How ITC influenced the behavior of Indian Consumers.

Presented to :Arvind Arora

Presented by:Sandeep

INTRODUCTION• ITC Limited which previously stood for ‘Imperial Tobacco Company

one of India's foremost private sector companies.• Transform itself from a leading Cigarette manufacturer to an umbrella

group which offers diversified products.• Forayed into field of FMCG, IT, Agri- business to obtain different

revenue stream.• Successful in Hotel Business(ITC welcome group) and collaborated

with Sheraton Corporation.• ITC's wholly owned Information Technology subsidiary, ITC InfoTech

India Limited, is pursuing emerging opportunities in providing end-to-end IT solutions, including e-enabled services and business process outsourcing.

• ITC's Agri-Business is one of India's largest exporters of agricultural products.

 • Vision: Sustain ITC’s position as one of India’s most valuable

corporations through world class performance, creating growing value for the Indian economy and the Company’s stakeholders.

• Mission: To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering superior and sustainable stakeholder value.

VISION & MISSION

NEED FOR DIVERVICATION• Core business of ITC is in the manufacture of cigarettes and

tobacco.• On domestic front, it realized that there was huge revenue

potential for a launch of wider product range to the Indian consumer base.

• ITC’s FMCG business has one of largest retail networks in the country(2 million retailers)

• Government ban on advertisements of cigarettes, high tax rates, decline for the demand of cigarettes.

• The company felt the to diversify from the early 1970 and started entering those business that provides good ROI and a potential for future expansion.

• Leads to concentrate to the other business opportunities.

Hotel

Cigaretes

Incense Sticks

Personal Care

Safety Matches

Agricultu-ral IndustryInformation Technology

Paper boards

Packaged Foods

Stationery

Branded Apparel

DIVERSIFICATION OF ITC

Diversification Strategy

Cigarettes :• Focus to deliver highest product quality and value to consumers helps

them to lead in cigarettes industry.• To boost sales growth introduce festivals packs of brands like: flake

filter, bristol filter, berkeley filter and Scissor filter.

Branded food business(2001):• Launch kitchen of India(Canned foods from ITC Bukhara

restaurants).• Brand offers ready to serve products.• Introduced Aashirwad brand of wheat(atta) in 2002.• Entered into biscuit market by launching Sunfeast brand in 2003.

Stationery products:• Launch greeting cards under the brand name Expressions.• Gain popularity due to introduction of cards in different

languages.

Safety matches • Increase market share and its sales by offering unique designs

and value added features such as AIM.

Hotels(1975)• Four brands- ITC Welcome group, Welcome hotels,

Fortune hotels, Welcome heritage

SWOT AnalysisStrength

•Cigarette market is 22,000 cr and ITC has lion’s share in it•Strong brand recognition and product portfolio •Distribution network•Management

Weakness

•Dependence on tobacco revenues• Negative Connection of Tobacco

Opportunity•Low per capita consumptionOf personal care products

•Rural Market

•E-Choupal

Threat•Competition both Domestic & International

•Increasing Tax on cigarettes

•Regulatory restrictions on cigarettes

•Ban on smoking

• Terror attacks

Porters 5 forces

Low bargaining power of customer

High bargainng power of supplier

High threats of new entrants High rivalry

Low substitutes due to strict laws

In case of tobacco industry

Market share of ITC Ltd.

Outstanding market leader

• Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports.

Gaining market share

• Nascent businesses of Packaged Foods & Confectionery, Branded Apparel and Greeting Cards.

Source: Annual Accounts/Equity research

Corporate Social Responsibility

• ITC's businesses generate livelihoods for over 5 million people.  

• ITC's globally recognised e-Choupal initiative is  the world's largest rural digital infrastructure benefiting over 4 million farming families.  

• ITC's Social and Farm Forestry initiative has greened over 80,000 hectares creating an estimated 35 million person days of employment among the disadvantaged. 

• ITC's Watershed Development  Initiative brings precious water to nearly 35,000 hectares of dry lands and moisture-stressed areas. 

• ITC's Sustainable Community Development initiatives include women empowerment, primary education.

Issues with ITC

• Advertisement ban 2003• Decrease in sales of Cigarettes• Luxury tax• Regulatory laws• Health awareness

THANK YOU

ITC. Touching your life. Everyday