2. Chairperson : Y C Deveshwar Directors : S S H Rehman, Nakul
Anand, A Singh, PV Dhobale, K Vaidyanath, K N Grant, A Baijal, B
Vijayaraghavan J P Daly, H G Powell, P B Ramanujan, B Sen, R S
Tarneja, CEO, Yogesh Chander Deveshwar
3. HISTORY ITC was incorporated on August 24, 1910 under the
name Imperial Tobacco Company of India Limited. Name changed from
Imperial to Indian tobacco comapany in the year 1970 then to ITC
limited in the year 1974. One of the 8 Indian Companies to feature
in Forbes A-list for 2004 Only Indian FMCG Company to feature in
Forbes 2000 List Among top in : Sustained value creation (BT-Stern
Stewart survey) Operating profits Cash Profits Ranks No. 4 among
Indian listed Private Sector Companies by market cap. (@ April 09)
No. 1 in FMCG Sector Rated as one of Indias Most Respected
Companies (IMRB-Businessworld Survey 2006) Diversified conglomerate
with interests ranging from Tobacco to Hospitality
4. INDIAN TOBACCO COMPANY 24 Aug1910 ITC incorporated under the
name of 'Imperial Tobacco Company of India Limited'. 1925 ITCs
Packaging & Printing Business Division was set up as a
strategic backward integration for ITCs Cigarettes business. 1974
The Company's ownership progressively Indianised, and the name of
the Company was changed to ITC Limited (Indian tobacco company).
1975 The Co. launched its HOTEL BUSINESS which was named
ITC-Welcomgroup Hotel Chola. 1979 ITC entered the Paperboards
Business by promoting. ITC Bhadrachalam Paperboards Limited, which
today has become the market leader in India.
5. CIGARETTES 6 Market leader in India. Highly portfolio of
brands includes Insignia, India kings, Classic, Gold Flake, Silk
Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake.
6. WHY HOTELS AND TOURISM????? ITC. Touching your life.
Everyday
7. BRAND CATEGORY POSITIONING ITC HOTEL LUXURY COLLECTION
MANSION OF LUXURY WELCOME HOTEL SHERATON UPPER UP SCALE PASSION FOR
QUALITY FORTUNE HOTEL UPSCALE - MIDSCALE PROMISE OF TRUE VALUE
WELCOME HERITAGE HERITAGE UNIQUE EXPERIENCES
8. WHY FMCG????? Entering the foods business was itself a
strategic decision for ITC. ITCs core business, tobacco, was under
pressure owing to several factors like government bans on
advertising and on smoking in public places. Hikes in the excise
duty for cigarettes, and anti tobacco campaigns, ITC planned to
deploy its surplus in the packaged food business where it saw huge
business potential.
11. MARKETING STRATEGIES DISTRIBUTION NETWORK Huge distribution
network due to its tobacco business. Today, ITCs Bingo and Sunfeast
are available at nearly 1.8 million outlets whereas Parle is
available at only 1.5 million outlets.
12. Market differentiation In Biscuits also, ITC launched
differentiated products in each and every segment. For e.g. it
introduced an Orange Marie, a butterscotch cream biscuit, chilli
flakes in a biscuit and even honey flavor under the Sunfeast brand.
In March 2005, ITC Foods launched Sunfeast Pasta, a whole wheat
based product targeted at children. It was expected to compete with
products like Nestles Maggie noodles. With this strategy ITC built
for itself new markets.
13. Cost control strategy ITC realized that they have to offer
products at a price which is either equal or less than what the
competitors are offering. ITCs printing and packaging business
provided high-quality, cost-effective, and innovative packaging.
ITC also enjoyed cost advantages over its competitors owing to its
electronic procurement system called e-Choupal.
14. Diversification of products Bingo, ITC has come up with 21
flavors in comparison to its competitor Lays of Frito Lay which has
only 4 major flavors. Extensive advertising They hired the best
professionals and the best ambassadors in the country to make their
products famous. The tagline "Jab Laila ko karna tha impress to
majnu ne khayi mint o fresh" has stood the test of times and is
still widely known and remembered. 10 to 15 spots per channel per
day on youth channels such as MTV and Star World, mass Hindi
channels like Zee and Star TV, and news 19 channels. It also had
around 20 spots on a variety of radio channels and advertised in
most leading national dailies. Top-30 cities, over 1,000 outdoor
hoardings advertised the product. ITC spent close to Rs 100 crore
on marketing.
15. Regular introduction of new products ITC has been expanding
its distribution network aggressively and also their product range.
In biscuits and wafers range, it is launching new products or
flavors week after week. Innovation ITC was innovative in
identifying the market or niche for all its products.
16. AGRO BASED INDUSTRY
17. o Basic components of ITC are from the agricultural sector.
o Cost reduction strategy. o Direct raw material without
involvement of third party. o Direct touch with farmers.
18. ITC e-Choupal Started in the year 2000 Target Area so far
38,000 villages, 6500 kiosks, 9 states Wholly owned by ITC Why it
become a success ? Only initiative to attempt to combine Services
and an Effective Business Model successfully Designed to address
the issues such as: 1. Fragmented farms 2. Weak institutions 3.
Involvement of intermediaries 4. Information Asymmetry
19. A win-win Deal Farmers gain Better information Content
Better info timing Less transportation Cost Transaction duration
Weighing accuracy Professionalism ITC gains Disintermediation
savings Freight costs Quality control Risk management
20. Transaction cost in Mandi Chain (before e-Choupal)
21. Transaction cost in Mandi Chain (after e-Choupal)
22. SWOT ANALYSIS Strength Cigarette market is 22,000 cr and
ITC has lions share in it Strong brand recognition and product
portfolio Distribution network Management Weakness Dependence on
tobacco revenues Negative Connection of Tobacco Opportunity
Consumption Of personal care products Rural Market E-Choupal Filter
cigarette segment of less than 60mm size Threat Competition both
Domestic & International Increasing Tax on cigarettes Excise
duty on unfiltered cigarettes less than 60mm in length was
increased 387% last year Hike was 142% for those between 61mm and
70mm long. Regulatory restrictions on cigarettes Ban on
smoking
23. ITC. Touching your life. Everyday
24. SOMETIMES, NOT TAKING RISK IS THE BIGGEST RISK YC Deveshwar
Y C Deveshwar