Eyeing on acquisitions, ITC to foray into new FMCG categories; company seeks to be an engine of growth for Indian economy

Kolkata: Diversified conglomerate ITC will foray into new categories and sub-segments in FMCG vertical which will be supported by multi-dimensional investments and strategic opportunities for acquisitions, its Chairman Sanjiv Puri said on Friday. Addressing the company’s shareholders at its annual general meeting, Puri said the company is seeking to be an engine of growth for Indian economy through a vibrant portfolio of future-ready businesses. “Today, around 25 percent of ITC’s segment revenue is from newer FMCG businesses…To accelerate growth in the FMCG businesses, the endeavour is not only to fortify the existing categories towards delivering industry-leading performance but also to foray into newer categories and sub-segments,” he said. [caption id=“attachment_4179443” align=“alignleft” width=“380”] Representational image. Reuters.[/caption] Puri further said, “This would be supported by multi-dimensional investments as also strategic opportunities for acquisitions.” In the last two to three years, ITC has expanded its FMCG portfolio by foraying into new segments. Over 50 products were launched last year to strengthen existing categories and enter newer segments, he added. Reiterating the company’s vision, Puri said, “ITC seeks to be an engine of growth for the Indian economy through a vibrant portfolio of future-ready businesses that are well poised to serve the emerging needs of a growing market through world-class Indian brands.” These businesses also anchor competitive value chains that empower millions of farmers and trade partners, generating livelihoods for more than 6 million people in the country, he added. Stating that ITC’s annual turnover is over Rs 18,000 crore, he said the company has many brands with multi-crore sales. “In terms of annual consumer spend, ‘Aashirvaad’ is today over Rs 4,500 crore; ‘Sunfeast’ over Rs 3,800 crore; ‘Bingo!’ nearly Rs 2,500 crore; ‘Classmate’ over Rs 1,400 crore; ‘YiPPee!’ over Rs 1,100 crore while ‘Vivel’, ‘Mangaldeep’ and ‘Candyman’ are over Rs 500 crore each,” he said. Puri said ITC has been able to create unique competitive advantage by leveraging on its enterprise strength. “ITC’s formidable distribution network enables it to place products in more than 6 million retail outlets,” he said, adding substantive investments are being made in expanding this network and in developing alternative and emerging channels such as modern trade, on-the-go food services, end-to-end cold chain and e-commerce, among others. He also said the integrated fruits, vegetables and perishables value chain has enabled ITC to foray into new segments with a wide range of offerings including frozen food, dehydrated onions, potatoes, mango pulp and prawns. ITC is investing in building state-of-the-art manufacturing infrastructure across India to rapidly scale up the FMCG businesses, build an extremely competitive supply chain and contribute to the country’s Make in India vision, Puri added. “The 20 Integrated Consumer Goods Manufacturing and Logistics (ICML) facilities being progressively built will provide formidable strength to the company’s FMCG brands by enhancing cost efficiency, economies of scale, freshness and close-to-market distribution,” Puri said.