Summer Internship Project On

A Study Of Equity Research of Company with Special

Reference to ITC Ltd.

submitted for the partial fulfillment of the requirement of the degree

of
POST GRADUATE DIPLOMA IN MANAGEMENT
(PGDM)

Approved by

All India Council of Technical Education (AICTE)

Submitted by
(PradnyaDhulap)
Roll No. 23
Specialization: Finance

Submitted To

SASMIRA’S BUSINESS SCHOOL (SBS)

SARSMIRA MARG, WORLI, MUMBAI.

JULY, 2021
DECLARATION BY THE CANDIDATE

I _______________________________________________________________
(name of the
student) hereby certify that the work which is being presented in this Summer
Internship Project
Report entitled-
“______________________________________________________” in partial
fulfillment of the requirement for the award of the Degree of Post Graduate
Diploma In
Management and submitted to the Sasmira’s Business School, Sasmira Marg,
Worli, Mumbai, is
an authentic record of my own work carried out during a period from 3rd May,
2021 till 30th June,
2021at ________________________________________(name of the
organization) under the
guidance of ____________________________________(Name and
Designation of Faculty
Mentor).

The matter presented in this project report has not been submitted by me for the
award of any other
degree of this or any other Institute.
Wherever references have been made to intellectual properties of any individual
/ Institution /
Government / Private / Public Bodies / Universities, research paper, text books,
reference books,
research monographs, archives of newspapers, corporate, individuals, business /
Government and
any other source of intellectual properties viz., speeches, quotations, conference
proceedings,
extracts from the website, working paper, seminal work et al, they have been
clearly indicated,
duly acknowledged and included in the Bibliography.
Name of the Student:
Signature of the Student:
This is to certify that the above statement made by the candidate is correct to the
best of our knowledge.

Signature of Supervisor: _________________

Name of Supervisor:_____________________

CERTIFICATE

This is to certify that Mr. / Ms.

_________________________________________________
is a bonafide student of the two year full-time Post Graduate Diploma in
Management (PGDM),
(Finance / Marketing / Human Resource ), Roll No. ___________of the
institute.

As a part of the All India Council of Technology (AICTE) guidelines, the

student has carried out
the Summer Internship
Project____________________________________________________
(Title of the Project) at
_________________________________________________________
(Name of the Organization) during the period from ______________________
to
_______________ under my guidance in partial fulfillment of requirement for
the completion
PGDM as prescribed by the All India Council of Technical Education (AICTE).
This Summer Internship Project Report is the record of authentic work carried
out by him / her
during the period from May 2021 to June 2021.

Name & Signature of Name & Signature of Name & Signature of

(Faculty Supervisor) (Dean) (Director)

Place:
Date:
 EXECUTIVE SUMMARY

iTC Ltd is one of Indias foremost private sector companies. ITC has a
diversified presence in Cigarettes, Hotels, Paperboards & Specialty
Papers, Packaging, Agri-Business, Packaged Foods & Confectionery,
Information Technology, Branded Apparel, Personal Care, Stationery,
Safety Matches and other FMCG products. While ITC is an
outstanding market leader in its traditional businesses of Cigarettes,
Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly
gaining market share even in its nascent businesses of Packaged
Foods & Confectionery, Branded Apparel, Personal Care and
Stationery.ITCs wholly owned Information Technology subsidiary,
ITC Infotech India Ltd, provides IT services and solutions to leading
global customers. ITC Infotech has carved a niche for itself by
addressing customer challenges through innovative IT solutions. ITCs
production facilities and hotels have won numerous national and
international awards for quality, productivity, safety and environment
management systems. ITC was the first company in India to
voluntarily seek a corporate governance rating.ITC was incorporated
on August 24, 1910 under the name Imperial Tobacco Company of
India Ltd. As the companys ownership progressively Indianised, the
name of the company was changed from Imperial Tobacco Company
of India Ltd to India Tobacco Company Ltd in the year 1970 and then
to I.T.C. Ltd in the year 1974. In recognition of the companys multi-
business portfolio encompassing a wide range of businesses -
Cigarettes & Tobacco, Hotels, Information Technology, Packaging,
Paperboards & Specialty Papers, Agri-business, Foods, Lifestyle
Retailing, Education & Stationery and Personal Care - the full stops in
the companys name were removed effective September 18, 2001.
 ACKNOWLEDGEMENT

Experience is the best teacher. Knowledge is one of the most important tools.
Only theoretical knowledge is not exactly applicable in practical life, from this
point of view industrial training is important & necessary for a management
students. Theoritical knowledge is proved right only often it is rightly applicable
on practical base.

I also thankful to ITC LTD Manager for providing valuable

information guidance & consist co-operation through out the training
programmed.

I am also thankful to Dr.Sanskruti kadam Dean of Sasmira and

Mr. KamalTandan Director of our Sasmira business school and special
thankful to Miss. Rupali Moremy project guide, for giving me an excellent and
invaluable guidance during the summer internship project.

Miss. PradnyaDhulap
 CONTENTS

Chapter Details Page

No. No.
1 INTRODUCTION
1.1 Background
1.2 Need and Significance of the Study
1.3 Nature and Scope for the Study
1.4 Research Problem
1.5 Research Question
1.6 Aims and Objectives of Study
1.7 About the Company
1.8 Scheme of Chapters

2 LITERATURE REVIEW
2.1 About the Industry
2.2 Review of Opportunities and Challenges in the
Industry
2.3 Literature review related to your topic

CHAPTER 1
INTRODUCTION

Equity Research
Equity research professionals are responsible for producing analyses,
recommendations, and reports on investment opportunities that investment
banks, institution, or their clients may be interested in. The equity Research
Division is a group of analysts and associates at an investment banking (sell-
side), an institution (buy-side), or an independent organization.
 The main purpose of equity research is to provide investors with detailed
financial analysis and recommendations on whether to buy, hold, or sell a
particular investment. Banks often use equity research as a way of “supporting”
their investment banking and sales & trading clients, by providing timely, high-
quality information and analysis.

What is equity research ?

Equity research is the study of a business and its environment in
order to make a buy or sell decision about investing in its shares. This
research can also be applied by an acquirer to a prospective acquisition deal,
to determine the price at which to bid for the securities of a target company.
Equity research can delve into many areas, but tends to concentrate on the
following topics:
• Financial analysis. Calculate the various ratios associated with a company's
financial statements and compare them on a trend line to determine the
financial condition, financial results, and cash flows of the business. These
results can also be compared to industry averages.
• Disclosures. Examine the disclosures that accompany the financial
statements to see if there are any issues that could impact the future value of
the company's equity.
• Industryanalysis. Review the key leading indicators that may predict future
conditions within the industry where the target company operates, as well as
the impacts of changes in the legal, regulatory, and competitive environment
on that industry.
• Projections. Combine the information in the company's financial statements
with the projections and information gleaned from the industry analysis to
arrive at projections for the next few years. This may involve modeling a
variety of scenarios to see how they impact the company and the value of its
shares.

EQUITY RESEARCH ORGANISATION STRUCTURE

Background
ITC Limited

ITC was incorporated in 1910 under the name of Imperial Tobacco Company of
India Limited (later changed to ITC Limited in 1974). It was initially in the
cigarette and tobacco business and later diversified into multiple businesses
including hotels, paperboards and speciality papers, packaging, agri-business,
packaged foods and confectionery, branded apparel, greeting cards and other
FMCG products.
The company entered the hospitality business in 1975. In 1979 it entered the
paperboards business by promoting ITC Bhadrachalam Paperboards Limited,
which was later amalgamated with ITC. In 1992, leveraging its agri-sourcing
competency, ITC set up the International Business Division for export of
agricommodities. More new lines of businesses have followed since 2001 in the
space of FMCG. The company’s products are manufactured at multiple
production facilities across the country. Certain initiatives of the company such
as the ITC eChoupal, ITC ChoupalSaagar and the ITC social farm forestry
programme have been recognised through internationally acclaimed awards for
their impact on rural life.
ITC's diversified status originates from its corporate strategy aimed at creating
multiple drivers of growth, anchored on its core competencies of strong
distribution reach, superior brand-building capabilities, effective supply chain
management and service skills in hoteliering. Its distribution reach is one of the
largest in India – the FMCG business has a retail network over 2 million
retailers in the country, ranging from premium outlets in the metros to small
shops in the interiors of rural India.
Currently British American Tobacco Company (UK) controls 32 per cent equity
stake in ITC. Domestic financial institutions hold 35 per cent share and foreign
institutions have a 15 per cent share. Indian public and corporate bodies hold the
balance 13 per cent stake.
Company Products Established Founder Distribution Production
plants
ITC Cigarettes, 1910 British India, India
foods, American Americas ,
apparel, Tobacco Europe,
stationery, Middle East,
paper Asia Pacific,
Africa

NEED AND SIGNIFICANCE

EQUITY RESEARCH
To start any business capital plays major role. Capital can be acquired in two
ways by issuing shares or bytaking debt from financial institution or
borrowing money from financial institution. The owners of the company
have to pay regular interest and principal amount at the end.

