MARKET RESEARCH

OF
ITC LTD

Submitted in partial fulfillment

Bachelor of Commerce
in
Finance

Under the Guidance of Submitted By

Subhajit Samaddar Soumyajit Ghosh
Roll No - 837
Batch - 2019 - 2022

Mahadevananda Mahavidyalaya
SN Banerjee Rd, Monirampore, Kolkata, 700120

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 ITC LIMITED

Introduction

Established in 1910 as the Imperial Tobacco

Company of India Limited, the company was
renamed as the India Tobacco Company Limited
in 1970 and later to I.T.C. Limited in 1974. The
company now stands renamed to ITC Limited,
where "ITC" today is no longer an acronym.As of
2019–20, ITC had an annual turnover of US$10.74
billion and a market capitalisation of US$35
billion. It employs 36,500 people at more than 60
locations across India.across India.
locations
ITC Limited is an Indian conglomerate company
headquartered in Kolkata. ITC has a diversified
presence across industries such as FMCG, hotels,
software, packaging, paperboards, specialty
papers and agribusiness. The company has 13
businesses in 5 segments. It exports its products
in 90 countries. Its products are available in 6
million retail outlets.
million retail outlets.

 Headquarters Virginia House, Kolkata, West Bengal, India

Formerly :- Imperial Tobacco Company of India Limited (1910–1970)

India Tobacco Company Limited (1970–1974)
I.T.C. Limited (1974–2001)
ITC Limited (2001–present)

Type :- Public

Traded as :- BSE: 500875 NSE: ITC

BSE SENSEX constituent
NSE NIFTY 50 constituent
ISIN :- INE154A01025
Industry :- Conglomerate
Predecessor :- W.D. & H.O. Wills
Founded:- 24 August 1910; 111 years ago
Headquarters :- Virginia House, Kolkata West Bengal, India
Area served :- Indian subcontinen
Gulf countries
Key people :- Sanjiv Puri (Chairman & MD)
Product :- Consumer goods Apparel Education Hotels and Resorts
Paperboards & Specialty papers Packaging Agribusiness
Information technology
Cigarette.
Revenue :- Increase₹74,979 crore (US$9.8 billion) (2020)

Operating Increase₹20,081 crore (US$2.6 billion) (2020)

Income :-

Net income :- Increase₹13,032 crore (US$1.7 billion) (2020)

Total assets :- Increase₹77,367 crore (US$10 billion) (2020)

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Total equity :- Increase₹62,021 crore (US$8.1 billion) (2020)
Number
of
employees :- 36,500 (2021)

Subsidiaries :- ITC Hotels Classmate (stationery)

ITC Paperboards and Specialty
Papers Division ITC Infotech
Sunrise Foods

Website :- www.itcportal.com

History
Towards Indianisation and Business Diversification :-

ITC Limited" was originally named "Imperial Tobacco Company of

India Limited", succeeding W.D. & H.O. Wills on 24 August 1910 as a
British-owned company registered in Kolkata. Since the company
was largely based on agricultural resource, it ventured into
partnerships in 1911 with farmers from the southern part of India to
source leaf tobacco. Under the company's umbrella, the "Indian Leaf
Tobacco Development Company Limited" was formed in Guntur
district of Andhra Pradesh in 1912. The first cigarette factory of
the company was set up in 1913 at Bangalore.

In 1928, construction began for the company's headquarters, the

'Virginia House' at Calcutta. ITC acquired Carreras. Tobacco
Company's factory at Kidderpore in 1935 to further strengthen its
presence.[citation needed] ITC helped to set up indigenous cigarette
tissue-paper-making plant in 1946 to significantly reduce the
import costs and a factory for printing and packaging was set up at
Madras in 1949.The company acquired the manufacturing business
of Tobacco Manufacturers (India) Limited and the complementary
lithographic printing business of Printers (India) Limited in 1953.

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Towards Indianisation and Business Diversification :-

tThe company was converted into a Public Limited Company on 27

October 1954. The first step towards Indianization was taken in the
same year with 6% of the Indian shareholding of the company. ITC
also became the first Indian company to foray into consumer
research during this time. During the 1960s, technology was given
more focus on setting up cigarette machinery and filter-rod
manufacturing facilities aimed at achieving self-sufficiency in
cigarette-making.

