FMCG Sector in India and Analysis of Itc Company - Tejas Bamne

FMCG SECTOR IN INDIA AND ANALYSIS OF ITC COMPANY PGDM
“FMCG SECTOR IN INDIA AND ANALYSIS OF

ITC COMPANY”
CAPSTONE PROJECT
By
TEJAS BAMNE
Roll No.02
Batch 2019-21
In partial fulfilment of the requirements for
Post Graduate Diploma in Management
March 2021
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DECLARATION
I hereby declare that the Industrial Immersion project report entitled FMCG SECTOR IN INDIA
AND ANALYSIS OF ITC COMPANY is my work submitted in partial fulfilment of the
requirement for the Post Graduate Diploma in Management from KOHINOOR BUSINESS
SCHOOL, KURLA, and MUMBAI and not submitted for the award of any degree, diploma,
fellowship or any similar titles or prizes.
Date : Signature:____________
Place: Mumbai Student name: Tejas Bamne
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CERTIFICATE
This is to certify that the Capstone project entitled FMCG SECTOR IN INDIA AND ANALYSIS
OF ITC COMPANY is successfully completed by “tejas bamne” in partial fulfilment of the
Post Graduate Diploma in Management, AICTE Approved, through KOHINOOR
BUSINESS SCHOOL, Kurla,Mumbai - 400070.
Date :
Place : Mumbai “Prof. Dr. Sandeep Sawant”
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ACKNOWLEDGEMENT
With immense pleasure, I would like to present the project report on the FMCG SECTOR
IN INDIA AND ANALYSIS OF ITC COMPANY. It has been an enriching experience for
me to undergo my project. As a student of Kohinoor Business School, Kurla, Mumbai, I
would like to express my sincere thanks to all those who helped me during my project study.
I would like to thank my entire faculty members for the proper guidance and assistance
extended by them. I am also grateful to my parents and friends to encourage and giving me
morale support.
I would like to express my special gratitude and thanks to industry persons for giving me
such attention and time.
Last but not least my grateful thanks extended to our and my project guide Prof. Sandeep
Sawant and faculties of PGDM.
However, I accept the sole responsibility for any possible error of omission and would be
extremely grateful to the readers of this project report if they bring such mistakes to my
notices.
Place : Mumbai Name : Tejas Bamne
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INDEX
SR.NO. PARTICULARS
1 INTRODUCTION (FMCG SECTOR)
2 INTRODUCTION
3 OBJECTIVES
4 HISTORY
5 LITERATURE REVIEW
6 RESEARCH AND METHODOLOGY
7 PRODUCT LIST
8 MARKETING MIX
9 SWOT ANALYSIS
10 BCG MATRIC
11 CONCLUSION
12 WEBLIOGRAPHY
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Introduction
Fast-moving consumer goods (FMCG) sector is India’s fourth largest

sector with household and personal care accounting for 50% of FMCG
sales in India. Growing awareness, easier access and changing
lifestyles have been the key growth drivers for the sector. The urban
segment (accounts for a revenue share of around 55%) is the largest
contributor to the overall revenue generated by the FMCG sector in
India. However, in the last few years, the FMCG market has grown at a
faster pace in rural India compared to urban India. Semi-urban and rural
segments are growing at a rapid pace and FMCG products account for
50% of the total rural spending.
Market Size
The retail market in India is estimated to reach US$ 1.1 trillion by 2020
from US$ 840 billion in 2017, with modern trade expected to grow at 20
25% per annum, which is likely to boost revenue of FMCG companies.
Revenue of FMCG sector reached Rs. 3.4 lakh crore (US$ 52.75 billion)
in FY18 and is estimated to reach US$ 103.7 billion in 2020. From
October 2020 to December 2020, the FMCG market rose 7.1%, driven
by food items, health, hygiene and rural areas.
Rise in rural consumption will drive the FMCG market. It contributes
around 36% to the overall FMCG spending. In the third quarter of FY20
in rural India, FMCG witnessed a double-digit growth recovery of 10.6%
due to various government initiatives (such as packaged staples and
hygiene categories); high agricultural produce, reverse migration and a
lower unemployment rate.
Investments/ Developments
The Government has allowed 100% Foreign Direct Investment (FDI) in

food processing and single-brand retail and 51% in multi-brand retail.
This would bolster employment, supply chain and high visibility for
FMCG brands across organised retail markets thereby bolstering
consumer spending and encouraging more product launches. The sector
witnessed healthy FDI inflows of US$ 17.8 billion from April 2000 to
September 2020.
Some of the recent developments in the FMCG sector are as follows:
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• In February 2021, Food and snack company, Haldiram's partnered