Stock is ownership in a company, with each share of stock

representing a tiny piece of ownership. The more shares you own, the more
of the company you own. The more dividends you earn when the company
makes a profit. In the financial world, ownership is called “Equity”.

• A company can raise more capital than it could borrow.

 • A company does not have to make periodic interest payments to
creditors.
• A company does not have to make principal payments.

Stock /shares play a major role in acquiring capital to the business in return
investors are paid dividends to the shares they own. The more shares you
own the more dividends you receive.

The role of equity analysis is to provide information to the market. An

efficient market relies on information: a lack of information creates
inefficiencies that result in stocks being misrepresented (over or under
valued). This is valuable because it fills information gaps so that each
individual investor does not need to analyze every stock thereby making the
markets more efficient.

ITC Ltd

In those days, rural market is one of the best opportunities in FMCG

sector in Indian market. It is wider and less competitive market for
FMCG. As the income level of rural consumers increasing, the demand of
FMCG products is increasing continuously. The various needs of study
are follows:

• To determine the rising demand of Soaps and Shampoos in rural India

• Know about the different choices of rural consumers
• Rural consumer’s usage habits are deferent to urban
• Rural consumer’s buying behaviour.

Nature and Scope

Equity Research

• The main aim of equity research is to analyze the market trend and
observe how it is affecting companies’ earnings and their stock value.
• It focuses on a particular stock or a sector as a whole and captures all the
information of the stock (or companies in a sector).
 • It includes a review of its historical financial performance, forecast of its
future financial performance along with supporting arguments for the
estimates and finally a recommendation whether to buy or sell the stock.
• Sell-side firms usually produce such detailed reports.

ITC Ltd.

With the population of 1 bn people, India is a big market for FMCG companies.
Around 70% of total household in India reside in rural area. Total number of
rural household is expected to rise from 135m in 2002 to 153m 2010, which
represents largest potential market in the world.

(Rural and Urban potential)

Urban Rural

Population 2001-02(m household) 53 135

Population 2001-02(m household) 69 153

% distribution (2001-02) 28 72

Market ( Towns/ Villages) 3768 627000

Source :statical outline of India (2001-02), NCAER

An average Indian spends 40% of his income on groceries and 8% on personal

care products. A larger part of total spending pie along with large base (
population ) makes India largest FMCG market.

RESEARCH PROBLEMS
ITC Ltd.

• The cigarette industry in India continues to be impacted by a

discriminatory taxation and regulatory policy framework. The steep
increase in the tax rates on cigarettes, both at the Central and at the State
level, has led to the undesirable consequence of shifting consumption to
 lightly taxed (bidis etc) or tax evaded tobacco products, which constitute
as much as 85% of the total tobacco consumption.

• The domestic legal cigarette industry is faced with the growing menace of
illegal cigarettes. Independent research indicates that, in India, whilst
there is a fall in volumes of ‘duty paid’ cigarettes by 4.4% during the
period 2005 to 2010, the ‘duty-not-paid’ volumes grew by 49.3% during
the same period.

• India has now been recognised as one of the leading destinations for
illegal cigarettes. Attractive tax arbitrage opportunities, as a result of the
high level of taxes on the legal domestic cigarette industry in India,
incentivises illegal flow of cigarettes into the Country.

• Another dangerous outcome of the increasing volume of illicit trade is

that it encourages the entry of organised criminal syndicates, which can
have serious law and order consequences for the country.

AIMS & OBJECTIVES

Equity Research

• The main objective of equity research is to study companies, analyze

financials, and look at quantitative and qualitative aspects mainly for
decisions: whether to invest or not.
• Suggestion and comments for holdings sell or buy position can be given
to stockholders.
• Equity Research Report adds significant credibility to portfolio.
• It helps to predict value of the certain equity under the specific
circumstances.
• It is analyzing stock, its industry and its peer group to provide earnings
and valuation estimates.
• Research is valuable because it fills information gaps so that each
individual investors does not need to analyze every stock. This division of
labour makes the market more efficient
ITC Ltd.

The primary focus of ITC's Social Development Initiatives is to create sustainable

sources of farm and off-farm livelihoods and to improve the social infrastructure
especially in areas where it impacts women and children. In pursuit of these
objectives, the following goals have been set for the next five years:

• Web-enable 10 million farmers through 20,000 e-Choupals in 100,000

villages.
• Bring at least 50,000 hectares under soil and moisture conservation
practices.
• Transform at least 1,00,000 hectares of wastelands into productive and
revenue-generating assets for the poor.
• Create at least 10,000 women entrepreneurs with a sustainable source of
supplementary incomes.
• Improve the genetic stock of at least 150,000 cattle through artificial
insemination practices.
• Provide supplementary education support services to at least 100,000
children.

In its endeavour to preserve India's cultural and artistic heritage, ITC will also
continue to ensure that its initiatives in the areas of preservation and promotion
of Indian music, art and theatre are strengthened.

ABOUT THE COMPANY

ITC Ltd.

ITC Ltd is one of India's foremost private sector companies. ITC has a
diversified presence in Cigarettes Hotels Paperboards & Specialty Papers
Packaging Agri-Business Packaged Foods & Confectionery Information
Technology Branded Apparel Personal Care Stationery Safety Matches and
other FMCG products. While ITC is an outstanding market leader in its
traditional businesses of Cigarettes Hotels Paperboards Packaging and Agri-
Exports it is rapidly gaining market share even in its nascent businesses of
Packaged Foods & Confectionery Branded Apparel Personal Care and
Stationery.
ITC's wholly owned Information Technology subsidiary ITC Infotech India Ltd
provides IT services and solutions to leading global customers. ITC Infotech has
carved a niche for itself by addressing customer challenges through innovative
IT solutions. ITC's production facilities and hotels have won numerous national
and international awards for quality productivity safety and environment
management systems. ITC was the first company in India to voluntarily seek a
corporate governance rating.

ITC was incorporated on August 24 1910 under the name Imperial Tobacco
Company of India Ltd. As the company's ownership progressively Indianised
the name of the company was changed from Imperial Tobacco Company of
India Ltd to India Tobacco Company Ltd in the year 1970 and then to I.T.C. Ltd
in the year 1974. In recognition of the company's multi-business portfolio
encompassing a wide range of businesses - Cigarettes & Tobacco Hotels
Information Technology Packaging Paperboards & Specialty Papers Agri-
business Foods Lifestyle Retailing Education & Stationery and Personal Care -
the full stops in the company's name were removed effective September 18
2001.

The company now stands rechristened ITC Ltd.During the year first six decades
of the company's existence were primarily devoted to the growth and
consolidation of the Cigarettes and Leaf Tobacco businesses the seventies
witnessed the beginnings of a corporate transformation that would usher in
momentous changes in the life of the company. In the year 1925 the company
set up Packaging & Printing business as a strategic backward integration for
ITC's Cigarettes business. It is today India's most sophisticated packaging
house.In the year 1975 the company launched its Hotels business with the
acquisition of a hotel in Chennai which was rechristened 'ITC-Welcomgroup
Hotel Chola'.

In the year 1979 they entered the Paperboards business by promoting ITC
Bhadrachalam Paperboards Ltd which today has become the market leader in
India. In the year 1985 the company set up Surya Tobacco Co. in Nepal as an
Indo-Nepal and British joint venture. In the year 1990 the company acquired
Tribeni Tissues Ltd a Specialty paper manufacturing company and a major
supplier of tissue paper to the cigarette industry. The merged entity was named
the Tribeni Tissues Division (TTD).

