A Report on ITC AASHIRVAAD

DEMAND FORECAST: ITC AASHIRVAAD AATA

TABLE OF CONTENTS

TOPIC PAGE NUMBER

CHAPTER 1: INTRODUCTION 3

CHAPTER 2 : SWOT ANALYSIS 8

CHAPTER 3 :INDUSTRY ANALYSIS 10

CHAPTER 4: SRATEGIC SALES 15

PLANNING PROGRAM
CHAPTER 5: RESEARCH 16
METHODOLOGY
CHAPTER 6 : DATA ANALYSIS AND 17
INTERPRETATIONS

CHAPTER 7: FINDINGS 22

CHAPTER 8: CONCLUSION and 23

RECOMMENDATIONS
CHAPTER 9: REFERENCES 24

CHAPTER 1: INTRODUCTION

1.1 Company profile

 ITC Limited is an Indian multinational conglomerate company headquartered in Kolkata,
West Bengal. Established in 1910 as the 'Imperial Tobacco Company of India Limited', the
company was renamed as the 'India Tobacco Company Limited' in 1970 and later to 'I.T.C.
Limited' in 1974. The dots in the name were removed in September 2001 for the company
to be renamed as 'ITC Limited' where 'ITC' would no longer be an initialism. The company
completed 100 years in 2010 and as of 2012–13, had an annual turnover of US$8.31 billion
and a market capitalisation of US$52 billion. It employs over 30,000 people at more than
60 locations across India and is part of Forbes 2000 list.

Founded 24 August 1910; 109 years ago

Headquarters Virginia House, Kolkata,

West Bengal, India

Area served
 Indian Subcontinent

 Gulf Countries

Key people
Sanjiv Puri
(Chairman & MD)

Revenue 52,035 crore (US$7.5 billion) (2019)

Number of employees 27,279 (2019)

1.2 Products & Brands

1. Cigarettes
ITC Ltd sells 81% of the Cigarettes, Bidi in Asia, where 275 million people use tobacco
products and the total cigarette market is worth close to $11 billion (around Rs. 757399
million).ITC's major cigarette brands include Wills Navy Cut, Gold Flake Kings, Gold
Flake Premium lights, Gold Flake Super Star, Insignia, India Kings, Classic (Verve,
Menthol, Menthol Rush, Regular, Citric Twist, Ice Burst, Mild & Ultra Mild), 555, Silk
Cut, Scissors, Capstan, Berkeley, Bristol, Lucky Strike, Players, Flake and Duke & Royal.

2. Other businesses

 Foods: ITC's major food brands include Kitchens of India; Aashirvaad, B natural,
Sunfeast, Candyman, Bingo! And Yippee!. ITC is India's largest seller of branded
foods with of over Rs. 4,600 crore in 2012-13. It is present across 6 categories in
the food business including snack foods, ready-to-eat meals, fruit juices, dairy
products and confectionery.

 Personal care products include perfumes, haircare and skincare categories. Major
brands are Fiama Di Wills, Vivel, Savlon Soap & Handwash, Essenza Di Wills,
Superia and Engage.

 Stationery: Brands include Classmate, PaperKraft and Colour Crew. Launched in

2003, Classmate went on to become India's largest notebook brand in 2007.

 Safety Matches and Agarbattis: Ship, i Kno and Aim brands of safety matches and
the Mangaldeep brand of agarbattis (Incense Sticks).

 Hotels: ITC's Hotels division (under brands including WelcomHotel) is India's

second-largest hotel chain with over 90 hotels throughout India. ITC is also the
exclusive franchise in India of two brands owned by Sheraton International Inc.
Brands in the hospitality sector owned and operated by its subsidiaries include
Fortune Park Hotels and Welcome Heritage Hotels.

 Paperboard: Products such as specialty paper, graphic and other paper are sold
under the ITC brand by the ITC Paperboards and Specialty Papers Division like
Classmate product of ITC, well known for their quality.
  Packaging and Printing: ITC's Packaging and Printing division operates
manufacturing facilities at Haridwar and Chennai and services domestic and export
markets.