with Africa's Futurelife to bring its nutritional food product range to
India. The two companies launched a range of four products—
Smart Foods, Smart Oats and Ancient Grains, Crunchy Granola
and High Protein.
• In January 2021, Tata Consumer Products announced that it is
looking for ways to add more of its beverages’ portfolio onto a
direct-to-consumer platform to capture the urban online market.
• In January 2021, Tata Consumer Products introduced two new
products, TATA Tea Tulsi Green and TATA Tea Gold Care, and
reformulated its existing Tetley Green Tea, with added Vitamin C.
• In January 2021, Dabur India decided to foray into the ‘cow ghee’
category. These product will be prepared from milk sourced from
indigenous cows bred in Rajasthan.
• In January 2021, Dabur India decided to foray into the ‘cow ghee’
category. These products will be prepared from milk sourced from
indigenous cows bred in Rajasthan.
• In January 2021, Del Monte has launched a special 1 litre pouch
pack in India, priced at Rs. 250 (US$ 3.42), thereby making olive
oil affordable to consumers.
• In January 2021, FMCG businesses in India are planning to
expand their oral care portfolio by entering new and niche
categories such as mouth sprays, ayurvedic mouth cleansers and
mouthwashes to meet the rising consumer demand for hygiene
products.
o For example, Pulling oil, an ayurvedic concoction used as a
morning oral cleansing ritual based on centuries-old
Ayurvedic regimen, was launched by companies such as
Colgate Palmolive (India) Ltd. and Dabur India.
• In December 2020, Godrej Consumer Products Limited (GCPL),
under its Godrej ProClean brand, has ventured into home cleaning
products to meet the rising demand for cleaning and hygiene
products among Indian consumers. The home cleaning products
segment, which includes branded floor, toilet and bathroom
cleaners, is estimated to be ~ Rs. 2,600 crore (US$ 354.05
million).
• FMCG companies are focusing on strengthening their e-commerce
engagement. An Ayurveda baby care range has been introduced
by Dabur, which will be sold only on e-commerce platforms. With
its contribution expanding from 1.5% to 5.6%, the e-commerce
division of the group has more than doubled over the previous
year. Similarly, in the first quarter of FY21, Marico's e-commerce
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sector has grown 37% YoY, while Emami’s e-commerce business

doubled to >100%.
Government Initiatives
Some of the major initiatives taken by the Government to promote the

FMCG sector in India are as follows:
• On November 11, 2020, Union Cabinet approved the production-

linked incentive (PLI) scheme in 10 key sectors (including
electronics and white goods) to boost India’s manufacturing
capabilities, exports and promote the ‘Atmanirbhar Bharat’
initiative.
o Developments in the packaged food sector will contribute to
increased prices for farmer and reduce the high levels of
waste. In order to provide support through the PLI scheme,
unique product lines—with high-growth potential and
capabilities to generate medium- to large-scale jobs—have
been established.
• The Government of India has approved 100% FDI in the cash and
carry segment and in single-brand retail along with 51% FDI in
multi-brand retail.
• The Government has drafted a new Consumer Protection Bill with
special emphasis on setting up an extensive mechanism to ensure
simple, speedy, accessible, affordable and timely delivery of
justice to consumers.
• The Goods and Services Tax (GST) is beneficial for the FMCG
industry as many of the FMCG products such as soap, toothpaste
and hair oil now come under the 18% tax bracket against the
previous rate of 23-24%. Also, GST on food products and hygiene
products have been reduced to 0-5% and 12-18% respectively.
• GST is expected to transform logistics in the FMCG sector into a
modern and efficient model as all major corporations are
remodelling their operations into larger logistics and warehousing.
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Introduction
INTRODUCTION OF ITC (INTERNATIONAL

TOBACCO CORPORATION)
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.
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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 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 and Greeting Cards.
As one of India's most valuable and respected corporations, ITC is widely

perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this
source of inspiration " a commitment beyond the market ". In his own words: "
ITC believes that its aspiration to create enduring value for the nation provides
the motive force to sustain growing shareholder value. ITC practices this
philosophy by not only driving each of its businesses towards international
competitiveness but by also consciously contributing to 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
multiple drivers of growth anchored on its time-tested core competencies:
unmatched distribution reach, superior brand-building capabilities, effective
supply chain management and acknowledged service skills in hotelier. Over
time, the strategic forays into new businesses are expected to garner a
significant share of these emerging high-growth markets in India.
ITC's Agri-Business is one of India's largest exporters of agricultural products.