In the year 1990 the company set up the Agri Business Division for export of
agri-commodities. Today the Division is one of India's largest exporters. In the
year 2000 the company spun off its information technology business into a
wholly owned subsidiary ITC Infotech India Ltd to more aggressively pursue
emerging opportunities in this area. Also the company forayed into the Greeting
Gifting and Stationery products business with the launch of Expressions range
of greeting cards. A line of premium range of notebooks under brand
'Paperkraft' was launched in 2002. To augment its offering and to reach a wider
student population the popular range of notebooks was launched under brand
'Classmate' in the year 2003.

The company also entered the Lifestyle Retailing business with the Wills Sport
range of international quality relaxed wear for men and women in the year
2000. The Wills Lifestyle chain of exclusive stores later expanded its range to
include Wills Classic formal wear (2002) and Wills Clublife evening wear
(2003). ITC also initiated a foray into the popular segment with its men's wear
brand John Players in 2002.

The company forayed into the Foods business to create a new driver of business
growth. It began in August 2001 with the introduction of 'Kitchens of India'
ready-to-eat Indian gourmet dishes. In 2002 the company entered the
confectionery and staples segments with the launch of the brands mint-o and
Candyman confectionery and Aashirvaad atta (wheat flour). Also the company's
philosophy of contributing to enhancing the competitiveness of the entire value
chain found yet another expression in the Safety Matches initiative.

ITC now markets popular safety matches brands like iKnoMangaldeep Aim
Aim Mega and Aim Metro. Bhadrachalam Paperboards Ltd amalgamated with
the company effective March 13 2002 and became a division of the company
Bhadrachalam Paperboards Division. In November 2002 this division merged
with the company's Tribeni Tissues Division to form the Paperboards &
Specialty Papers division. In August 2002 Surya Tobacco became a subsidiary
of ITC Ltd and its name was changed to Surya Nepal Pvt Ltd (Surya Nepal).In
the year 2003 the company entered the biscuits segment with the introduction of
Sunfeast. Also the company forayed into the marketing of Agarbattis (incense
sticks) in partnership with the cottage sector.

The company's popular agarbattis brands include Spriha and Mangaldeep across
a range of fragrances like Rose Jasmine Bouquet Sandalwood Madhur Sambrani
and Nagchampa. In the year 2004 the company acquired the paperboard
manufacturing facility of BILT Industrial Packaging Co Ltd (BIPCO) near
Coimbatore Tamil Nadu. In July 2005 the company introduced Essenza Di
Wills an exclusive range of fine fragrances and bath & body care products for
men and women. Inizio the signature range under Essenza Di Wills provides a
comprehensive grooming regimen with distinct lines for men (Inizio Homme)
and women (Inizio Femme).

In the year 2007 the company entered the fast growing branded snacks category
with 'Bingo!'.The company launched 'Fiama Di Wills' a premium range of
Shampoos Shower Gels and Soaps in September October and December 2007
respectively. The company also launched the 'Superia' range of Soaps and
Shampoos in the mass-market segment at select markets in October 2007 and
Vivel De Wills &Vivel range of soaps in February and Vivel range of shampoos
in June 2008. In the year 2008 the company repositioned the business as the
Education and Stationery Products Business and launched India's first
environment friendly premium business paper under the 'Paperkraft' Brand.
Paperkraft entered new categories in the office consumable segment with the
launch of Textliners Permanent Ink Markers and White Board Markers in 2009.
During the year 2009-10 the company launched new variants of 'Gold Flake'
and 'Navy Cut Filter Kings' with innovative product features limited edition
packs of 'Classic' and launch of new brands like 'Flake Excel Filter' and 'Duke
Filter'.

The company also launched its premium line of hand-rolled cigars in select
markets under the brand name 'Armenteros'. During the year the company
launched 'mint-o GOL' in the 'chews' category. In the Agarbattis the company
launched a new variant 'Fragrance of Temple' in Tamil Nadu under the
'Mangaldeep' brand which delivers temple aroma. In the personal care segment
the company launched 'Fiama Di Wills' Gel Bathing Bar. Also they
strengthened the brand 'Vivel' with the launch of the 'Milk Cream & Glycerine'
bathing bar in the winter care segment and 'Deo Spirit' in the freshness
segment.In October 2009 the company launched the ITC Royal Gardenia a 292
room luxury offering in Bengaluru.

It is the largest LEED (Leadership in Energy and Environmental Design)

Platinum rated hotel in the world and the first in Asia to achieve this
distinction.In the year 2011 ITC Limited proposed invest up to Rs 3000 crore to
set up a paper manufacturing unit in Andhra Pradesh as part of its plans to
double capacity over the next five years. ITC also entered into lifestyle retailing
and the stationery segments through its premium brands Paperkraft notebooks
and Wills Sport apparel range. Eventually the company launched mass-appeal
brands like Classmate:notebooks and John Players:menswear.

ITC opened first premium cigar retail store in Delhi. ITC Ltd also acquired the
entire shareholding of Russell Credit Ltd. (wholly owned subsidiary of the
Company) in Wimco Ltd. (Wimco) (i.e. 96.825% of Wimco's equity share
capital). ConsequentlyWimco became a direct subsidiary of the Company with
effect from September 29 2011. In 2012 ITC Ltd acquired 22606065 Ordinary
Shares having no par value of Technico Pty Ltd (TPL) a company incorporated
in Australia from Russell Credit Ltd wholly owned subsidiary of the Company.
Consequently TPL became a wholly owned Subsidiary of the Company with
effect from March 26 2012.

In 2013 ITC Ltd has launched a social investment project Mission Sunehrakal
(MSK) in Mysore district to conserve soil and moisture. ITC also forayed into
the biscuits market with its Sunfeast range of glucose marie and cream biscuits.
ITC Infotech becomes the 1st PTC Authorized Training Partner in India. ITC
Hotels tied up with RP Group Hotels & Resorts to manage 5 hotels in India and
Dubai. ITC's leading personal care brand announced the launch of its second
edition of the signature series of the Couture Spa Range of Gel Bathing Bars.

ITC's leading personal care brand also announced the launch of its unique Skin
Nourishing Range of Soaps - VivelIn 2014 ITC has been voted among the top
two 'Buzziest Brands' in the 'Corporate' category by 'afaqs' one of the world's
largest marketing and advertising portals. ITC's leading personal care brand and
one of India's most exciting brands introduced Love & Nourish'. ITC becomes
fastest firm to clock Rs 1000 cr revenue in stationery market. ITC's Engage
range takes second spot in deo market by volume. ITC also replaces TCS as
India's most admired company.

ITC enters e-cigarette business. ITC Hotels launches one of largest ever foreign
investments in ColomboIn 2015 ITC's paper boards and specialty papers
division introduced grease-resistant paper boards. ITC acquired 87.06% equity
share capital of Classic Infrastructure & Development Ltd. Russell Credit Ltd. a
Wholly Owned subsidiary of the Company has acquired the entire equity share
of Wills Corporation Ltd. (Wills).

ITC also Launches Vivel Ayurveda Essence in Kerala. On 13 February 2015

ITC announced that the company has entered into Asset Purchase Agreements
with M/s. Johnson & Johnson Ltd. India & M/s. Johnson & Johnson Pte. Ltd.
Singapore for purchase of Savlon' and Shower To Shower' trademarks and other
intellectual property respectively primarily for use in India. On 23 February
2015 ITC announced that the company has been declared as the
highest/successful bidder for Park Hyatt Hotel located at 263-C
ArossimCansaulim Goa along with land and built up area of the hotel together
with all buildings and structures and plant & machineries.
This property of M/s. Blue Coast Hotels Ltd. was put up on sale by IFCI Ltd.
through public auction under the provisions of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest Act
2002.On 24 March 2016 ITC announced that it has acquired the entire equity
share capital of Technico Agri Sciences Limited India from Technico Pty
Limited Australia for a total consideration of Rs 121 crore. The acquisition is a
related party transaction between ITC and Technico Pty Limited a wholly
owned subsidiary of ITC.

Technico Agri Sciences Limited is in the agricultural bio-technology business

primarily of growing and selling of Technituber seed potatoes and field
generated seed potatoes. On 2 April 2016 ITC announced that the company has
been compelled to shut its cigarette factories with effect from 1 April 2016 until
clarity emerges in the uncertain state of the rules on health warning on cigarette
packs. On 5 May 2016 ITC announced that the Supreme Court on 4 May 2016
passed an order transferring to the Karnataka High Court all writ petitions
pending in various courts challenging the rules prescribing 85% pictorial
warnings on packages of tobacco products.