 Information Technology: ITC operates through its fully owned subsidiary ITC
Infotech India Limited.

1.3 Aashirvaad Brand’s Journey

 May 2002

ITC made its entry in the branded Atta segment and within a short period of time
became the number one branded packaged atta across the
country. AASHIRVAAD promises you only the most delightful rotis straight from
your kitchen complete with your love and care through your preparation. They use
their network of 6500 Choupals to buy wheat straight from our farmers across the
most fertile fields. This is followed by the rigorous process of cleaning, mechanized
packing and nutrition lockage.

 April 2003

AASHIRVAAD then entered the branded salt market with AASHIRVAAD Salt
and ensured that only the most hygienic iodized salt reached the kitchens of the
Indian household.

 March 2005

AASHIRVAAD Select, a premium quality atta made from the King of Wheat was
launched. It is 100% MP Sharbati wheat which is harvested exclusively in 7
districts of Madhya Pradesh including the the Sehore region.

 May 2005
 ITC forayed into the branded spices market with the launch of AASHIRVAAD
Spices in May 2005. The offering currently consists of Chilli, Turmeric and
Coriander powder in SKUs of 50g, 100g, 200g and 500g each AASHIRVAAD
Spices, operating in selected markets of south, east and north, have spread to a large
consumer base and have emerged as a major player in basic spices in most regional
markets. The spices are sourced directly from the farmers and selected by experts
to ensure the right aroma, pungency and colour.

 March 2006

With a range of 4 dishes, AASHIRVAAD introduced its Instant Mix products.

Whether it was having breakfast with Rava Idlis or finishing your dinner with some
soft Gulab Jamuns, they have covered it all.

 October 2015

In 2015, ITC forayed into Dairy category and AASHIRVAAD Svasti Ghee, its first
product from the Dairy portfolio was the result of extensive Research and ITC’s
very own, state-of- the-art manufacturing facility in Munger (Bihar).
Today it has become a common name in house-holds and if one of the fast growing
brands for the company. Its manufactured using a special ‘SloCook’ process which
enhances its natural aroma, giving it a distinct flavor that lends beautifully to varied
Indian cuisines.

 May 2019

AASHIRVAAD Nature's Superfoods have been specifically made from ancient

grains such as Jowar, Ragi, Quinoa, etc which are known for their numerous health
benefits. It is naturally gluten free, rich in dietary fibre and a source of protein.
 CHAPTER 2 : SWOT ANALYSIS

 Strengths
ITC has been able to established itself as the market leader in the packaged food market. Within 8
years after launching Aashirvaad Atta, it has become number one in branded packaged Atta sector
across the country with a whopping market share of 55%.
The focus of ITC has always been on the providing its customers with best the possible quality
and in the case of Aashirvaad Atta also, they have emphasised on the quality and freshness. To
keep the taste of packaged Atta authentic with respect to Chakki Atta, ITC follows traditional
methods to produce it. It obtains the finest wheat grains directly from the farmers and then the
grains are grounded using modern 'Chakki - grinding' process to produce genuine and authentic
Atta. ITC also tries to ensure that Aashirvaad Atta contains 100% Atta and no Maida. In addition,
the quality is maintained such that the dough made from Aashirvaad Atta absorbs more water
making the Rotis softer.
ITC has been able to successfully use its E-choupals initiatives to obtain the finest wheat grains
for the production of Atta directly from farmers. This backward integration gives them two distinct
advantages. The first being reduction in the cost of wheat by around 2 percent as no middlemen is
involved in the process. The second advantage is of course quality since ITC does not have to rely
upon the Mandi system where the wheat grain can be of inferior quality. ITC offers a wide range
of Aashirvaad Atta products cater to the different consumers’ demands. Apart from the basic
brands, there are two high-end brands with some special ingredients. ITC has its own packaging
business and it utilizes its packaging business to come out with really superior and innovative
packaging. The material used for packaging the Aashirvaad Atta is “PET Poly” which keeps the
Atta fresh. Further, it also offers carton packaging and vacuum sealing for its premium packs.
Although ITC already had excellent distribution network for its cigarette products, it needed to
develop the new and different distribution infrastructure for its Aashirvaad Atta product. However,
in the last 8 years it had really developed its distribution network and with its strong E-Choupal
network it can competed with its competitors on the distribution front.