Ajit Narain Haskar became the company's first Indian chairman in

1969 and this was crucial in building up the Indian management for
the company. As the company's ownership was progressively
Indianised, under Haskar's leadership, the name of the company
was changed from "Imperial Tobacco Company of India Limited" to
"India Tobacco Company Limited" in 1970. ITC also became
the first company in India to start from the 1971 Scissor's Cup.
Innovative market campaigns and electronic data processing were
started in the 1970s.

In 1973, ITC set up its integrated research center in Bangalore, aimed

at diversification and venturing into newer businesses with research
and development. With the unfolding diversification plans, the name
of the company was changed to 'I.T.C. Limited' in 1974. The Indian
shareholding grew further to 40% during this time. ITC entered into
the hospitality sector with hotel business in 1975 with the acquisition
renaming of ITC Welcomgroup Hotel Chola in Madras. ITC chose the
hospitality sector for its potential to earn high levels of foreign
exchange, create tourism infrastructure and generate large-scale
direct and indirect employment.
The shareholding went over 60% in 1976 and more hotels were started
by the company in the following years. ITC Sangeet Research
Academy was set up at Calcutta in 1977. In 1979, ITC entered the
paperboards business by promoting ITC Bhadrachalam Paperboards
Limited. J N Sapru took over as the company's chairman in 1983 and
the international expansion started with the acquisition of
Surya Nepal Private Limited in 1985. The year 1986 saw vigorous
moves from the company with the opening of an Indian restaurant in
the city of New York, acquisition and renaming of Vishvarama Hotels
to ITC Hotels Limited,

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setting up of two new ventures – the ITC Classic Finance Limited and
ITC Agro Tech Limited under its umbrella. ITC also entered into the
edible oils industry with the launch of the Sundrop brand of cooking
oils in 1988. Tribeni Tissues Limited was acquired in 1990. K L Chugh
assumed the role of chairman in 1991 and ITC Global Holding Private
limited was started as an international trading company in Singapore
in 1992. In 1994, all the hotels under the company were transferred
into the listed subsidiary company ITC Hotels Limited. ITC, through
the brand Wills, sponsored the 1996 Cricket World Cup.

Y.C. Deveshwar took over as the company's chairman in 1996 and the
corporate governance structure was re-crafted to support the
effective management of multiple businesses. ITC exited from edible
oils business and financial services; sold the ITC Classic Finance
Limited to ICICI Limited and handled the Sundrop business to
ConAgra Foods Limited in 1998. In the year 2000, an innovative
initiative for farmers called "e-Choupal" was started in Madhya
Pradesh 2000. The same year witnessed the launch of ITC's Wills
Sport range of casual wear with its first retail outlet in New Delhi and
ITC's entry into stationery products and gifting business introducing
the 'Expressions' range of greeting cards and Classmate notebooks. A
wholly owned information technology subsidiary, ITC Infotech India
Limited was also started in 2000 and the ITC Bhadrachalam
Paperboards Limited was merged into ITC Limited. The name of the
company was changed to "ITC Limited" omitting the dots and
adapting the strategy "No stops for ITC" in 2001. An employee stock
option scheme was introduced for the first time and a web portal for
the company was launched. Subsidiaries for ITC Infotech were set up
in the United Kingdom and the USA

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 Sanjiv Puri
Chairman & Managing Director

Sanjiv Puri (59) is the Chairman & Managing Director of ITC Limited

Puri was appointed as a Wholetime Director on the Board of ITC with effect
from December 6, 2015, Chief Executive Officer in February 2017 and re-
designated as the Managing Director in May 2018. He was also appointed as
the Chairman effective May 13, 2019. He is an alumnus of the Indian
Institute of Technology, Kanpur, and Wharton School of Business