ITC is one of the country's biggest foreign exchange earners (US $ 2.8 billion in
the last decade). 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 a case study at Harvard Business
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School, is expected to progressively create for ITC a huge rural distribution

infrastructure, significantly enhancing the Company's marketing reach.
ITC's wholly owned Information Technology subsidiary, ITC InfoTech India

Limited, is aggressively pursuing emerging opportunities in providing end-to-
end IT solutions, including e-enabled services and business process outsourcing.
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 employs over 21,000 people at more than 60 locations across India. The
Company continuously endeavours to enhance its wealth generating capabilities
in a globalizing environment to consistently reward more than 3,95,000
shareholders, fulfil the aspirations of its stakeholders and meet societal
expectations. This over-arching vision of the company is expressively captured
in its corporate positioning statement.
Multiple Drivers of Growth
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.
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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 Ashirwad, SunFest, Yippee!
Bingo!, B Natural, ITC Master Chef, Fabella, Sunbeam, Fiama, Engage, Vivel,
Savlon, Classmate, Paper kraft, Mangal deep, 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.
Leveraging Institutional Strengths
The competitiveness of ITC's diverse businesses rest on the strong foundations

of institutional strengths derived from its deep consumer insights, cutting-
edge Research & Development, differentiated product development
capacity, brand-building capability, world-class manufacturing
infrastructure, extensive rural linkages, efficient trade marketing and
distribution network and dedicated human resources. ITC's ability to
leverage internal synergies residing across its diverse businesses lends a unique
source of competitive advantage to its products and services.
'Nation First: Sab Saath Badhein'
ITC's 'Nation First: Sab Saath Badhein' philosophy underlines its core belief
in building a globally competitive and profitable Indian enterprise that makes an
exemplary contribution to creating larger societal value. As a company deeply
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rooted in Indian soil, ITC is inspired by the opportunity to serve larger national
priorities. A global exemplar in Sustainability, ITC is the only enterprise in
the world of comparable dimensions to be carbon-positive, water-positive
and solid waste recycling positive for over a decade now. ITC has created
over 6 million sustainable livelihoods. Nearly 41% of the total energy
consumed in ITC is from renewable sources. ITC's premium luxury hotels have
the unique distinction of being LEED Platinum certified.
ITC's Well-being Out of Waste programme (WOW) that comprehensively
addresses the problem of solid waste management, of which plastic waste is a
significant component, provides an end-to-end sustainable and scalable solution
that has reached out to over 1 crore citizens in the country.
Together with farmers and local communities, ITC has implemented largescale
interventions in climate-smart and sustainable agriculture that make a
meaningful contribution to the Hon'ble Prime Minister's vision of doubling
farmer incomes. Towards this, ITC has launched an integrated programme
titled 'Baareh Mahine Hariyali' (maximising farm utilisation over 12 months
of the year) to give a new dimension to the complex task of multiplying farmer
incomes. ITC is collaborating with NITI Aayog to progressively build capacity
of 2 million farmers in 27 Aspirational Districts to help enhance rural incomes.
ITC is investing in India's future by building world-class consumer goods
factories and iconic hospitality assets that will contribute to the country's
competitive capacity. These investment projects underpin the Company's
support to the Government's "Make in India" vision.
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OBJECTIVES
The primary objective of this study is to systematically explore the determinants responsible
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 would achieve 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 corporation from a single product company
Research Methodology
The researcher has used secondary data, magazines, internet, books, some market survey
using marketing tools like asking question through phone, personal interview etc.
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HISTORY OF ITC
ITC Limited is an Indian multinational conglomerate company headquartered in Kolkata, West
Bengal. 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 or an initialised form. ITC has a diversified presence across industries
such as Cigarettes, FMCG, Hotels, Packaging, Paperboards & Specialty Papers and Agribusiness.
The company completed 100 years in 2010 and as of 2019–20, had an annual turnover of
US$10.74 billion and a market capitalisation of US$35 billion. It employs over 36,500 people
at more than 60 locations across India and is part of the Forbes 2000 list.
Tobacco business and early years

"ITC Limited" was originally named "Imperial Tobacco" and was later renamed "Imperial
Tobacco Company of India Limited", succeeding W.D. & H.O. Wills on 24 August 1910 as a
British-owned company registered in Calcutta.[11][12][13][better source needed] 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.
Though the first six decades of the company's business were primarily devoted to the growth
and consolidation of the cigarette and leaf-tobacco businesses, ITC's packaging & printing
business at Munger was set up in 1925 as a strategic backward integration for ITC's cigarettes
business. It is today India's most sophisticated packaging house. More factories were set up in
the following years for cigarette manufacturing across India.
In 1928, construction began for the company's headquarters, the 'Virginia House' at
Calcutta. ITC acquired Carreras Tobacco Company's factory at Kidder pore in 1935 to further
strengthen its presence. 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
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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.
Towards Indianisation and business diversification