 Weaknesses
Aashirvaad Atta can be considered as a premium priced product, as it is very costly when compared
to unpackaged Atta sector. Currently, the focus of ITC is on urban market with respect to packaged
Atta sector and with packaged Atta sector still being less than 3% of the total Atta market; ITC
can be focused on rural market also to capture more of the unpackaged Atta market. ITC has
focused more on the retail shop based promotion strategy. However, to attract more and more
customers, ITC needs to promote it more using TV and other media promotion strategies.

· Opportunities
Food Industry is India’s sleeping giant. With the rise of modern retail formats, increasing
disposable incomes and healthy awareness, the category is undoubtedly evolving. With the
branded Atta market in India being very attractive in terms of size and consumption patterns,
growth has also picked up pace with the Government’s proactive approach with the formulation
of national food policy, reservation of select segments. Apart from North India, which has always
been very high in wheat consumption, ITC can concentrate in rice dominant regions such as
Andhra Pradesh. Atta is used for making puri, which is a popular breakfast item for South Indians.
ITC can collaborate with fast food chains such as McDonalds, Pizza Hut and Subway. This has
been an untapped market until now and tying up with these chains as their main flour suppliers
can open up a new window for ITC.

 Threats
Indian market is largely dominated by innumerable local flour-mills and ‘Chakki Atta’, which are
the biggest threat to Aashirvaad Atta. Chakki Atta is still perceived as the best quality Atta and it
is cheaper as compared to branded packaged Atta. Obvious threat is the domestic competition.
Competitors such as Annapurna and Pillsbury are doing their best to increase their market share.
Until now, the competition is mainly domestic. In future when Western companies will see India
as an exciting opportunity for packaged Atta, then the competition will get intense.

CHAPTER 3 :INDUSTRY ANALYSIS

3.1 Industry Analysis

ITC Ltd has set its sights higher for Aashirvaad—the Kolkata-based cigarette-to-shampoo maker’s
largest packaged food brand.
The company has set an internal target of generating Rs10,000 crore from Aashirvaad annually in
five years.
For perspective, this means that in five years, ITC will generate what the country’s largest pure-
play listed food company, Nestle India Ltd, notched up in calendar year 2017 sales (Rs10,135
crore), and more than the financial year 2017 revenue of biscuit maker Britannia Industries Ltd
(Rs8,684 crore), by selling food products under Aashirvaad— a brand ITC created in May 2002
to sell atta, and later expanded to include spices, salt, ghee, instant mixes and ready-to-eat meals.
“At the retail level, Brand Aashirvaad’s current sales is around Rs 4,200 crore. The brand has been
growing at a compounded annual rate of 16-17% for the past few years.
It has also been used to brand a range of extensions (wheat atta, atta with multigrains, atta with
methi, salt and fortified Atta), spices (pickle mirch powder, chilli powder, coriander powder and
turmeric powder), instant mixes (gulab jamun, ravi idli, rice idli and rice dosa) and ready meals.