The Supreme Court observed that all parties should endeavour to follow the
rules. On 8 May 2016 ITC announced that its cigarette factories are
commencing production progressively.ITC's Board of Directors at its meeting
held on 20 May 2016 recommended issue of bonus shares in the ratio of 1:2. On
9 October 2016 ITC announced divestment of its entire shareholding in its
wholly owned subsidiary King Maker Marketing Inc. USA along with
assignment of certain trademarks owned by the company for total consideration
of US$24 million.

The company allotted 4026657100 Ordinary Shares of Re 1/- each fully paid-up
were issued and allotted as Bonus Shares in the proportion of 1 (One) Bonus
Share of Re 1/- each for every existing 2 (Two) fully paid-up Ordinary Shares
of Re 1/- each held on 04 July 2016 being the Record Date determined by the
Board for the purpose. The Bonus Shares were allotted on 07 July 2016.

During the year the company divested the entire equity shareholding in King
Maker Marketing Inc. (KMM) New Jersey USA. Consequently effective 16
November 2016 KMM ceased to be a subsidiary of the company.Pursuant to
Pyxis Inc. merger with ITC Infotech (USA) Inc. with effect from 1st April 2016
Pyxis has ceased to be a subsidiary of ITC Infotech India Limited and that of
ITC Limited with effect from that date. During the year ITC Infotech (USA)
Inc. a wholly-owned subsidiary of ITC Infotech India Limited subscribed to the
entire share capital of Indivate Inc.

A company incorporated in USA. ConsequentlyIndivate Inc. became a wholly-

owned subsidiary of ITC Infotech Inc. USA with effect from 18 November
2016.As on 31 March 2017 the company has 24 subsidiaries including 9
subsidiaries outside India. ITC has won the prestigious Porter Prize 2017 for
Excellence in Corporate Governance and Integration' and for its exemplary
contribution in Creating Shared Value'. ITC Limited became the 1st company to
win the India Today Safaigiri Corporate Trailblazor Award 2016.

ITC Limited won two 'ASSOCHAM Waste Management Excellence Awards

2017' in the Best Corporate Initiative in Swachh Bharat Abhiyan' and Best
Outreach Strategy in Waste Management' categories. ITC won the Intel AIM
Corporate Responsibility Award 2016 accorded by the Asian Institute of
Management-RVR CSR Center and the Asia Inc Forum. ITC was adjudged the
Best in Supply Chain Sustainability' at the Asian Corporate Sustainability
Summit 2016. ITC's Paperboards Unit in Bhadrachalam has become the first
integrated Pulp and Paper Unit to receive the prestigious CII GreenCo Platinum
Rating.

During 2018 ITC won the Best Practices Award' from United Nations Global
Compact Network India for two major game-changing initiatives of the
Company - Integrated Watershed Development and Social & Farm Forestry.
ITC's leading hygiene brand Savlon bagged 7 awards at the coveted Cannes
Lions 2017. ITC Hotels Division was conferred the 2017 Greenbuild
Leadership Award' by the U.S. Green Building Council (USGBC). ITC was
conferred the coveted National Award for Excellence in Employee Relations
2017 by the Employers' Federation of India (EFI).

ITC was adjudged for Best In-house Legal Team of the Year Award by Legal
Era Magazine at the Indian Legal Awards 2017-18. During 2018-19 ITC
launched over 50 new FMCG products across categories such as Foods Personal
Care Education and Stationery products Agarbatti and Matches strengthening its
diverse and differentiated portfolio of FMCG offerings. On 10 July 2018 ITC
Global Holdings Pte. Limited Singapore (Global') a subsidiary of the company
which had been under winding up was dissolved vide the Order of the High
Court of the Republic of Singapore.

Consequently Global ceased to be a subsidiary of ITC Ltd.ITC's leading

hygiene brand Savlon became the first Indian brand to win the Grand Prix for
Creative Effectiveness' at the coveted Cannes Lions 2018. ITC received the
Diamond Award for Excellence in Public Relations' (ITC Aashirvaad) and Gold
Award in the consumer products category' (ITC Classmate) at the SABRE
Awards South Asia 2018.

The company adjudged as the Best In-house Legal Team of the Year Award
from Legal Era Magazine at the Indian Legal Awards 2018-19. ITC's
Paperboards Business was recognised as the Best Performer in the pulp & paper
sector by the Bureau of Energy Efficiency under the Perform Achieve and
Trade Scheme. The company bagged the First prize in 6 categories at the Public
Relation Society of India (PRSI) National Awards 2018.

During the FY2020 despite the COVID lockdown ITC launched a bouquet of
specially crafted innovative products with agility and speed to cater to the
consumers' urgent needs for health wellness and hygiene solutions. In the
FY2020 the company has launched more than 60 new products.ITC won the
Best Corporate Initiative in Sanitation Award' at the India Sanitation Coalition -
FICCI Sanitation Awards 2019. The company won the First Prize in 5
categories at the Public Relations Society of India (PRSI) National Awards
2019.

ITC Haridwar Unit won the Outstanding Performance in Food Safety

Excellence Award' in the Large Manufacturing Food Business Bakery category
at the CII Award for Food Safety 2019. ITC received the CII National HR
Excellence Award' for Significant Achievement in HR Excellence. ITC Kovai
Unit received the Platinum-level certification the highest recognition for water
stewardship in the world based on international benchmarks from the Alliance
for Water Stewardship Scotland.

The amalgamation of Sunrise Foods Private Limited and its subsidiaries with
the Company was approved by the Board of Directors on 04 September 2020.
The necessary petitions seeking sanction of the National Company Law
Tribunal to the said amalgamation have been filed.As on 31 December 2020 the
company has 28 subsidiaries 4 joint venture and 7 associate companies under its
roof.

MILESTONES
 ITC Ltd.
• ITC was incorporated on August 24, 1910 under the name of 'Imperial
Tobacco Company of India Limited'
• In 1975 through its acquisition of a hotel in Chennai , the company launched
its hotel business by the name 'ITC–Welcomgroup Hotel Chola'.
• In 1979 it entered into manufacturing paperboards, packaging & printing
business.
• In 1985 it set up Surya Tobacco Co. in Nepal, now a subsidiary of ITC.
• In 1990 ITC set up the Agri Business Division for export of agri–commodities
based on partnership with farmers, for revolutionizing the rural agricultural
sector.
• In 2000, ITC launched a line of greeting cards under the brand name
‘Expressions’. There has been further extension in productline with
introduction of gift wrappers, autograph books slam books and stationery.
• In 2000, it entered in lifestyle retailing business with the Wills Sport, a range
of international quality wear for men and women.
• ITC InfoTech India was set up in 2000 to provide outsourcing solutions to
manufacturing, BFSI (Banking, Financial Services & Insurance), CPG&R
(Consumer Packaged Goods & Retail), THT (Travel, Hospitality and
Transportation) and media & entertainment.
• ITC entered food business in 2001, its product line in this segment consist
of brands 'Kitchens of India', ‘Aashirvaad atta’, ‘Candyman’, ‘Sunfeast’ &
‘Bingo!’.
• In 2002 it entered in marketing of matches, ITC now markets popular safety
matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.
• In 2003 ITC's forayed into the marketing of Agarbattis (incense sticks),
creating brands like Mangaldeep, Spriha, Aim Metro and so on.
• ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and
bath & body care products for men and women in July 2005.
• The Company also launched the 'Superia' range of Soaps and Shampoos in the
mass–market segment at select markets in October 2007 and Vivel De Wills
&Vivel range of soaps in February and Vivel range of shampoos in June
2008.
• In 2013– ITC Hotels tied up with RP Group Hotels & Resorts to manage
5 hotels in India and Dubai, under ITC Hotels’ 5–star ‘WelcomHotel’ brand
and the group’s mid–market to upscale ‘Fortune’ brand

BOARD & MISSION

ITC Ltd.
 • To enhance the wealth generating capability of the enterprise in a
globalising environment, delivering superior and sustainable stakeholder
value.
• ITC's vision, according to CEO and Executive Director Chairman Sanjiv
Puri, is to gain 1 Lakh crores from FMCG division by the year 2030.
• ITC will also invest 80% of its capital in the non-tobacco FMCG division
of the company. In the year 2018 itself, ITC has put 30+ new products
into the market, including frozen snacks and other consumer products.