Puri joined ITC in January 1986. During his career of over three
decades at ITC and its subsidiaries, he has held several business
leadership positions and also handled a wide range of responsibilities
in manufacturing, operations and information & digital technology.
Puri served as Chief Operating Officer of ITC between July 2016 and
January 2017, and prior to that as President, FMCG Businesses -
Cigarettes, Foods, Personal Care, Education & Stationery Products,
Matches and Agarbattis, since December 2014. Earlier, he was the
Divisional Chief Executive of the Tobacco Division since 2009, with
additional responsibility for the Company's Trade Marketing &
Distribution Vertical. He led ITC Infotech India Limited ('I3L'), a
wholly owned subsidiary of ITC, as its Managing Director from May
2006 to August 2009. Presently, Puri is the Chairman of I3L and its
wholly owned subsidiaries in the UK and the USA. Puri served between
2001 and 2006 as the Managing Director of Surya Nepal Private
Limited, a joint venture subsidiary company of ITC in Nepal, and is
presently its Chairman. Earlier, he has also been a Director on the
Board of The Tobacco Institute of India, a Member of the Board of
Governors of the Media Research Users Council, and has served on the
Executive Council of The Indian Society of Advertisers.

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Puri has also served as the Chairman of the Expert Group constituted
by the Fifteenth Finance Commission of the Government of India to
promote agri-exports and as a Member of the technology discussion
group 'Farm to Table -driving India's agriculture sector digitally'
constituted by the NITI Aayog. He has been a Member of the Advisory
Council constituted by the Odisha State Government for promoting
manufacturing ecosystem in the State, and a Member of the Expert
Group constituted by the Punjab State Government to recommend an
action plan in the aftermath of COVID-19 crisis.

Presently, Puri serves on the National Executive Committees of CII and

FICCI as well as on the Steering Committee of FICCI. He is the
Chairman of the Advisory Council of the CII-ITC Centre of Excellence
for Sustainable Development. He is also the Chairman of the CII
National Council on Agriculture, and a Member of the CII Economic
Affairs Council as well as the CII Policy Council. He is the Chairman of
the CII Task Force on Business Continuity and the Co-Chair of the
Covid Task Force

Puri is also on the Governing Board and the Executive Board of the
Indian School of Business, Hyderabad. He is a Director on the Board of
US-India Strategic Partnership Forum, Co-Chair of the 'Business
Commission to Tackle Inequality' set up by the World Business Council
for Sustainable Development, and a Member of the BRICS Business
Council

Puri was conferred the 'Distinguished Alumnus Award of the year 2018'
by the Indian Institute of Technology, Kanpur. He was recently
honoured with the 'IMPACT Person of the Year, 2020' Award by
exchange4media, a leading online news platform

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ITC is one of India's foremost private sectors companies with a
market capitalization ofnearly US $ 15 billion and a turnover of over
US $ 4.75 billion. ITC is rated among theWorld's Best Big Companies,
Asia's 'Fab 50' and the World's most ReputableCompanies by Forbes
magazine, among India's Most Respected Companies by
BusinessWorld and among India's Most Valuable Companies by
Business Today. ITC also ranksamong India's top 10 `Most Valuable
(Company) Brands', in a study conducted by BrandFinance and
published by the Economic Times

ITC has a diversified presence in Cigarettes, Hotels, Paperboards &

Specialty Papers,Packaging, Agri-Business, Packaged Foods &
Confectionery, Information Technology,Branded Apparel, Greeting
Cards, Safety Matches and other FMCG products. While ITCis an
outstanding market leader in its traditional businesses of Cigarettes,
Hotels,Paperboards, Packaging and Agri-Exports, it is rapidly
gaining market share even in itsnascent businesses of Packaged
Foods & Confectionery, Branded Apparel and Greeting Cards

As one of India's most valuable and respected corporations, ITC is

widely perceived to bededicatedly nation-oriented. Chairman Y C
Deveshwar calls this source of inspiration "
acommitment beyond the market ". In his own words: "
ITC believes that its aspiration tocreate enduring value for the
nation provides the motive force to sustain growingshareholder
value. ITC practices this philosophy by not only driving each of
itsbusinesses towards international competitiveness but by also
consciously contributingto enhancing the competitiveness of the
larger value chain of which it is a part ."

