Vous êtes sur la page 1sur 53

ITC

Diversification Strategy
Topics to be covered
• Company Brief
• Time Line
• Business Portfolio of ITC
• SWOT analysis
• BCG matrix
• Strategies
Company Brief
• ITC is one of India's foremost private sector
companies .
• Market capitalisation of nearly US $ 18 billion
• Turnover of over US $ 5.1 Billion
• One of the 8 Indian Companies to feature in
‘Forbes A-list’ for 2004 .
• Only Indian FMCG Company to feature in
Forbes 2000 List .
• Ranks No. 9 among Indian listed Private Sector
Companies by market cap. (@ 31/03/08)
• No. 1 in FMCG Sector.
Time Line Of ITC
1910 ITCL (Imperial ) established in Kolkatta

1925 ITC ‘s Packaging and printing business was set

1953 Imperial converted into a public limited company

1971 It set up a marine product export Division

1974 Company Changed its name to ITC Ltd

1975 ILTC became a part of ITC

1975 launched Hotel business

1986 Established ITC Hotels as a separate division

1990 ITC set up the Agri Business Division

1994 Commissioned Mc .Kinsey to study their business

2000 e-Choupal initiative in Bhopal with Soya farmers

2000 ITC Launched ‘Expressions’

2000 ITC Launched ‘Wills Lifestyle’

2000 ITC – ITC Infotech

2001 ITC formed the food division.

2002 ITC entered the safety match business

2005 ITC introduced Essenza Di Wills


Business Mix of ITC Ltd.
FMCG
• Cigarettes
• Foods
• Lifestyle Retailing
• Greeting, Gifting & Stationery
• FMCG – Others (Safety Matches &Agarbattis)

Paperboards and Packaging


• Paperboards & Specialty Papers
• Packaging
Business Mix of ITC Ltd.
Agri - Business• Agri-Exports
• e-Choupal

Hotels

Group Companies
• ITC Infotech
SWOT Analysis
Strength Weakness
•Brand •Unrelated diversification
•Management

Opportunity Threats
•Rural market •Increasing tax in
•E-choupal Cigarettes
•Health hazard
The BCG Matrix for ITC Ltd.
Stars ?
•Hotels •FMCG- Others
•Paperboards/
Packaging.
•Agri business.
Cows Dogs
•FMCG-Cigarettes
ITC’s corporate strategies
• Create multiple drivers of growth by developing a
portfolio of world class businesses that best matches
organizational capability with opportunities in
domestic and export markets.
• Continue to focus on the chosen portfolio of FMCG,
Hotels, Paper, Paperboards & Packaging, Agri
Business and Information Technology. .
• Enhance the competitive power of the portfolio
through synergies derived by blending the diverse
skills and capabilities residing in ITC’s various
businesses.
Thank You
Special Thanks to Prof. Rakesh Gupta for
giving us such an enormous project

Anoop
Anagha
Madhur
Mansi
Meenakshi
Suparna
FMCG - Cigarettes
ITC’s Cigarettes Business

 Powerful brands across segments


 Leadership in all segments - geographic & price
 Extensive FMCG distribution network
 Direct servicing of 1,00,000 markets & 2 million retail
outlets
 World-class state-of-the-art technology and products
 Investment - Rs.10 billion in six years
Cigarettes: Growth potential

 Of the 58% of adult Indian males who consume tobacco,


barely 15% can afford cigarettes
 Biri : Cigarettes ratio = 10 : 1
 Annual per capita adult cigarette consumption in India is
appx. one tenth world average : 141
 Future growth depends on relative rates of growth of per
capita income and moderation in taxes
Per Capita Adult Cigarette Consumption
(Sticks)

1753
1662

1190

561
488

141

USA China Pakistan Nepal India World Avg.

Source : Based on Cigarette consumption data(2003) from


“World Cigarettes”,ERC Group plc.
Back
ITC Distribution Network
DISTRIBUTION NETWORK(Tobacco Div.)