PRODUCTION OF THE ORGANIZATION

ORGANISATION STRUCTURE

Office of the Executive Director

The Office of the Executive Director (OED) provides strategic leadership for
the development and management of ITC. OED is responsible for
determining ITC’s strategic direction within the context of the 2030 Agenda for
Sustainable Development and the global Aid for Trade arena. It ensures that
appropriate policy and accountability mechanisms are in place, and secures
resources to implement the strategy and expand the influence of ITC by raising
awareness around its mission and key messages among stakeholders and the
general public.

Division of Enterprises and Institutions

The Division of Enterprises and Institutions (DEI) works to connect MSMEs to
international value chains, strengthen trade and investment support institutions,
and promote and mainstream inclusive and green trade. DEI focuses on
innovative and inclusive market-driven approaches to strengthen the
international competitiveness of MSMEs from developing countries and
economies in transition.

Division of Country Programmes

The Division of Country Programmes (DCP) ensures country ownership,
coherence and impact of ITC’s Aid for Trade offering across 153 programme
countries and regions. DCP comprises five dedicated regional offices and ITC’s
Project Design Taskforce. DCP ensures strategic client-relationship
management and coordination of ITC’s technical assistance at the national and
regional levels with key public and private sector stakeholders
Division of Market Development
The Division of Market Development (DMD) provides thought leadership on
MSME competitiveness, delivers competitive intelligence services, and
supports governments in the design and implementation of trade development
strategies. DMD provides supports to enterprises and business associations to
provide a business perspective in the formulation of trade strategies and reform
of policies and regulations at national and regional levels. The division
promotes an inclusive public-private dialogue to address obstacles to
international trade an investment and to provide customised solutions to remove
them.

Division of Programme Support

The Division of Programme Support (DPS) is responsible for assisting the
programme management of ITC in ensuring the efficient and effective
management and utilization of human, financial, IT and other resources required
to implement the ITC programme of work. DPS manages the administrative,
legal and logistical support required by ITC.
 CHAPTER 2-

Literature Review

About The Industry

ITC Ltd.
ITC Ltd (NSE:ITC) is one of India's foremost private sector companies and a
diversified conglomerate with businesses spanning Fast Moving Consumer
Goods, Hotels, Paperboards and Packaging, Agri Business and Information
Technology. The Company is acknowledged as one of India's most valuable
business corporations with a Gross sales value of ₹ 76,097.31 crores and Net
Profit of ₹ 15,136.05 crores (as on 31.03.2020). ITC was ranked as India's most
admired company, according to a survey conducted by Fortune India, in
association with Hay Group. 1
ITC is the country's leading FMCG marketer, the clear market leader in the
Indian Paperboard and Packaging industry, a globally acknowledged pioneer in
farmer empowerment through its wide-reaching Agri Business, a pre-eminent
hotel chain in India that is a trailblazer in 'Responsible Luxury'. ITC's wholly-
owned subsidiary, ITC Infotech, is a specialized global digital solutions
provider.
Over the last decade, ITC's new Consumer Goods Businesses have established a
vibrant portfolio of 25 world- class Indian brands that create and retain value in
India. ITC's world class FMCG brands including Aashirvaad, Sunfeast,
Yippee!, Bingo!, B Natural, ITC Master Chef, Fabelle, Sunbean, Fiama,
Engage, Vivel, Savlon, Classmate, Paperkraft, Mangaldeep, Aim and others
have garnered encouraging consumer franchise within a short span of time.
While several of these brands are market leaders in their segments, others are
making appreciable progress.

REVIEW OF OPPORTUNITIES & CHALLENGES IN THE

INDUSTRY

ITC Ltd .

In India, these social and environmental challenges are even more

daunting. Even though India recently displaced Japan to become the world's
third largest economy in terms of Purchasing Power Parity (PPP), a third of the
world's poor still live in India, according to a 2013 UN Report. Global
challenges on the social front assume even greater significance in India which is
home to 17% of the world's population, with only 2.4% of the world's land
share. India is already facing challenges of overpopulation and lack of proper
education as well as a paucity of employment opportunities for the large
population of youth that is now potentially part of India's demographic
dividend. The need of the hour is an enabling policy framework that supports
the expansion of employment opportunities and cognises for the emerging
market dynamics and the socio-economic environment. Of equal concern is
India's continued downward slide on the Human Development Index and
 priority must be provided to reducing child and mother mortality, improving
access to sanitation and quality education and reducing the inequalities of
opportunity to enable people to lead a decent life.

• Agriculture in India engages around 50 per cent of the country's workforce and
supports the livelihoods of 75 per cent of the population living below the
poverty line.
• The sector consumes 80 per cent of the nation's fresh water resources, a quarter
of the total electricity and more than 70 per cent of central government
subsidies.
• However, it accounts for just about 14 per cent of GDP. Woefully therefore, the
farmer's per capita income is less than one-fifth of the rest of the country's
average.
• Such low incomes are a result of a deteriorating natural resource base,
disconnected value chains, fragmented landholdings, weak infrastructure,
inadequate knowledge and multiple intermediaries.

LITERATURE REVIEW
ITC Ltd.

A firm’s international competitiveness (FIC) can be defined as the set of

results of a firm (financial and non-financial) that has activities in foreign
markets, obtained in comparison with other firms that also offer similar
products and services (Lo´pez and Garcı´a, 2005; Toppinen et al., 2007;
Zeng et al., 2008). The firm’s results can be expressed in terms of
international sales (exports), foreign direct investment (FDI), market
share, satisfaction with the achievement of the firm’s goals, and so on.

Currently, the resource-based view (RBV) (Barney, 1996) plays a very

important role in international business management (Fahy, 2002; Hatch
and Dyer, 2004; Lo´pez and Garcı´a, 2005) for the simple reason that it
considers some resources of a firm as sources of competitive advantage
(Barney, 1996; Lo´pez and Garcı´a, 2005). This is because not all firms
have similar resources (i.e. firm size, skills of personnel, technology,
etc.). ITC is a clear example of this. ITC varies greatly in each firm; it
may be better, worse, or simply different (Powell and Dent-Micallef,
1997).
Moreover, ITCs are clearly considered a key element for business growth
in this era of the present century (Okoli et al., 2010). This is especially so
in a dynamic business with a highly competitive environment which
requires the utilizing of advanced ITC to improve its efficiency and cost
effectiveness, and also for offering high quality products and services for
its customers (Mosleh and Shannak, 2009; Powell and Dent-Micallef,
1997). Hence, ITCs have only recently become one of the most important
pillars for the FIC (Flor and Oltra, 2005; Hao-Sung, 2003; Jones and
Crack, 2001).

Various researchers have found empirical evidence of the effects that the
use of ITCs have on the FIC (Eraqi, 2006; Cho et al., 2007; Lo´pez and
Garcı´a, 2005). Thus, MD 50,6 1046 firms that invest in technology show
more international presence in terms of international sales (Eraqi, 2006;
Jones and Crack, 2001; Lee et al., 2008).

On the other hand, there are firms that utilize ITC as a source of
competitive advantage. This is because they have multiple plans and
projects that make them able to adapt and compete in different sectors
and areas (Elenurm, 2007; Jones and Crack, 2001). Flor and Oltra (2005)
have shown that the use of ITC as a source of competitive advantage is
not due to the management department assigned. It occurs because all of
the personnel working in the firm have been implicated.