The 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 Bhaskar 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 Indianized, 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 centre 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
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New York, acquisition and renaming of Vishwakarma Hotels to ITC Hotels Limited, 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 Sun drop
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. Devesh war 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.
On 27 July 2020, ITC has acquired 100 percent of the equity share capital of Sunrise Foods in
a 2150 crore deal. Consequent to it, Sunrise and its two subsidiaries, Sunrise Sheetgrah
Private Ltd and Hobbits International Foods Pvt Ltd, have become wholly-owned subsidiaries
of ITC, it added. Sunrise is a market leader in eastern India in the fast-growing spices
category and has a brand legacy of over 70 years.
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LITERATURE REVIEW
For over a century, the world has witnessed remarkable material progress.
However, this progress has come at a tremendous price, creating some of the
most serious challenges facing the world today, including that of poverty,
growing inequity and increasing joblessness. Compounding these challenges are
the threats of global warming and environmental degradation. The model of
industrial growth pursued since the Industrial Revolution has paid scant
attention to the planet and its resources. The debilitating impact on air, water,
soil and bio-diversity not only threatens the present but also the socio-economic
security of future generations as well.
India mirrors these challenges. The country is home to 17% of the world's
population, but has only 2.4% of its arable land, 4% of water and 1% of forest
resources. India is poised to become the world's most populous nation by 2025.
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To ensure food, water, energy and livelihood security to the teeming millions is
a daunting task. Addressing social challenges like multi-dimensional poverty
and job creation has also become crying priorities.
Unstable societies cannot foster sustainable economic growth. The need of the
hour is a new model of development that will simultaneously fuel economic
growth, create sustainable livelihoods and replenish the environment.
Sustainability as a driving force for ITC
Any sustainable solution to addressing the grave challenges facing the world
today requires the concerted efforts of all sections of society - policymakers,
regulators, business, NGOs and civil society. At ITC, we believe that with their
immense managerial and innovative capacity, businesses can contribute
significantly towards making a transformational change in society.
Inspired by this opportunity to serve larger societal purposes, we articulated a

Vision two decades ago to make the Company a National Champion by
adopting the credo of 'Putting India First' ' keeping Country before Corporation
and the Institution before Individual. This resolve to build an exemplary Indian
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enterprise led to the creation of innovative business models that synergised the
creation of economic wealth with the formation of ecological and social capital
as a unified strategy.
Sustainability in Action
Our focus has been on spurring innovative strategies that would enable us to
make a growing contribution along the triple bottom lines of building economic,
environmental and social capital. Matching internal competencies with the
emerging opportunities in a fast growing and rapidly evolving economy, we
created multiple drivers of growth for the Indian economy through a carefully
chosen diversified portfolio of businesses. Efforts were made to create world-
class Indian brands that would help in capturing and retaining more value for
the Indian economy. The vitality of such brands also serve as market anchors to
enhance the competitiveness of the entire value chain, including that of farmers
and rural communities. To ensure a positive environmental footprint, we
adopted a low-carbon growth strategy which focused on enhanced use of
renewable energy sources as well as reduction in specific energy consumption.
Efforts to reduce specific water consumption at our units and augment rainwater
harvesting activities contributed to the imperative need to ensure water security.
Focused waste management initiatives like our flagship WoW (Well-being Out
of Waste) programme contribute to addressing yet another national priority .
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RENEWABLE ENERGY
RESPONSIBLE LUXURY
To create sustainable livelihoods, we designed interventions that respond to the
unique challenges of our stakeholder communities. Our e-Choupal, watershed
development, afforestation and sustainable agriculture interventions strengthen
agriculture, while programmes for economically empowering women and
livestock development expand rural income streams. Support for primary
education, health and sanitation as well as skilling and vocational training are
helping to develop community infrastructure and create better opportunities for
disadvantaged communities.
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RESEARCH AND
METHODOLOGY
ITC RESEARCH AND DEVELOPMENT