Bangalore Calcutta Saharanpur Munger

Factories (4)

GODOWNS
GODOWNS BRANCHES
BRANCHES
(18)
(18) (18)
(18)

Information
WHOLESALE
WHOLESALE DISTRIBUTORS
DISTRIBUTORS Goods
(60
(60 PER
PER BRANCH)
BRANCH)

RETAILERS
RETAILERS SECONDARY
SECONDARY
WHOLESALERS
WHOLESALERS
Back
ITC FOOD

“ Branded food business grew


over 57 % than previous year”
(Sustanibility report ITC 2008)
• In 2001 ITC Formed the food Division
• Divided into four main categories
• Ready – to – Eat gourmet.
• Confectionary & chocolates
• Biscuits & cookies.
• Branded Staples.
• Ready to eat Gourment
• Keeping alive long forgotten culinary
traditions ITC introduced Kitchen of indiain
Aug 2001
• The RTE market is approximately
Rs 600-700 million( ITC Food CEO Interview in press
realeses)
• Aashirwad Staples

Sunfeast Buscuits and cookies


range

BINGO was launched in march 2007 it


has captured 16% of market share .
Making it second largest in the market
(4P ‘s magazine 2007 )

Confectionary market :- currently into two brands Minto-O


and Candyman
ITC Food NOW
• With one year of launch BINGO has
attained double digits market share.
• The confectonaray category sales
revenue have increased by 40% than last
year
• RTE is well established over 4500 stores
in US market .
( Sustanability report ITC 2008) Back
PERSONAL CARE
MR. Sandeep kaul (CEO)
perfume
• Essenza di wills in mid 2005 (french)
• Inizio femme (women)
• Inizio homme (men)
ADDITION
Essenza di wills AQUA Range for men
(after shave lotion, deodorant. hair and body
shampoo & bathing bar)
Shampoos
1)Fiama di wills
shampoos
conditioner
shower gels
soap (sep 2007)

2) Vivel di wills
Soap
shampoo,
3) Superia
Soap
shampoo
WILLS LIFE STYLE
• In 2000,ITC Extended Wills to fashion retailing with
an investment of Rs. 2.5 billion and opened first Wills
Lifestyle store in Dec. 2000 in New Delhi to retail
Wills Sport brand.

• LRBD tied up with American Design Intelligence


Group (ADIG) A San Francisco based consultancy
• The LRBD expected to make a turnover of
Rs.450 million for financial year March
31,2003.ITC also plans to take Wills Sport
overseas by setting up in various
countries.
• The move is aimed at wooing the young
upwardly mobile segment, which is
expected to bring 30 per cent growth for
the company.
• From 50 stores at present, the company
plans to have 80 stores by the year-end.
(July 23,08)E.T

Back
EDUCATION & STATIONERY

ITC made its entry into the stationery


business in 2002 with its premium range
of notebooks, followed in the year 2003
with the more popular range to augment
its offering.
• Manufacturer of India's first environment
friendly Elemental Chlorine Free (ECF)
pulp, paper and paperboard.

• Knowledge of image processing, printing


& conversion garnered from its
Packaging & Printing Business.

• Brand Building & Trade Marketing &


Distribution strengths resident in its
FMCG Business.
• The Paperkraft range consists of
premium stationery with a wide variety for
executives to choose from
• Classmate - India's largest National
brand, reaching 50,000 outlets across the
country, has over 300 variants in its range

PAPER BORDS AND SPECIALITY
PAPERS
• ITC’s Paperboards and Specialty Papers
Division is India’s largest and most
technologically advanced paper and
paperboards business. ITC caters to a
wide spectrum of packaging, graphic,
communication, writing, printing and
specialty paper requirements through its
four world-class mills in India.
• Internet and SMS delivering made paper
industry( shrinking industry )( Rs 300 crore
in 2000, Rs 100 crore now)
• A Rs 3,000-crore market, only 15 per cent
of it lies with the organised sector. While
ITC claims it has the largest share of the
market at 8 per cent (as against Navneet
Publications’ 5 per cent and Ballarpur
Industries 2 per cent).

Back
FMCG-Other
Helping in growth of SMEs

• Safety Matches: ITC's brands of safety matches include


iKno, Mangaldeep, VaxLit, Delite and Aim. The Aim is
the largest selling brand of Safety Matches in India. ITC
also exports premium brands to markets such as
Europe, Africa and the USA.

• Aggarbattis: ITC has launched Mangaldeep brand of


Aggarbattis with a wide range of fragrances like Rose,
Jasmine, Bouquet, Sandalwood, Madhur, Durbar,
Tarangini, Anushri, Ananth and Mogra. Mangaldeep is
also being exported to USA, UAE, Bahrain, Nepal,
Singapore, Malaysia, Oman and South Africa.

