaxed wear market growth > 20% p. „Wills Sport‟ relaxed wear and „Wills Clublife‟ evening wear • Designer association with leading Indian designers – „Wills Signature‟ line • Strong distribution network in place for the mid-market brand „John Players‟
• availability in 225 Exclusive Branded outlets. 200 multi branded outlets and
departmental stores • Wills Lifestyle rated amongst the top 5 Luxury brands in the country (Global
Luxury Survey conducted by TIME Magazine)
Comprehensive portfolio approach with new variant/category launches
. Forward linkages with new paper
capacity (already commissioned). Offers opportunity for branding
Robust distribution network in place to scale up the Stationery business significantly
• „Classmate’ brand already the most widely distributed brand in India.growth driven by increasing cross-cultural exposure.Education & Stationery Products Business
Leverages print and paper know-how. Scholastic
products launched • Branded Copier Paper „Paperkraft‟ footprint being enhanced. spending on education
• Mostly commoditized. govt.
An emerging (currently Rs 9000 cr stationery) market in India . Enthusiastic customer response based on green credentials.
a. 1250 crores p. Ship. ITC markets its brands with value added products across each price point • Support SMEs with complementary marketing strengths „AIM‟ – India‟s largest selling Safety Matches brand Successful acquisition of WIMCO Ltd.50 p price point to Re 1.Safety Matches
Current industry consumer spend estimated at Rs. Cheetah Fight etc. for 24 billion match boxes Fragmented supply base arising from policy of reservation for small scale industry Mass market moving from 0.00.
. by Russell Credit • Key brands: Homelites.
a. 900 crores p.Incense sticks (Agarbattis)
Current industry consumer spend estimated at over Rs.
Fragmented supply base arising from policy of reservation for small scale industry ITC markets its brands with value added products across each price point • „Mangaldeep‟ : second largest national brand in the country • Support cottage sector with complementary marketing strengths • Provides livelihood opportunities to more than 8000 under privileged women
gaining customer acceptance Supported by investments in brands – celebrity endorsements Investments being made in Research & Development and strategic tax
incentivised manufacturing sites
.Personal Care Products
Current market size estimated at over Rs. conditioner) category
Portfolio approach straddling all consumer segments with 4 umbrella brands
• • •
Essenza Di Wills (Prestige)
Fiama Di Wills (Premium) Vivel Di Wills and Vivel (Mid) Superia (Popular)
Products well received in the market. shower gels) and Hair Care
ITC presence established in Body Wash (Soaps. 29000 crores (growing at 12% p.
supply and price conditions in the variouS buSineSSeS in the company’S portfolio. domestic and international economic conditions affecting demand. 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. and the ability to attract and retain high quality human resource.Forward-looking Statements
StatementS in thiS preSentation deScribing the company’S objectives. estimates. acquisitions. competition. changeS in Government regulations. tax regimes and other statutes. expectations etc. but are not limited to: growth. Such risks and uncertainties include. may be “forward looking StatementS” within the meaning of applicable securities laws and regulations. future prospects. 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.