ITC's diversified status originates from its corporate strategy aimed

at creating multipledrivers of growth anchored on its time-tested
core competencies: unmatched distributionreach, superior brand-
building capabilities, effective supply chain management
andacknowledged service skills in hotelier. Over time, the strategic
forays into new businesses are expected to garner a significant share
of these emerging high-growthmarkets in India.

ITC's Agri-Business is one of India's largest exporters of

agricultural products. ITC isone of the country's biggest foreign
exchange earners (US $ 2.8 billion in the lastdecade).

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The Company's 'e-Choupal' initiative is enabling Indian agriculture
significantly enhance its competitiveness by empowering Indian
farmers through the power of the Internet. This transformational
strategy, which has already become the subject matter of acase study
at Harvard Business School, is expected to progressively create for
ITC a hugerural distribution infrastructure, significantly enhancing
the Company's marketing reach.

ITC' wholly owned Information Technology subsidiary, ITC InfoTech

India Limited, isaggressively pursuing emerging opportunities in
providing end-to-end IT solutions, including e-enabled services
and business process outsourcing.
ITC' production facilities and hotels have won numerous national and
internationalawards for quality, productivity, safety and environment
management systems. ITC wasthe first company in India to
voluntarily seek a corporate governance rating.

ITC employs over 21,000 people at more than 60 locations across

India. The Company continuously endeavors to enhance its wealth
generating capabilities in a globalizing environment to consistently
reward more than 3,95,000 shareholders, fulfill theaspirations of its
stakeholders and meet societal expectations. This over-arching vision
of the company is expressively captured in its corporate positioning
statement :

Objective :-
The primary objective of this study is to systematically explore the
determinantsresponsible for the competitive advantage of ITC Limited
and how ITC developed new product lines in its foods business
drawing on its competencies in brand-building, R&D, packaging, and
distribution. However, market analysts were not sure whether ITC
wouldachieve success in all the food categories that it had entered.

Why people are buying the products.

What all the things which influences them to buy.
To understand how ITC
has diversified themselves to a multi
product corporationfrom a single product company

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 Research Methodology :-
The researcher has used secondary data, magazines, internet, books,
some market surveyusing marketing tools like asking question through
phone, personal interview etc.

Profile
ITC in FMCG
Cigarette
ITC is the market leader in cigarettes in India. With its wide range of
invaluable brands, ithas a leadership position in every segment of the
market. It's highly popular portfolio of brands includes Insignia, India
Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan,
Berkeley, Bristol and Flake.

The Company has been able to build on its leadership position because
of its singleminded focus on value creation for the consumer through
significant investments in product design, innovation, manufacturing
technology, quality, marketing anddistribution. All initiatives are
therefore worked upon with the intent to fortify market standing in
thelong term. This in turns aids in designing products which are
contemporary and relevantto the changing attitudes and evolving socio
economic profile of the country. Thisstrategic focus on the consumer
has paid ITC handsome dividends..

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 Food's :-
ITC made its entry into the branded & packaged Foods business in August
2001 with the launch of the Kitchens of India brand. A more broad-based
entry has been made since June 2002 with brand launches in the
Confectionery, Staples and Snack Foods segments. The Foods business
is today represented in 4 categories in the market.
These are:

* Ready To Eat Foods

* Staples.
* Confectionery
* Snack Foods

In order to assure consumers of the highest standards of food safety and

hygiene, ITC isengaged in assisting outsourced manufacturers in
implementing world class hygienestandards through HACCP certification.
The unwavering commitment to internationally benchmarked quality
standards enabled ITC to rapidly gain market standing in all its 6 brands:

* Kitchens of India
* Aashirvaad.
* Sunfeast.
* mint-o* Candyman
* Bingo!

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Lifestyle Retailing :-

ITC Lifestyles Retail Business has Established a Nationwide retailing

presence through its Wills Lifestyle chain of exclusive specialty stores.
Wills Lifestyle, the fashion destination, offers a tempting choice of
Wills Classic work wear, Wills Sportrelaxed wear, Wills Clublife
evening wear, fashion accessories and Essenza Di Wills – anexclusive
range of fine fragrances and bath & body care products and Fiama Di
Wills - arange of premium shampoos and shower gels. Wills Lifestyle
has also introduced Wills Signature designer wear, designed by the
leading designers of the country.

