The strategy reset covers multiple sectors in which the company operates including—agriculture, consumer goods, paper and packaging as well as hospitality.
The company has already been stepping up investments in increasing digital capabilities across businesses. For instance, a smart ecosystem with an Integrated Real-Time Operations Platform continues to be deployed across the organisation, enabling next-generation supply chains and smart manufacturing with digitally enabled factories, it said.
More such initiatives are underway within the organization as it builds a ‘FutureTech’ enterprise by investing in digital technologies, creating innovative business models and tapping newer opportunities.
Puri said the company is also proactively exploring “value accretive inorganic opportunities” as it plans to expand the scope of its fast-moving consumer goods business that has grown to over ₹22,000 crore in annual consumer spends and reaches 150 million households.
“As part of the next horizon vision, ITC is proactively exploring inorganic opportunities. This was manifest in the earlier acquisition of Savlon and Nimyle brands, and more recently of Sunrise Foods Pvt Ltd,” Puri said. ITC will continue to evaluate such value accretive inorganic opportunities as an additional pillar of growth, he added.
ITC continues to be bullish about the Indian consumer space. As a result, the company’s FMCG portfolio has been “revitalised” to make it future-ready, address emerging trends and develop categories of the future, he added.
It has also put in place a new strategy of organisation within its foods division—that sells brands such as Aashirvaad, Sunfeast, Bingo chips among others. As part of the change “empowered and integrated teams” have been formed to focus on specific product markets.
This will also mean that the company will pull back from businesses not in sync with ITC’s future growth ambition. “Business segments that were incongruent to our growth aspirations, such as the Lifestyle Retailing Business, have shrunk,” Puri said.
ITC set ambitious targets to turn its FMCG brands into Rs1 lakh crore business over the span of this decade. It has a portfolio of 25 consumer-centric brands in India. The company competes with Hindustan Unilever Ltd, which sells brands such as Kissan jams, Brooke Bond Taj Mahal tea and Horlicks health food drinks.
Citing its acquisition of brands such as Savlon and Nimyle, a neem-based natural floor cleaner, ITC said the brands have grown 13x and 4x, respectively, since their acquisition. Last fiscal, Savlon witnessed heightened demand and reached nearly ₹1,200 crore in annual consumer spends, the company said in its FY21 annual report.
Aashirvaad offers a larger play in staples and also addresses value-added adjacencies such as organic atta and pulses, gluten-free and sugar release control atta as well as vermicelli and instant meals, Puri said.
In FY20, Aashirvaad reported nearly ₹6,000 crore in consumer spends; while ITC’s biscuit brand Sunfeast recorded consumer spends of over ₹4,000 crore.
ITC will continue to drive “sustained investments” into its mega brands.
“These purposeful brands anchor large categories and have immense headroom to grow given the relatively lower household penetration currently, and particularly with per capita incomes rising in the future. Sustained investments to drive innovation and accessibility will continue to fuel growth and enhance market standing,” Puri said.
It has also been stepping up investments in integrated consumer goods manufacturing facilities (ICML); 5 such ICML’s have been set up recently, taking the total to 9 such mega units.
This distributed manufacturing footprint enables economies of scale and scope, optimises costs and ensures superior market servicing and freshness, Puri added.
Meanwhile—within its agriculture business ITC will launch a super app during the year. ITC-MAARS or Metamarket for Advanced Agriculture and Rural Services will provide a range agricultural solutions such as hyperlocal services, AI-based personalised advisories, as well as an online marketplace.
“ITC-MAARS will lend new wings to ITC e-Choupal and create a robust ‘phygital’ eco-system to deliver seamless customised solutions to farmers, anchored by FPOs, whilst creating new revenue streams, strengthening sourcing efficiencies and powering your Company’s world-class Indian brands,” Puri said.
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