Innovation has always been integral to ITC's DNA, the foundation for the unique and
differentiated value propositions that it has crafted over the years.
Since 1973, ITC R&D Centre in Bengaluru has played a crucial role in building this
capability, creating products and solutions that sustain the Company's competitive advantage.
Now rebranded as ITC Life Sciences and Technology Centre, this new beginning
highlights its integral part in keeping the Company future-ready and driving its game-
changing businesses of the future. It also reflects the Centre's new mandate- to go beyond
supporting and improving ITC's existing products and services and create innovations that
not only meet but anticipate consumer needs.
ITC's ambitious agenda of sharpening its competitive edge in an enormously challenging
marketplace demands better products that can positively impact consumers' lives, demands
solutions that effectively deliver care and wellness to consumers, demands products and
services that are world-class and a byword for excellence. It is here that the Centre will step
in - endeavouring to develop path-breaking solutions that blend science, research and
technology to enhance not just product experience but overall quality of life.
The challenging task of driving science-led product innovation has been carefully addressed
by appropriately identifying the required set of core competency areas of science such as
Plant Breeding and Genetics, Agronomy, Microbiology, Cell Biology, Genomics,
Proteomics, Silviculture and several disciplines of Chemistry. Presently, the ITC Life
Sciences and Technology team has evolved with over 350 world-class scientists and is
creating Centres of Excellence in these areas. The Centre is carrying out research and
securing proprietary technologies for the Company's businesses.
AGRI-SCIENCES R&D
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The Agrisciences R&D team continues evaluating and introducing several germplasm lines
of identified crops including Casuarina and Eucalyptus to increase the genetic and trait
diversities in these species, towards developing new varieties with higher yields, better
quality and other relevant traits for ITC's businesses.
This high-end lab research is supported by field research at ITC's R&D Centre at
Bhadrachalam which is at the core of the Company's fibre strategy for its Paperboards and
Specialty Papers business. This state-of-the-art research centre is consistently striving to
improve the productivity of several tree species, in order to give attractive land-use
alternatives to traditional farmers and wasteland owners. So far, more than 100 high-yielding,
fast-growing and disease resistant 'Bhadrachalam' clones have been produced on a
commercial scale, including 23 site-specific clones adapted to problematic soils. The
productivity of these saplings is 6-9 times that of normal seedlings.
ITC's comprehensive R&D facilities at Rajahmundry in Andhra Pradesh cover all aspects
of tobacco crop cultivation. In collaboration with the Central Tobacco Research Institute and
the Tobacco Board, ITC pioneered FCV tobacco cultivation in India and introduced the
Burley and HDBRG varieties. ITC's continued focus on crop development has resulted in
new varieties of seeds and hybrids in Andhra Pradesh and Karnataka, which have
significantly improved farm yields and helped fulfil the demands of a dynamic global market.
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BIOSCIENCES R&D
ITC Life Sciences and Technology Centre has created a Biosciences R&D team to design
and develop several long-term research platforms evolving multi-generation product concepts
and associated claims that are fully backed by scientific evidence for the Foods and Personal
Care businesses. Recognising the unique construct of ITC in terms of its strong presence in
agriculture, food and personal care businesses, a convergence of R&D capabilities is being
leveraged to deliver future products aimed at nutrition, health and well-being.
In addition, ITC Life Sciences and Technology Centre has evolved a strategy in building a
new value chain called, 'Nutrition' with a special focus on 'Indianness' and 'health and well-
being' founded on the basis of Value-Added Agriculture (VAA). The initial activities related
to VAA have already commenced with a focus on Soya.
GLOBAL COLLABORATION
ITC Life Sciences and Technology Centre has also initiated several research collaborations
with globally recognized Centres of Excellence to remain contemporary and fast track its
journey towards demonstrating multiple 'proofs of concept'. These collaborations, covering
identified species, are designed in a manner that enables ITC to gain fundamental insights
into several technical aspects of plant breeding and genetics and the influence of agro-
climatic conditions on the growth of these species. Such interventions will accelerate ITC's
efforts in creating future generations of these crops with greater genetic and trait diversities
and leading to significant benefits for the Company's businesses. Further, these outcomes
have a strong potential to contribute towards augmenting the nation's ecological capital as
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well.
Master Design Facility

Catering to the need of ITC's Lifestyle Business is a contemporary master Design Facility
at Manesar, Gurgaon. It offers R&D facilities that have enabled the Company to offer
internationally benchmarked fashion collection every season.
Relentless Commitment to Quality
Pursuing the Company's relentless commitment to quality, each business is mandated to

continuously innovate on processes and systems to deliver superior competitive capabilities.
All manufacturing units of the Company have ISO quality certification. All manufacturing
units of the Branded Packaged Foods businesses (including contract manufacturing units) and
hotels have stringent food safety and quality systems. All Company owned units / hotels and
almost all contract manufacturing units of the Branded Packaged Foods businesses are
certified by an accredited 'third party' in accordance with 'Hazard Analysis Critical Control
Points' (HACCP) methodology. Additionally, the quality of all FMCG products of your
Company is regularly monitored through 'Product Quality Ratings Systems' (PQRS).
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TOBACCO RESEARCH METHODOLOGY