Industry executives said ITC’s packaged food business is continuing to drive its FMCG growth
with personal care brands yet to break into the Rs 1,000-crore plus trajectory. This might slow
the pace of growth for the company as the cash-cow packaged food brands have already gained
scale with high base. “ITC needs to create new growth drivers, be it in personal care or an entry
into home care,” the chief of a leading grocery retail chain said.
Aashirvaad atta is the market leader in the atta segment with a market share of 56%.The
major competitors are Shakti Bhog with a market share of 20%, Pillsbury with 8% and
Annapurna.
Shakti Bhog was introduced in 1970.It is now present in around 60 countries including US,
Australia and New Zealand. Annapurna was launched by HUL in 1998.Its atta range includes
farm fresh, multigrain and special. Pillsbury was launched by General Mills in 1998.The
product range include chakki fresh, gold and multi grain. Apart from these major players,
regional players are also a huge competitive threat. They give a tough fight on the price
factor. For modern wholesalers like Walmart’s Best Price and Metro Cash and Carry, margin
in local atta is much higher (Rs15 to Rs20) than that in the branded ones. This is forcing
the company to sell the product below its selling price.

3.2 Financial implication

3.2.1 Profit and Loss Statement for year ended at 31 March
2019
3.2.2 Balance sheet for year ended at 31 March 2019
Financial Ratios-

1. Current Ratio= 1.8

2. Quick Ratio= 1.16
3. Inventory Turnover Ratio= 6.03 times
4. Fixed Assets Turnover Ratio= 2.03
5. Debtors Turnover Ratio= 14.99
 CHAPTER 4
SRATEGIC SALES PLANNING PROGRAM

 ITC uses 6500 e-choupals to buy wheat straight from their farmers to obtain finest
wheat grains for the production of Atta, this is followed by rigorous process of
cleaning, mechanized packing and nutrition lockage. And so they deliver the promise
of the goodness of whole wheat.

 This backward integration gives them two distinct advantages. The first being
reduction in the cost of wheat as no middlemen is involved in the process. The second
advantage is they do not have to compromise on quality like if they opt to purchase it
from mandai it may be of inferior quality.

 ITC has focused more on the retail shop based promotion strategy. As their target
customers generally purchase from the organised retail market.

 Packaging material used for ashirvaad atta is “Pet Poly” which helps retain freshness
in Atta. For Premium category it even gives Carton Packaging and vacuum sealing for
its premium packs.
 CHAPTER 5
RESEARCH METHODOLOGY

Sample Size-A sample of 25 retailers were taken.

Sampling Procedure- Simple random sampling was done.

Study Area- Noida

Data collection method- We have used “QUESTIONNIRE” for collecting data. It was a
structured questionnaire with closed ended and a few open ended questions was used.
 CHAPTER 6 : DATA ANALYSIS AND
INTERPRETATIONS

About 52% of the retailers (13) are selling Aashirvaad aata at present. Whereas 5 are
selling Shakti Bhog , 4 (16%) sell Others brands such as Pillsburry , Nature fresh etc. and
only 3 retailers were selling local mill flour, which means people now a days prefer
packaged aata over traditional ways of getting it processed.

68% (17) retailers confirmed that Aashirvaad brand or ITC Ltd is giving them proper
services while Shakti Bhog’s services were appreciated by 4 (16%) retailers and 3 retailers
told that local mills give them the best services, as in that area working couples were less.
About 10 retailers believe quality should best in case of flour , and if the quality is nice
they purchase that particular brand. Other 40% (10) retailers claimed they are price
conscious as they cater to a segment or price sensitive consumers, they prefer the lesser
priced product anyday. The remaining 20% (5) retailers have a choice of resource, most of
them said they prefer Madhaya Pradesh Wheat flour.

60% (15) retailers store Aashirvaad aata to sell to the customers, where as others preset
local mill (3 retailers) , 4 (16%) prefer Shakti Bhog and 4 retailers prefer others (16%) over
Aashirvaad Aata.
 64% (16) retailers recommend
Aashirvaad Aata if the customer asks them to suggest which one should he buy. 5 retailers
recommend Shakti Bhog to their consumers whereas only 3 were recommending other
brands such as Pillsbury and Nature fresh.