Wills Classi work wear was launched in November 2002, providing the
premiumconsumer a distinct product offering and a unique brand
positioning.

ITC forayed into the youth fashion segment with the launch o John
Player in December 2002 and John Players is committed to be the No. 1
fashion brand for the youth.

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Education & Stationary Product :-
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. ITC's stationery Brands are marketed
as "Classmate" and "Paperkraft", with Classmateaddressing the needs of
school goers and Paperkraft targeted towards college students and
executives.

Agarbattis :-

As part of ITCs business strategy of creating multiple drivers of growth

in the FMCGsector, the Company commenced marketing Agarbattis
(incense sticks) sourced from small-scale and cottage units in 2003.

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 Hotels :-
ITC entered the hotels business in 1975 with the acquisition of a hotel in
Chennai, which was then rechristened ITC Chola. Since then the ITC-
Welcomgroup brand has becomesynonymous with Indian hospitality.
With over 90 hotels in 77 destinations.

Packaging :-
ITC's Packaging & Printing Business is the country's largest convertor
of paperboardinto packaging. It converts over 50,000 tonnes of paper
and paperboard per annum into avariety of value-added packaging
solutions for the food & beverage, personal products, cigarette, liquor,
cellular phone and IT packaging industries. It has also entered
the Flexibles and Corrugated Cartons business.

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 Agri Business :-
e-choupal
The unique e-Choupal model creates a significant two-way multi-
dimensional channel which can efficiently carry products and services
into and out of rural India, while recovering the associated costs
through agri-sourcing led efficiencies. This initiative nowcomprises
about 6500 installations covering nearly 40,000 villages and serving
over 4million farmers.

Leaf Tobacco :-

ITC is the largest buyer, processor and exporter of leaf tobaccos in

India - creating aglobal benchmark as the single largest integrated
source of quality tobaccos. Servingcustomers in 50 countries across
more than 70 destinations, ITC co-creates and deliversvalue at every
stage of the leaf tobacco value chain.

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 Information Technology :-
ITC Infotech offers IT services and solutions across five key industry
verticals: Banking, Financial Services & Insurance (BFSI),Consumer
Packaged Goods (CPG) & Retail, Manufacturing & Engineering
Services, Travel, Hospitality & Transportation and Media &
Entertainment.

ITC Infotech, a global IT services company, is today one of India’s fastest

growing ITservices and solutions providers.

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Initiatives taken - Let's put India first :-
ITC is committed to a national agenda of raising agricultural productivity
and making therural economy more socially inclusive. ITC believes that
the urgency and scale of thesetasks make market linked solutions and
innovations more effective and sustainable thancapital intensive
approaches.

Social & farm forestry :-

ITC has helped to bring nearly 13,000 hectares of wasteland under social
forestry benefiting more than 16,000 poor households in 466 villages.
ITC’s social forestry programme simultaneously addresses the livelihood
problems of marginal farmers and the ecological imperative of
regenerating biomass and nurturingdepleted soils.

Watershed Development :-

ITC’s watershed initiatives have led to an improvement in soil and

moisture regimes –there is more land under irrigation, water tables
have risen and farmers can harvest morethan one crop, making it
possible to live off the land round the year.

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Agricultural Development :-
ITC offers facilitation to farmers to form agri-business societies, pool
knowledge andresources, improve productivity and quality, and reach
out beyond local markets to sell at better margins.

Woman empowerment :-
The confidence and skills generated among women by forming credit
groups andmanaging businesses become assets to their communities.

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Livestock Development :-

The milk marketing co operatives represent exemplary change in rural

enterprise, awayfrom dependence on agriculture and local markets.

Primary Education :-
School going becomes an empowering process for the child and the
community. Theawareness of entitlements like education and health
grows, along with a sense of thecommunity’s responsibility.

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Findings & Analysis :-

Analysis of Marketing Activities

The Product Mix Of ITC

ITC LTD

Agri Business FMCG - Cigarettes

Paperboard &
FMCG - Others
Packaging

Infotech Hotels

ITC had lunched nearly all the products range off Non tobacco Products;
they are veryaggressive in their distribution of such products. The
existing network of ITC’sCigarettes distribution is being used extensively
for the sales all products of ITC Fooddivision. They are trying to
capitalized the market by associating the products with theITC brand.
ITC Ltd.FMCG-CigarettesFMCG-OthersHotels Agri Business
Paperboards & Packaging Infotech.