Over the past half century, tobacco control arguably has been America's greatest public
health success story. Antismoking campaign–induced decisions to quit smoking or not to start
in the first place have translated into the avoidance of more than 5 million premature
smoking-related deaths. On average, each of the affected individuals has gained 15 to 20
years of life expectancy as a consequence. This is a truly remarkable public health
achievement.
The glass-half-empty side of the story is that tobacco consumption, primarily in the form of
cigarette smoking, remains by far the nation's leading behaviour-related cause of death,
illness, and disability. Four hundred and thirty thousand Americans lose their lives annually
to smoking, active or passive, constituting a sixth of all deaths; another 9 million are ill or
disabled as a result of smoking, and many observers worry that the steady decline in the
prevalence of smoking over the past four decades might be slowing significantly, with a fifth
of all adults remaining smokers. Evidence points to a more addicted population of continuing
smokers. Compared with previous generations of smokers, they are less educated and more
likely to work in blue collar occupations than in the past. Importantly, a substantial
proportion of smokers suffer from a mental illness or substance abuse comorbidity. And yet,
as in the past, a sizable majority reports that they would like to quit smoking cigarettes if they
could.
Although researchers in and outside of pharmaceutical companies seek more effective
methods of helping smokers to quit, the tobacco industry, including both mainstream
companies and a new cottage industry of innovators, has adopted a different approach: they
are developing novel tobacco and nicotine-based products that, they hope, health-concerned
smokers might adopt instead of smoking conventional cigarettes. The products range from
cigarettes modified to reduce yields of specific toxins to low-nitrosamine forms of smokeless
tobacco, from dissolvable tobacco lozenges to new electronic cigarettes. Unlike the
pharmaceuticals, these products have been brought to the market at the whim of their
producers, subject to absolutely no regulation regarding their safety or efficacy as substitutes
for conventional cigarettes.
Until now, that is. In 2009, Congress passed and President Obama signed legislation giving
the U.S. Food and Drug Administration (FDA) the responsibility for regulating aspects of the
sale and marketing of cigarettes, smokeless tobacco, and related products.2 The agency's
regulatory authority with regard to this product category differs dramatically from its
26
responsibilities in its more traditional domains of pharmaceuticals, medical technologies,

cosmetics, and food products, in which agency attention focuses narrowly on product efficacy
and/or safety. Tobacco products are inherently unsafe, so the herculean task confronting the
FDA will be to address issues of relative harm and population consequences of the
introduction of novel products. Still, the critical fact is that companies wishing to bring novel
tobacco and nicotine-related products to market will no longer be able to do so without
regulatory approval. The FDA now also has the ability to impose performance standards for
all tobacco products, including conventional ones. These performance standards would also
be implemented in the context of relative harm.
Just as the tobacco control story itself represents only half a victory, the multi-year battle to
secure FDA regulation must be considered only a partial win for public health. We the people
now have at least partial authority to regulate the marketing of what has historically been the
world's most toxic category of legal products. However, we don't have complete authority,
nor do we yet possess the wherewithal to do the job assigned to the FDA. At the core of
effective regulation in all of FDA's domains lies a base of scientific knowledge, both the
methods to assess the safety, efficacy, and toxicities of products and the results of years of
research to develop a foundation of data upon which subsequent studies, and regulatory
decisions, can rely. For the task of assessing the relative toxicity of myriad novel tobacco and
nicotine-related products, the essential need to achieve sound regulation, the cupboard is
nearly bare.
Although the paucity of existent research represents a problem, it also constitutes a challenge
and an opportunity. More precisely, it constitutes a challenge that is an opportunity, an
opportunity to bring objective evaluation to a class of products that heretofore has wreaked
havoc with the public's health, and thereby to reduce the morbidity and mortality associated
with the core product, the cigarette. Although the interest in tackling this challenge in the
United States is driven by the new FDA legislation, the opportunity it affords extends to all
the world, for the toll of tobacco knows no geographic boundaries.
27
Products List of ITC

So here is the ITC products list. ITC Limited 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.
28
ITC’s Paperboards & Packaging Business