Concerning international competitiveness, it is currently almost

impossible to speak of ITCs and not mention electronic commerce (e-
commerce), especially in developing countries (Okoli et al., 2010). With
respect to this topic, Drucker (2003) argued that e-commerce represents a
new challenge for international companies. This is because the firms that
are not really prepared to face it just die off, engulfed by this e-
commerce. This requires a different mentality, different team
management, and a new definition of performance. E-commerce not only
overcomes the geographic distances between the buyer and seller, it
simply eliminates them completely (Drucker, 2003). Clear examples of
this are such companies as Amazon or Interflora. In New Zealand, the
latter company sends flowers and plants around the world. But the truth is
that their case is not unique; in fact many more exist (e.g. Sears in the
USA, Inditex in Spain, etc.).
In this line of thinking, people play an important role in a hyper-
competitive environment. The literature reviewed (see Pla-Barber, 2001),
shows us that some relevant characteristics (age, education, fluency in
foreign languages; knowledge of foreign markets; experience in other
countries and cultures, and so forth) concerning the human resources
(HR) of firms help achieve an improvement of the FIC. Hence, the use of
ITC would not be possible if firms did not count on qualified personnel
with international experience, language skills (Jones and Crack, 2001;
Hatch and Dyer, 2004) and other specific characteristics. In this sense, the
combination of technologies and the characteristics of human capital
becomes a competitive advantage when firms utilize this as a marketing
tool. This is because it allows them to establish contact with customers
and clients located in different places around the world (Mosleh and
Shannak, 2009), thus allowing, for example, better international
performance in terms of sales. Abereijo et al. (2009) said that the use of
ITC also lets firms train their human resources when these are abroad.
Therefore, the characteristics of human resources are an important factor
in the effective use of ITC (Jones and Crack, 2001; Powell and Dent-
Micallef, 1997)

It is important to mention that the sector variable is widely used as a

control variable. In this research, however, the sector is studied from the
point of view of the collaboration between companies belonging or
related to similar activities (e.g. textiles, farm business, and chemicals).
Their mere presence only indicates their position within an industrial
group, not the role that they play within the FIC. In this sense, when we
talk about their collaboration, we are referring to the mechanisms that,
one way or another, allow firms to compete more successfully in foreign
markets. This is due to firms needing the support or the assistance of their
sector to grow and compete internationally (Cho et al., 2007; Nadvi,
1999). Enterprises get the maximum benefits from the local environment
of their country of origin when their suppliers’ industries are themselves
global competitors. In this case, the necessary facilitating technology
flows to their customers settled in foreign markets (Hao-Sung, 2003;
Nadvi, 1999)

According to Porter (1998), firms need the collaboration of the industrial

sector to grow and compete internationally, since at this time no company
operates alone (Chen et al., 2009), especially in global markets. In the not
too distant future, competition in international markets will not be
between companies that operate alone, but between groups of firms (e.g.
strategic alliances). In this sense, D’Cruz and Rugman (1992) have shown
that those enterprises that have managed to achieve success in foreign
markets (better performance), do so because they have enabled the
exchange of technologies, knowledge transfer, research and development,
and other activities. These affirmations coincide with studies done by
Toppinen et al. (2007). To summarize up, ITC could be affected in a large
part by the collaboration of the industrial sector (Hao-Sung, 2003; Powell
and Dent-Micallef, 1997). However, from institutional theory (IT), all
firms’ resources are conditioned by the environment in which they have
their commercial operations (Meyer et al., 2009). In this sense, according
to Porter (1998) and Meyer et al. (2009), technologies are also affected by
the environment. This is because in an environment in which ITC do not
exist, their utilization would be impossible (Hao-Sung, 2003; Chen et al.,
2009; Okoli et al., 2010). Hence, the environment is one of the factors
that also condition the use of information technologies, particularly in the
case of firms located in developing countries (Okoli et al., 2010). Hao-
Sung (2003) affirmed that local infrastructures play an important role in
the FIC, especially in developing countries.

Moreover, Jarvenpaa and Leidner (1998) have shown, in a study done in

Mexico, how firms have achieved a competitive advantage in terms of
performance when they efficiently exploit environment factors, despite
the fact that the environment in developing countries is usually chaotic
(i.e. a lack of R&D, inefficient government, a lack of competitive
suppliers). These authors have found that the skills and capabilities of
human resources play a crucial role in this task. This is because only
people with talent, capabilities and knowledge can transform the chaotic
and complex environment of developing countries into a favorable one.
In this line of research, one can find a study carried out in the industrial
surgical steel sector of Pakistan (Nadvi, 1999) that shows how the local
environment of the country of origin of the firms, aids the firm’s success
in international markets. Hence, some firm resources, such as ITC, would
be affected by various environment factors, such as government policy,
the presence of local suppliers with an international presence, R&D
developed by the local centers of research and universities, and so on
(Okoli et al., 2010; Lefebvre et al., 1998). Therefore, the literature
reviews described above allow us to establish the following assumptions

CHAPTER 3
 RESEARCH METHODOLOGY
Introduction to research methodology

The term research refers to search for facts. It is an extensive and careful
investigation of a given phenomenon with the specific goal for enhancing one’s
knowledge level. In short, through scientific and scholarly analysis it conveys
sense of deep and purposeful study.

The methodology spells the meaning itself i.e. method users by the research in
obtaining information.

Research can also be termed as the field of practical and scientific study, where,
in order to better administer the business, the company obtain data and analysis
it. Research includes financial data, consumer feedback and competitive
analysis. The companies where the executives and managers apply research
method are able to understand their business better, the position it holds in the
markets and various ways of enhancing that position.

Research is a practical activity intended to find out things about business matter
in the systematic and logical way. The idea is to advance knowledge and help
manager solve business problems by providing reliable and consistent measure.

Meaning of research

The term ‘research’ has been viewed with mystique by many people. It is seen
to be the preserve of academicians and professional elite. In most people’s the
word ’research’ conjures up the image of a scholar, laboratory work, university
or other ‘academic’ setting. But research is simply the process of asking
questions and answering them by survey or experiment in an organized way. It
should not be confined to academicians alone. Every thinking person has the
capacity and should do research. The fundamental requirement for research is
an enquiring mind in order to recognize that there are questions that need
answers. The quest for knowledge then is the basic idea behind research.

Research Process
• Selecting the research area: you are expected to state that you have
selected the research area due to professional and personal interests in the
area and this statement must be true.
• Formulating research aim: objectives and research questions or
developing hypotheses. The choice between the formulation of research
questions and the development of hypotheses depends on your research
approach as it is discussed further below in more details. Appropriate
research aims and objectives or hypotheses usually result from several
attempts and revisions and these need to be mentioned in methodology
chapter. It is critically important to get your research questions or
hypotheses confirmed by your supervisor before moving forward with the
work.
• Conducting the literature review: it can be mentioned that the literature
has proved to be the longest stage in the research process and that you
have utilized a wide range of secondary data sources such as books,
newspapers, magazines, journals, online articles etc.
• Selecting methods of data collection: Specific data collection method
need to be selected on the basis of critically analyzing advantages and
disadvantages associated with several alternative data collection methods.
 In studies involving primary data collection, in dept discussions of
advantages and disadvantages of selected primary data collection method
need to be included in methodology.
• Collecting the primary data: Primary data collection needs to be
preceded by a great level of preparation and pilot data collection may be
required in case of questionnaires. Primary data collection is not a
compulsory stage for all dissertations and you will skip this stage if you
are conducting a desk- based research.
• Data analysis: Analysis of data plays an important role in the
achievement of research aim and objectives. Data analysis methods vary
between secondary and primary studies, as well as, between qualitative
and quantitative studies. Data analysis is discussed in chapter 6 in great
details.
• Reaching conclusion: Conclusions relate to the level of achievement of
research aims and objectives. In this final part of your dissertation you
will have to justify why you think that research aims and objectives have
been achieved.
• Completing the research: following all of the stages described above,
and organizing separate chapters into one file leads to the completion of
the first draft. The first draft of your dissertation needs to be prepared at
least one month before the submission deadline. This is because you will
need to have sufficient amount of time to address feedback of your
supervisor.

The International Tobacco Control Policy Evaluation Project (the ITC Project)
is an international research collaboration across more than 29 countries -
Canada, United States, United Kingdom, Australia, Thailand,
Malaysia, Republic of Korea, China, Mexico, Uruguay, New Zealand, France,
Germany, the Netherlands, Bhutan, Ireland, Brazil, India, Bangladesh,
Mauritius, Kenya, Zambia, United Arab Emirates, Greece, Hungary, Poland,
Romania, Spain, and Japan. The primary objective of the ITC Project is to
conduct rigorous evaluation of the psychosocial and behavioural effects of
national-level tobacco control policies of the Framework Convention on
Tobacco Control (FCTC). The ITC Project is conducting large-scale prospective
cohort surveys of tobacco use to evaluate FCTC policies.

Each ITC Survey includes key measures for each FCTC policy domain that are
identical or functionally similar across the 29+ countries to facilitate cross-
country comparisons. The evaluation studies conducted from the ITC Surveys
take advantage of natural experiments created when an ITC country implements
a policy: changes in policy relevant variables in that country from pre- to post-
policy survey waves are compared to other ITC countries where that policy has
not changed. This research design provides high levels of internal validity,
allowing more confident judgments regarding the possible causal impact of the
policy.

A longitudinal cohort survey is simply a survey that measures the same

variables across different populations, or countries in the case of ITC, and
retains participants from year-to-year to monitor change in overall attitudes,
knowledge, or behaviour within the population over time.

