ITC Limited, a diversified conglomerate, has expressed its strong commitment to scaling up its FMCG (Fast-Moving Consumer Goods) business by capitalizing on robust growth platforms and a future-oriented product portfolio. In its recently released annual report, the company highlighted the substantial growth potential in categories with low household penetration, which offers long-term expansion opportunities.
Notably, ITC possesses one of the highest addressable market expansion potentials within the Indian FMCG sector. The annual report emphasizes the strategic investments made by FMCG businesses to develop categories that cater to future consumer needs. Additionally, ITC aims to accelerate growth and value creation by actively pursuing “value-accretive” acquisitions, joint ventures, and collaboration opportunities.
ITC’s FMCG business encompasses branded packaged foods, personal care products, education and stationery items, incense sticks, and safety matches. In the financial year 2022–23, this business segment generated revenue of Rs. 19,000 crores, representing an annual consumer spend of Rs. 29,000 crores.
Regarding the FMCG cigarette business, ITC reported a recovery in the legal industry after two years of pandemic-related disruptions. Stable cigarette taxes, combined with deterrent actions by enforcement agencies, enabled the legal cigarette industry to regain some market share from the illicit trade.
Over the years, ITC has made substantial investments in establishing state-of-the-art integrated consumer goods manufacturing and logistics facilities (ICML) near major demand centres. Recently, the company commissioned a new ICML in Khordha, Odisha, bringing the total number of ICMLs to 11.
ITC has identified exports as a new growth avenue for its FMCG business. With the support of production-linked incentive schemes, the company has expanded its export footprint to over 60 countries, covering biscuits, cakes, snacks, dairy products, and ready-to-eat categories.
The annual report also highlights ITC’s “asset-right” strategy in its hotels business, boasting 120 properties and 11,500 rooms. In the previous fiscal year, the hotel segment contributed around Rs 2,585 crore, with an EBITDA of Rs 831 crore.
ITC is actively involved in combating climate change through its promotion of “climate-smart agriculture,” benefiting over seven lakh farmers across 17 states. Notably, select crops have witnessed a reduction of up to 66% in greenhouse gas emissions, while farmers’ net returns have increased by up to 90% from 2016 to 2021.
The report further highlights ITC’s significant progress in improving waste circularity within its operations, demonstrating the company’s commitment to sustainability.