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ITC Pricing Strategy :-

The pricing of the ITC food division depends upon the Customers’
demand schedule, thecost function and the competitors’ price. The
pricing of the company is such that it catersto the need of all income
groups of people but special provision has been kept for Lowand
middle income group, and their pricing are competitive with respect to
other playerslike Britannia, Parle and Briskfarm.The company follows
the Going rate pricing that is the price of the product depends uponthe
competitors price. The firm chooses pricing more or less the same as
Market leader.

ITC Promotional Activities :-

A particular budget is allocated for the promotion of the products, the

local promotion scheme is decided by the Area Sales Manages, it give
its suggestion to the District officeand that is forwarded to the Head
Quarter in Kolkata. In another promotional scheme for Biscuits a
particular number of cases is given freely tothe distributors according
to the amount of sale they make, this was a drop downpromotion
i.e. of the number of free cases that a particular distributors gets, off
them acertain part is reserved for the retailers and customer if they
buy a certain level of biscuitquantity.

ITC Distribution :-

Buoyed by a strong distribution network ITC is likely to retain its

market share in thecigarettes business; the ban on advertisements is
likely to work in favour of ITC thanks tothe recall factor.

The company's reliable distribution network also ensures superior

inventory turnoverthan its peers.

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BCG Matrix

BCG matrix

High
Priority Divest
Market Growth

Invest

Kill
Low

High Market Share Low

Star Question Mark

Agri Business FMCG

Hotels Food

Paperboards & Packaging

Money Wrong
FMCG ITC Infotech

Cigarettes

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 Consumer Buying Decision :-

Reason for Purchasing

70
60
50
Percentage

40
30
20
10
0
Price Quality Promotion Past
Experiences

The main driver in attracting the consumers is Quality of the product

itself with nearly 65% of the people surveyed citing it as the main
criterion for choosing the product,followed by past experience of the
consumer with the brand (17.6%). Price was thirdcriterion with a
percentage of 11.7% of the people surveyed gave importance during
buying.

Affectiveness of Advertisment
30
25
No. Of Customers

20
15
10
5
0

Highly Affective Somewhat Not Affective

Affective Affective

An effective advertisement will attract more and more customer to buy,

helps in the brand and image formation, and informative in telling the
USP of the product.

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 Customer Satisfaction
60
Number of Customer

50
40
30
20
10
0
Extremely Satisfied Somewhat Not
Satisfied Satisfied Satisfied

The above graph shows the experience of the customer after using the
product i.e. whether they were satisfied with the product as a whole.
The higher the satisfaction level higher will be the chances that the
customer will buy the same brand again and again thatleads to the
building of the Brand loyalty.

Availability

Yes 88.20%

No 11.8%

The Availability of the Product itself determine the effectiveness and

the penetration of the distribution channel of that particular brand
among the people.

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 Analysis on Diversification :-

ITC has been a leader in the tobacco business, but it realize from the up
coming trendsthat remaining with a single business is not a noble
thought, moreover the company was threatened of the anti-tobacco
campaign. Therefore the company decided to venture intoInfo Tech
with ITC InfoTech, foods via Kitchens of India, greeting cards
throughExpressions and lifestyle retailing through Wills Sport. Each of
these is intended to drawrevenues of at least Rs. 250 crore by 2005.

ITC was a cash rich company with a liquidity of Rs.8816 million in the
cigarette business, even though the company understood the need and
usefulness of diversification. The writer in the article is mainly
concerned with the way ITC spreads its wings in thelifestyle segments,
he writes:” forty-five stores in 34 cities in just under a year, selling
anexpensive fashion brand of relaxed-wear. If retail swamp-out and
brand salience were thegoals, ITC’s Wills Sport would be on a victory
lap already.