ITC’s leadership position in the value-added itc products Paperboards segment in India is
anchored on the popularity of its array of brands that caters to a wide spectrum of
innovative packaging, graphic and communication requirements.
ITC
product Classmate
Here is some of ITC products list Brands ITC’s B2B brands like Cyber XLPac, Safire
Graphik, Carte Lumina, Omega Barr, IndoBev, Neo WhiteBliss, Pharma Print, and Opaque
Tissue, among others, are differentiated products meant for specific packaging and
29
graphic usages and today enjoy top of mind recall for their distinct print and
performance qualities.
ITC’s Packaging & Printing business continued to aggressively pursue new product
development across segments as a key driver for growth. Some of its innovations, during
the year, included antifungal coated cartons, micro-perforation for specific laminates,
braille feature for labels and cold seal laminates for chocolates
30
Marketing Mix
Marketing Mix is the set of actions that a company follows to promote its brand or
product. The firm uses such tactics to pursue its objectives in the target market. Let
us have a deeper understanding of it.
Products
ITC is known as one of the topmost valuable brands. It has a diversified portfolio of
businesses, including. Here are some of the ITC products that contribute the most to
its business:
1. It sells cigarettes, which includes gold flake kings, wills navy cut, gold flake superstar, and
India kings are some of its major brands.
2. In terms of packaged foods, it has ranked in the first place and some of its food brands are
Bingo, Sunfeast, Aashirvaad, and Yippee.
3. The company sells lifestyle clothing under brands like Wills Lifestyle.
4. They also provide skin and hair care products related to personal care.
5. It is also involved in the stationary industry which includes classmates and colour crew.
6. It manufactures and sells safety matches.
7. The company is engaged in the hotel and service industry and ranks as India’s second-
largest hotel chain.
8. It is involved in paperboards and produces high-quality paper.
9. The business provides global and domestic markets with services such as printing and
packaging.
10. ITC Infotech Limited is a subsidiary and operates the company business sector
ITC being a multi-market conglomerate with business and is associated with several
industries it covers various products as above.
Price Strategy
The company is involved in several business interests and thus faces a lot more
competition in the market. Therefore to boost its market segments the company tries
to create its presence all over India with reasonable pricing policies. The company
has adopted premium pricing policies for luxurious products and reasonable pricing
for the middle-class segment which will eventually help in generating sales and
ultimately will lead to better revenue figures. They follow different pricing strategies
for different products.
For instance, as Bingo was entering the market, it had adopted a very clever
aggressive pricing strategy that captured the market. As they had maintained a
reasonable pricing strategy as per the market but offered more quantity and more
margin to the retailers which gave them a competitive edge.
31
ITC Place Strategy

The company’s distribution channel is widespread and thus its products are available
in every retail store. It has a strong distribution channel as it delivers the product
quickly as possible. It also has a well-established manufacturing and logistics
distribution network. The company has four manufacturing units and more than 60
dealers in India. The food products are also exported internationally in countries like
North America, Australia, the Middle East, and Africa.
Promotional Strategy of ITC

The promotion strategy of the company has something unique keeping in mind its
brand proposition and its target audience. It promotes its product on various social
media platforms also through print, television, and radio. The brand presence is well-
diversified due to their extended product portfolio, they also have different brand
ambassadors for different brands. It has implemented an aggressive marketing
strategy and has taken advantage of any promotional medium available to sell its
products. Several ad campaigns have been launched, which are seen on popular TV
channels, broadcasted on the radio, and shown by hoardings. It has also roped in
prominent personalities such as Kareena Kapoor and Shahrukh Khan for better
visibility.
These were some of the marketing mix strategies implemented by the company.
ITC Competitors and Analysis

It is a multinational conglomerate company and thus they face huge competition in
the market. They have competition from all sides, we have shortlisted some of the
main competitors in all these distinct fields that it faces. Let us take a look here.
ITC Competitors In FMCG segment

1) HUL
2) P&G
3) Nestle
4) Godrej Consumer Products
5) Godfrey Phillips India Ltd
6) Danone
7) Coca-Cola
8) Colgate
9) Dabur
10) Marico
11) L’oreal
ITC Competitors In Hotels

1) Leela Hotels
2) Taj Group of Hotels
3) Oberoi Group of Hotels
4) Sarovar Group of Hotels
32
ITC Competitors in Cigarettes

1) Philip Morris International
2) Golden Tobacco Limited
3) Godfrey Phillips India Ltd
4) Raghunath Tobacco Company Ltd
5) Vazir Sultan Tobacco Company
As we see ITC has major competition in all segments of the market and thus they
boost their market share they come up with various marketing strategies.
The competitive advantage of ITC