Research Methods Publications

• The Conceptual Framework of the International Tobacco Control (ITC)

Policy Evaluation Project
• Evaluating the Effectiveness of Smoke-free Policies, IARC Handbook
of Cancer Prevention, Volume 13
• Is web interviewing a good alternative to telephone interviewing?
Findings from the International Tobacco Control (ITC) Netherlands
Survey
• Methods of the International Tobacco Control (ITC) China Survey

Problem Identification
ITC Ltd
The organisation is currently comprised of four separate functions:
administration, production, retail, and customer service. These functions are
spread over a number of sites with administration and production sharing a
single site, retail function operating from several locations, and customer
service spread across three call centres. The problems which are facing the
organisation vary depending on the function and location.

The administration function of head office and the production function of the
factory are both based on the same geographical site. Although the functions are
working in close proximity to each other they are very different in terms of
working conditions, practices, and pay systems. These differences are creating
tensions across the departments and leading to a “them and us” culture. Some of
the differences identified include; bonus scheme in the factory but not the head
office, poorer working conditions in the factory compared to head office, lack of
subsidised canteen for factory staff which is available to administrative staff.
Some problems are common to both functions such as lack of promotion
opportunities for internal candidates and poor general perception of staff
abilities by managers. As well as these, the factory also suffers from a blame
culture apparently fostered by poor product quality.

The retail outlets have a separate set of problems. There is potentially a

discrimination problem in the recruitment and selection processes employed for
managerial staff. There are currently no female managers of retail outlets and
there has been at least one complaint of discrimination referred to a trade union
by an unsuccessful female candidate for promotion. This complaint has received
the backing of a number of the individual’s colleagues.

The call centres are very highly pressured, time-oriented environments in which
to work. There are significant pressures to deal with customer enquiries quickly
and to sell as many new packages as possible. Pressure is exerted by supervisors
whose salaries are dependent on the abilities of the centre staff to generate
income through sales.

Across the organisation there is a general feeling that staff are underpaid in
relation to competitors and not valued as an asset of the organisation. There is
an increasing trend towards trade union membership which is probably a sign of
growing disaffection within the workforce as a whole. There are also a growing
number of customer complaints, mainly directed at retail and customer service
staff as they are the customer-facing part of the organisation. These complaints
are generally centred on lack of knowledge of products on the part of retail staff
and poor customer service from the call centre staff.

As detailed there are a multitude of different problems facing ITC with the lack
of consistency of treatment of staff across the organisation and poor
communication of organisational values being major contributing factors. The
morale of the workforce is low and there is a lack of loyalty to the organisation
demonstrated by high levels of staff turnover. It is not purely a matter of low
salaries as it has been recognised that staff leave the company to work for other
organisations for little in the way of additional reward. The managerial and
supervisory staff also appear to be unable and/or unwilling to tackle the
problems which leaves the staff with no alternative but to seek advice and
assistance from the trade unions. The consultants reported that there is no
inherent problem with the quality of the core workforce but that the managerial
staff are not sufficiently competent to be able to recognise and build on the
attributes of the workforce. This combination of factors and problems could
potentially all be explained within the concept of employee engagement. The
main thrust of this report will, therefore, concentrate on the implementation of
an employee engagement programme as an initial means of addressing the
issues currently facing ITC. Other means of tackling the identified problems
over the longer term will also be discussed and recommendations made.
METHODOLOGY ADOPTED
ITC Ltd.
This study was carried out in a developing country of South America – i.e.
Peru – because this country has shown a great level of economic industrial
growth over the MD 50,6 1048 past three years (a mean rate of 9.9 percent
of GDP growth). We thus studied the SMEs of Peru according to the
classification made by its Ministry of Tourism and Commerce (Mincetur,
2006).
With respect to the unit sample, the questionnaires were answered
by international operations managers. The questionnaire was sent to the top
1,000 SMEs, which make up the population of this study. A total of 103
questionnaires (discounting those that were incomplete) were returned in
different forms – via e-mail, postal mail, online survey (web survey) and
personal interviews with manufacturers (June 2007-May 2009). This
represents a reply rate of 10.3 percent. The low reply rate is explained in
part because many SMEs from developing countries are hesitant to answer
surveys from foreign universities, as has been found in similar studies
carried out in developing countries (e.g. Mesquita and Lazzarini, 2008;
Okoli et al., 2010; Zou et al., 1997). This study was conducted from Spain
and the subjects of study were in Peru. It is very important to highlight that
100 percent of the SMEs were export firms. The study was therefore
carried out in sectors directly linked to international markets (Cuervo-
Cazurra, 2008). That is, they are all SMEs. Tables I-III summarize the
descriptive statistics of the unit analysis.

DATA COLLECTION
Secondary data
Secondary data is data collected by other person except the researcher.
Common sources of secondary data for social science include censuses,
organizational records, and data collected through qualitative
methodologies or qualitative research. The investigator conducting the
research, by contrast, collects primary data. Secondary data analysis saves
time that would otherwise be spent collecting data and, particularly in the
case of quantitative data, provides large and higher- quality databases that
would be unfeasible for any individual researcher to collect on their own. In
addition, analysts of social and economic change consider secondary data
 essential, since it is impossible to conduct a new survey that can adequately
capture past change and development. Secondary data may either be
published data or unpublished data.

Types of secondary data

• Internal methods
• Sales analysis
• Invoice analysis
• Financial data
• Transportation data
• Storage data

Secondary method

• Libraries
• Literature
• Periodicals
• References and bibliography
• Census and registration data
• Trade associations
• Government departments
• Private sources

DATA ANALYSIS TOOLS & TECHNIQUES

Data analysis
Analysis of data is a process of inspecting, cleaning, transforming, and
model data with the goal of discovering useful information, suggesting
conclusions, and supporting decision- making. Data analysis has multiple
facts and approaches, encompassing diverse techniques under a variety of
names, in different business, science, and social science domains.

ITC Ltd.

The following are the tools and techniques of strategic analysis of ITC,
 • Investment map: It helps the investment agencies identity such as priority
sector for foreign investments, competing countries and potential
foreign investors.
• Market asses’ map: It helps to find out the national tariff level of different
countries.
• Product map: It is an online product context which includes the overall
study of the market, price indications and product information of different
organizations which helps to comparison of the services.
• Trade map: It is also an online data base which helps to find the flow of
goods and services and the barriers in the international market.

CHAPTER 4

DATA DESCRIPTION & ANALYSIS

SWOT Analysis
• ITC Limited

Strengths in the SWOT Analysis of ITC Limited

• ITC’s cigarette sector contributes a significant proportion of its sales to

the FMCG.
• Increasing Revenue of ITC Limited in the year by year is its main
strength. In the year 2019, its revenue was ₹52,035 crore.
• Operating Income is 2.7 Billion US Dollars in 2019.
• Net Income is Rs. 12824 Crores in 2019.
• Number of Employees 27279
 • Portfolio of Companies: under its name, ITC has 6 large and diverse
businesses that boost its total revenue and allow ITC to innovate and
pursue other business opportunities.
• Powerful brand: ITC is a large brand house with most of its products
leading the segments in which it works.
• ITC owns some of the most famous cigarette brands, such as the Gold
Flake and Classic. It also owns Sunfeast, one of India’s highest-selling
biscuits. Similarly, the AashirvaadChaki Fresh Ata, the Yippee! , Engage,
John Players, and Bingo are all among the industry leaders in their
respective groups.
• ITC’s hotel and property businesses are also doing well. With a portfolio
like this, ITC has become one of India’s most dominant conglomerates
and is revered all over the world.
• Efficient Social Business Initiatives: The ITC has developed a three-
pronged strategy that focuses on building national economic, social, and
environmental resources.
• ITC has introduced initiatives such as E-Choupal, ChoupalPradarshan
Khet (CPK) that support grass-roots people, i.e. farmers. Such initiatives
have also enabled ITC to boost their brand reputation as a conventional
tobacco producer.
• Inter and Intra-Divisional Synergy: ITC has effectively used the strengths
of core companies to push into newer products or categories. ITC has
leveraged the powerful distribution network of cigarette brands to build a
market for its FMCG products.
• In addition, ITC has leveraged the experience of food and bakery items
from its hotel company to become part of the Packaged Food group.
• ITC has a large and competent management team. Clear brand image,
outstanding promotional goods Diversified range of products and
services, including FMCG, hotel chains, paper & packaging, and
agribusiness.
• Over 6500 E-Choupal CSR programs and sustainability projects improve
the brand identity of ITC to more than 4 million farmers.
• ITC has reduced personnel to more than 25.000 employees Good services
for research and development.