The company has started its retail stores not only in Indian metros but
also in the smalltowns like Ranchi, Jabalpur, Gwalior, Belguam,
Ernakulam etc. the article also talksabout the strong market campaign
done by the company, it also describe how thecompany has used its
brand image to attract the Indian youth. It also tells about thestrategy
adopted by the company to differentiate itself in this segment, like the
companyis outsourcing its designs form the American Design
Intelligence Group (ADIG), a SanFrancisco, US-based garment and
retail consultancy. Now it has its own six-memberteam, even as
itcontinues a tie-up with Science & Designs, an Italian fashion
designhouse – through which it keeps a watch on hot western labels
such as Banana Republicand Armani Exchange.

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Financial Analysis of ITC Ltd :-
In the quarter ended June, 07, ITC’s net profit grew 20% to Rs.782.87
million and netsales rose up 17% to Rs.3325.23 million. This profit
growth was primarily driven by itscigarette business because of high
margin and agribusiness, but its top line growth mainlycomes from
non tobacco business and agro business. ITC is facing pressure on
its consolidating operating margin due to continued losses by its non-
cigarette FMCG business and decline in the profitability for paper and
paper board business. Higheradvertising expanses, which grew 35% in
FY07 and freight cost, which were up 31% lastyear, have also affected
the margins. Going forward, the focus will be on the performanceof its
non tobacco FMCG business, which has begin to show sign of turning
around.

ITC’s top line and bottom-line growth is likely to be marginally affected

looking at itsaggressive investment in hotel and other FMCG business.
Its recent foray in to home and personal care also need immediate
investment. At the current market price of Rs.180, the stock is valued at
around 20.5 times its FY08estimated earning per share of Rs.9. this is
significantly lower than its historical price toearnings multiple of
around 25 and also lower than its peers in FMCG sectors. This provides
20-25% upside over the next 12-18 months.

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SWOT Analysis of ITC Ltd.

Strengths Weaknesses
Brand Dependence on Tobacco Revenues
Distribution Network Negative Connection of Tobacco
Management

Opportunities

Threats
Rural Market Competition both domestic and
e-choupal Internationali
Low per Capita consumption increasing Tax on Cigarettes
personal

care products

Market stand of ITC Ltd.

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FUTURE PLAN OF THE COMPANY :-
Today, the Aashirvaad brand stands foratta and salt and is expected to
add suji, spicesand rice in the staples segment. In the ready-to-eat
segment, Aashirvaad has been expanding the range and the latest
offering includes its combo packs of rice and gravies. Besides, an all-
purpose curry paste has also been included in the range. To make
asuccess of any foods business,apart from understanding the palate, it
would be procurement and sourcing which have to deliver on two
fronts: mainly that of quality and efficiency. As for its ready to eat
category Kitchens of India (KOI), the company’s strategy is toexpand
the KOI product porfolio. In this category, the company plans to
introduce new products to meet the evolving needs of consumers. This
premium brand is targeted attourists, consumers who order at home,
NRIs and women in the age group 25 plus.

Recommendations :-
R According to the survey conducted and after analyzing the Price,
Promotion, Place andProduct of the ITC and the consumer behavior in
the market the company can implementthe following measure for
increasing the sales and volume of their products.

Advertisement for the Aashirvaad atta is found to be ineffective and infrequent. So,the
company can come up with an aggressive advertisement to attract the Indianhousewife
as they are found to be the decision maker in the buying of Atta.

The company can come up the concept of forming a Retail chain of Food productsacross
all over India as it is follows the marketing strategy of Umbrella branding.In such retail
chains all the food division products can be sold at the discountedrate, as more and
more products are coming under the Umbrella products likefood processing.

The branded atta can be exported to other countries where we are currentlyexporting
the whole wheat.

The company can approach the government or distributing their products inMilitary
canteens and can sell them to organization that provides the afternoonmeals to the
children as a part of mid-day meal scheme.

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Limitations :-

• Skill Set Shortage

• Maintaining high quality standards

• Lack of talent pool
• Unable to do primary research

• Confidentiality

• Enhanced risk management

• Time constraint

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References taken :-

http://www.itcportal.com
http://www.google.co.in/
http://www.blonnet.com

http://www.just-food.com
http://www.thehindubusinessline.com
http://www.imcri.org
http://www.scribd.com

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