56 % (14) retailers claim that Aashirvaad Aata gives them the highest margins amongst the
others about 6 retailers believe that Shakti Bhog gives them the greatest margin. Only 2
retailers believe that they get highest margin from the Local Mill Flour. And others (3
retailers) believe Nature Fresh and Pillsbury give the highest margin to them.
16 retailers believe that packaging of Aashirvaad Aata is the best, 2 of them believe that
packaging is not a parameter that is important, the Local Mill flour is the best. About 4 of
them said that they like Shakti Bhog’s Packaging the most, whereas 3 retailers like
Pillsbury and Nature Fresh’s Packaging.

52% (13) retailers claim that Aashirvaad has best brand distribution and 7 of them believe
that Shakti Bhog’s distribution is better whereas 3 believe that Local Mill flour is best
preferred by people.
48% (12) retailers said that they are been given specific instructions to promote the brand
Aashirvaad, 32% (8) have been instructed by Shakti Bhog, 4 retailers said they were not
instructed by Local Mill and 1 retailer was instructed by Pillsbury.

48% (12) of the retailers have tried Aashirvaad and hence recommend the same, 10 of
them were not sure as they were promoting other brands as well. And 3 retailers have
never tried Aashirvaad Aata.
 CHAPTER 7: FINDINGS

After conducting the survey we find out the following

• The rate of Aashirvaad flour is more than its competitors (Shakti bhog and local mill
flour)

• The retailers believe that the product is stronger than others but due to high prices, the
sale is less when compared to other brands

• It was also found that the packaging of Aashirvaad Flour is better when compared with
other competitors of them.

• The distribution of Aashirvaad is better than other and there are special instructions
given to the retailer by the brand for their promotion and sales.

• People are price sensitive but many of them believe in quality, so there were mixed
reviews about the choice between quality and the quantity of the product.
 CHAPTER 8: CONCLUSION and
RECOMMENDATIONS

The conclusion is that many of the people belong to the BPL segment i.e. (below poverty
line) So it is impossible for them to purchase costly basic staple such as packaged wheat
flour

If we talk about the price of local mill flour it is between ₹140-₹145 for 10 KGs of wheat

flour whereas the Aashirvaad Aata costs around ₹190-₹200 which is ₹50 more expensive

Than the local mill flour so people need to think twice before spending this much, as they

can buy 5 Kgs more flour from the Local mill in ₹50.

If we compare Aashirvaad Aata with Shakti Bhog, Shakti Bhog is priced at ₹170-₹175,

which is cheaper than Aashirvaad Aata, so ITC should either Reduce the price of increase
the quantity to increase the sales of their product

Recommendations

• ITC should reduce the price for the Aashirvaad Aata.

• They should work on the advertisement for Aashirvaad.

• They should take initiative for the distribution.

• They should give offers and schemes to increase the sales of Aashirvaad.

• They should analyse the strategy of their competitors.

• Awareness should be increased.

 CHAPTER 9: REFERENCES

 https://www.google.co.in/amp/s/www.thehindubusinessline.com/companies/itcs-
aashirvaad-becomes-rs-4000-cr-brand-forays-into-new-
segments/article22948940.ece/amp/

 https://www.scribd.com/doc/47942842/PROJECT-REPORT-ON-ITC-AASHIRWAD-
Repaired

 https://www.livemint.com/Companies/plfaqKWjLR5Ld0XtSG6g9O/ITC-sets-sights-
higher-for-foods-brand-Aashirvaad.html

 https://m.moneycontrol.com/stock/itc/ITC/financials/financials-ratio

 https://www.itcportal.com/about-itc/shareholder-value/annual-reports/itc-annual-
report-2019/pdf/ITC-Report-and-Accounts-2019.pdf

 https://m.moneycontrol.com/stock/itc/ITC/financials/financials-ratio

•ITC ANNEXURES
•ITC REPORTS
•MARKETTING MANAGEMENT- P. KOTLER
•MARKETING RESEARCH-G.C. BERI
•www.itcportal.com
•RESEARCH METHODOLOGY-C.R.KOT