Back
Paperboards, Paper
&
Packaging
Indian paperboard market

 Annual paperboard demand – appx. 1.1 million tonnes

 Fragmented capacity & obsolete technology

 Low per capita usage at around 6 kgs p.a. (world average – over 50 kgs
p.a.)

 Indian paperboard market growing at 9% p.a.

 Value Added Coated board - the fastest growing segment (20% p.a.) in
India driven by the growing sophistication of the consumer
Paperboard Demand Projections -
Asia
 Asian region demand (excluding Japan) growing by 0.5
million tonnes per annum
 Significant export opportunities for high quality Indian
manufacturers
• ITC paperboards exports - Rs. 2 billion appx.
ITC’s Paperboards Business
 Market leader in growth segment - value added coated boards
 World-class contemporary technology
• Ozone bleached Pulp Mill operations commenced – only one of its kind
in India 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
nearly 80,000 hectares
 Fully integrated operations with in-house pulping capacity at appx.
2.20 lac MT
• Expansion completed; source of sustainable competitive advantage
ITC’s Paperboards & Packaging
businesses
 Capacity expansion projects underway

• 120000 TPA Pulp Mill – commissioning commenced; being


stabilised
• 100000 TPA paper machine (to support Stationery business growth
plans) – trial commissioning commenced
 ITC’s packaging SBU -India’s largest converter of paperboard into
high quality printed packaging
• Leading supplier to Indian FMCG segment

• Provides superior packaging solutions to the cigarettes and new


FMCG businesses
Back
Agri Businesses
- Leaf Tobacco
- Agri Commodities
ITC’s Agri Commodity Business

 Farm linkages in 14 states covering Soya, Wheat, Rice, Marine


products, Coffee etc.

 Leveraging IT for the transformational ‘e-Choupal’ initiative


 Rural India’s largest Internet-based intervention
 Over 38000 villages linked through around 6400 e-Choupals
servicing over 3.5 million farmers
e-choupal:Strategic Thrust
Procurement: cost & quality optimisation

Rural Distribution

Rural retail
• 23 Choupal Saagars operational
• Rapid expansion planned in identified rural markets and
Tier 2, 3 & 4 towns

Back
Hotels & Tourism
Indian hotel industry

 Current supply – appx. 110,000 rooms of which 5 Star category


accounts for appx. 30%
 India needs an additional 50,000 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
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

Category Brand Positioning


Luxury ITC Hotel: Luxury Collection "Mansions of Luxury"
Upper upscale WelcomHotel: Sheraton "Passion for Quality"
Upscale - mid-scale Fortune Hotels "Promise of True Value"
Heritage WelcomHeritage "Unique Experiences"

 Capacity expansion underway at Bangalore and Chennai;


plans for other locations also being progressed
ITC’s Hotel Business

• Manages 24 full service mid-market properties (1700 +


rooms ) under the Fortune Hotels brand
– 100% subsidiary company : Fortune Park Hotels Ltd.
• Also operates 52 properties under the
‘WelcomHeritage’ brand
– Maharaja Heritage Resorts Ltd. 50% JV with Marudhar
Hotels (P) Ltd.

Back
Fact File - ITC Infotech
• Incorporated in October, 2000

• 100% subsidiary of ITC Limited

• 100% owned subsidiaries in US


& UK

• 1,500+ software professionals

• 2,600+ Tech Support


professionals

• 1 Million Sq. Ft. owned


infrastructure
Global Footprints

Moscow
Boston, MA Milton Keynes
Chicago, IL
Hamburg
Beijing
Princeton, NJ Bucharest Seoul
Prague Islamabad
San Jose, CA
Nashville,TN Tokyo
Phoenix, AZ Calcutta
Cairo
Adis Ababa
Mexico Kuala Lumpur
Lagos Bangalore

Bogota Singapore
Jakarta

Sydney
South Africa

Implementation across 42 Countries, Support for 142 countries


DEVELOPMENT CENTRE 4 global delivery centres
CO-LOCATED OFFICE 100% owned subsidiaries in US & UK,
PROJECT OFFICE Offices in India, USA, UK, Czech Republic and Malaysia
Key Areas of Business

BPO/Technical Helpdesk Services


CRM Services

Travel/Hospitality
Custom Applications (Microsoft, Java)

Manufacturing
ERP Services
Mainframe
Infrastructure Services
Multimedia & Animation Services

Retail
Strategic Consulting
Testing Services

Technology Practices Domain Practices


Select Clientele

Nike

Back