Weaknesses in the SWOT Analysis of ITC Limited –

• High Proportion of Tobacco Product Revenues: ITC has made continuous

efforts to separate the FMCG sector from over-dependence on tobacco
products and has been successful in doing so to some degree.
 Nonetheless, tobacco products remain the biggest source of revenue
contributing more than 60 percent to FMCG’s overall revenue.
• Tobacco Products Association has an impact on the brand: ITC has made
a great deal of effort to enhance its corporate image, but the fact that ITC
has many tobacco products in its portfolio has an impact on its corporate
image. The increase in the Tobacco Tax has an effect on revenue: due to
the rise in the tax on tobacco products, rates and, subsequently, profits are
affected.
• ITC is still dependent on its tobacco sales, and people have cheaper
alternatives and other brands.
• The hotel industry has not been able to build an enormous market share.

Opportunities in the SWOT Analysis of ITC Limited –

• Acquisitions: ITC will continue to make strategic acquisitions, as it has

done in the past, by purchasing Savlon from Johnson & Johnson and B
Natural from Balan Natural Foods. Keeping in mind that the product fits
into the current distribution network, ITC will try to increase its product
range and broaden its non-tobacco FMCG business and thus improve its
revenue base.
• Growth in purchasing power and changing lifestyles: ITC can tap into
rising buying power and changing customers’ lifestyles in India. It will
help to raise sales for all of its companies.
• Growing Personal Hygiene as well as Food Processing Industry in India:
ITC should use its distribution channel in the Personal Hygiene and Food
Processing Industry to capitalize on the growth of categories and thus
increase revenue.
• Tap opportunities created in the rural sector: the rising rural sector in
India and other developing nations are generating enormous opportunities
to boost the company’s bottom line.
• Mergers and acquisitions are planned to reinforce the brand.
• Increased people’s buying power, thus rising competition. More exposure
to hotel chains to increase market share.

Threats in the SWOT Analysis of ITC Limited –

• Intensifying rivalry in FMCG companies: ITC is facing intense

competition in its FMCG market from major MNCs such as HUL and
P&G and Indian FMCGs such as Patanjali and Dabur. It limits the market
share of the ITC.
• Regulations and Increased Taxation in Cigarette Business: The Tobacco
and Cigarette Industry in India continues to be regulated by strict
government regulations and the tax system. This poses a threat to the
highly profitable ITC Cigarette company.
• Increasing health awareness: there has been an increase in health
awareness, which has resulted in a decrease in the demand for tobacco
products in India. Anti-smoking programs throughout the country also
have an effect on cigarette sales.
• Intense and increasing competition among other FMCG companies and
hotel chains.
• FDI in the retail sector, thereby allowing for international brands.

CHAPTER 5
SUMMARY CONCLUSIONS
The FMCG sector in India has played a vital role in the growth
and development of the country Fast Moving Consumer Goods (FMCG)
also known as consumer packaged goods, are those goods which are sold
quickly at relatively low costs. Some examples of FMCG includes the
wide variety of frequently purchased consumer products like soaps, tooth
pastes, detergents, shaving products, packaged food products etc.
Availability of key raw materials, cheaper labour costs and presence
across the entire value chain gives India a competitive advantage.
The FMCG market is set to treble from US$ 11.6 billion in 2003
to US$ 33.4 billion in 2015. Nielsen predicts that India’s FMCG industry
will grow from $37 billion in 2013 to $49 billion in 2016.Indian FMCG
industry expected to grow 7% in 2014, 10% in 2015 and about 12% in
2016, taking the sales in 2016 to $49 billion. Distribution growth,
innovations around sachet offerings, employment rates and index of
industrial production (IIP) are key influencers of FMCG sales in India.
ITC is an Indian conglomerate headquartered in Kolkata, West Bengal.
Its diversified business includes five segments: Fast Moving Consumer
Goods (FMCG), Hotels, Paperboards & Packaging, Agri Business &
Information Technology.
ITC is an outstanding market leader in its traditional businesses
of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports. As part
of the summer internship program various projects done in ITC’s FMCG
- personnel care division. The main project was conducted at the Big
Bazaar outlets at Trivanthapuram, Kerala where in direct sales was done
after analysing the major accounts there at Trivanthapuram. The project
was done to analyse the competitors of ITC Ltd. in Trivanthapuram city
like Pothy’s, Reliance Fresh, More and Big Bazaar outlets and then to
understand their marketing strategies and also to understand the market.

Findings and conclusions

With the liberalization and growth of the Indian economy since the early
1990s, the Indian customer witnessed an increasing exposure to new
domestic and foreign products through different media, such as television
and the Internet. Apart from this, social changes such as increase in the
number of nuclear families and the growing number of working couples
resulting in increased spending power also contributed to the increase in
the Indian consumer’s personal consumption. As a whole, these changes
have the positive impact, leading to rapid growth in the retailing industry,
and created a huge potential for the FMCG markets.

Recommendations from the study

1. The company has to come with an idea of retail store of food
products all over India following the strategy of umbrella branding.
The inauguration of such stores should be accompanied with the
products being sold at a discounted rate and all the products should
be brought under this initiative with products like food processing.

2. The company can come up with new initiatives to tie up with the
retails food joints like Mc Donald, Pizza Hut, Dominos, Smoking
Joe’s etc. and other food joints so that they use Aashirvaad atta at a
discounted rate or discounted coupon can be given to the outlets if
they are using this product of itc.

3. The company can suggest that value added food products should
not be banned from exporting but some certain restriction can be
imposed on the company to import an equivalent amount of wheat
in the country.

4. Itc’s growing presence in agriculture, food & personal care

products is enabling a synergy of R & D capabilities to venture into
future products which can be aimed at nutrition, health & well-
being.
 5. This special attention can be used to take care of the various health
disorders in the country and several long term arenas can be create
for these unique propositions.

Learning from the study

I learned from the study that ITC has the various types of product in good
quality and different types of FMCG products. ITC has the good customer
relationship and various types of services in company. They should have their
own responsibilities to their brands.

ITC has no 1 company in our India. They have the fastest services as compare
to other company.

Strength and limitation of the study

That is leveraging its learnings while dealing with the pandemic for spanning
sales and distribution, supply chain operations along with relevant innovation
and product development, ITC said in its post earning statement.

The headquartered firm said its cost reduction measures remain firmly in focus.

The Company continues to monitor the developments closely and is well geared
to respond with agility to the evolving situation while managing risks associated
with the dynamic environment," it added.

While the constraints in the number of operating outlets and limited hours of
operation are posing challenges at the front-end, there are no material supply
chain bottlenecks," the company.

ITC has a diversified presence in FMCG, hotels, packaging, paperboards and

speciality papers and agri-business.

For the financial year ended March 2021, ITC’s revenue from operations was at
₹53,155.12 crore.

Future scope of research

Board believes that as a first step, Company's portfolio should comprise four
sectors, namely, tobacco, travel and tourism, packaging and paper. This
portfolio will be subject to periodic review against the objective of international
competitiveness.

In this context, your Board recognises that international alliances can provide
your Company with access to the latest developments in know-how, technology
and best practice.

Foreign exchange earnings will remain an area of focus, not only because it is a
national priority, but also because it will enable your Company's businesses to
test their competitiveness and prepare for the growing sophistication of the
Indian market.

Your Company also plans to realise full value from the real estate investments,
taking advantage of the skills developed while growing the hotel business.

Further, your Company's most valuable assets are its trademarks. These may not
be separately valued in your Company's accounts, but remain the basis of future
income streams. For many of your Company's customers, their only connection
with your Company is through these trademarks.

Research has shown that these trademarks carry considerable goodwill which
can be more effectively exploited by entry into new lines of business. It is with
the exploration of this new opportunity in mind that we have placed the Special
Resolution for your sanction today.

In respect of your Company's other businesses it is the intention to induct

world-class partners and thus reposition them for growth. This will also provide
your Company the option to redeem its investments in these ventures in a
responsible manner. In the first instance, this programme will cover ITC
AgroTech, ITC Classic Finance and the Tribeni Tissues Division. ITC Global is
already under judicial Management in Singapore, at the instance of the creditors
of that company.

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