1. Vast experience
As the company has a long market presence it has developed a strong base. This
has allowed the business to recognize the customer’s needs and expectations to
make it financially strong and competitive ahead of its peers.
2. The X- Factor
Through the social initiative, ITC’s E-Choupal initiative aimed at making the internet
accessible to Indian farmers and their families in the rural part of the country, thus
increasing brand presence to the business.
3. Big Conglomerate
Over the years, they have become a massive conglomerate providing a wide range
of goods and services in the FMCG market, IT solutions, from agri-products to food
products. Experience in such a diverse range of products and services has enabled
the business to emerge in the market.
Thus, the competitive advantage of the company has been achieved by the
consistent work of ITC which helps them to stand out in the market.
33
SWOT Analysis
SWOT Analysis identifies the Strengths, Weaknesses, Opportunities, and Threats of

the business which helps us to assist you in making strategic plans & decisions. It
also helps you to move in a balanced way throughout your program. ITC is a unique
organization with many strengths, but it suffers from its own threats and problems.
Let us have a deeper look.
Strength
• It has a strong brand presence in various businesses
• They have excellent research and development facilities.
• It has a deep distribution channel.
Weakness
• ITC is still recognized as a tobacco company.
• There is an increase in tax on tobacco and cigarettes.
Opportunities
• The company has the opportunity to get into the untapped rural market.
• Mergers & Acquisitions to strengthen the brand.
• More publicity to hotel chains to increase market share.
• Increasing purchasing power of people thereby increases demand.
• Growth in purchasing power and improving lifestyle.
• Growing personal hygiene as well as food processing industry in India.
Threats
• It faces major competition from both domestics and international players.
• Strict regulations and increasing taxation in the cigarette business
• Slowdown growth in the rural market.
ITC has grown immensely and has also received some great opportunities in the
market. They are consistent in their work and therefore the company manages to
overcome threats.
ITC Marketing Strategy

A marketing strategy refers to an overall business plan that helps to target the
consumers and, therefore turning them into potential customers of the goods or
services. Let’s look further into the specifics of their strategy.
• Segmentation, targeting, positioning of ITC
34
As a brand, it serves the needs of a diverse range of market groups by segmenting

the population based on common types of features. A mix of regional demographic
and psychographic segmentation factors such as occupation, income level, gender,
age, area, behaviour, etc. are used by ITC.
• Distribution strategy of ITC
The company operates with its own distribution channel, goods are made available
to wholesale distributors through carried & forward agents (CFA’s), which are then
transmitted directly or through small, wholesale, dealers to retailers in cities to meet
customers in the most remote areas of the nation.
• Target Audience of ITC
With its diverse range of goods and services, ITC caters to consumers from the 5-60
age group with its products ranging from Candyman, Mint-o to Aashirvaad, etc. ITC
meets the needs of different companies in the B2B market, as well as ITC Infotech in
the IT sector and ITC Hotels in the hospitality sector.
Therefore the marketing strategy of ITC has implemented various strategies to boost
their market segment.
ITC Marketing Campaigns

The company has taken initiative to create brand awareness on various social media
platforms. It came up with the #proudly Indian campaign and #Sab Saath Badhein
campaign. Let us have a look at what this campaign means.
1. #proudly Indian campaign
Source – ITC Youtube

Here the brand showcases how the products reflect the spirit of making in India’s
campaign runs across various social media platforms which generate considerable
35
interest in citizens. The campaign was initiated in 2020 with the philosophy of vocal
for local.
2. #Sab Saath Badhein campaign
Source – ITC Youtube

‘Sab Saath Badhein’ is a corporate campaign that comprises a series of four TVCs
(Television Commercial ) Sab Saath Badhein is an expression of ITC’s sustainable &
inclusive growth.
These were the various marketing campaigns initiated by the company which
created huge brand awareness.
36
ITC Digital Marketing Strategy

A digital presence simply refers to how your business appears online and how you
manage your brand on various social media platforms. Following is the social media
presence of ITC on Facebook, Instagram, and Twitter.
Facebook Profile
Source – Twitter of ITC
Instagram Profile
37
Twitter Profile
From the above images, we see the company profile on various social media
platforms has a huge presence and thus has a strong base in the market.
38
BCG Matrix of ITC
A close study of the expected growth rate and the subsequent market rate will give
us the preliminary information for our BCG matrix. As the number of brands is
numerous, for simplicity's sake, we will take into consideration the ITC's businesses
and will make the BCG matrix of ITC.
Let's have a look at our ITC BCG Matrix.
The BCG matrix of ITC Ltd has divided its key business units into four broad
categories. Let's have a look at them one by one.
39
Star Products
ITC Ltd has three stars: Paperboards, Specialty Paper and Packaging;
Hotels and Agri-Business.
Let's find out why first.
The Paperboards and Specialty paper business are India's largest in sales among
the paper and paperboards businesses. The industry is slated to grow by 7.8 %
CAGR by 2024.
ITC hotels are one of the fastest-growing hospitality chains in India. The hospitality
business's growth rate places it in the Star category.
ITC Agri business is among the largest integrated Agri business units and is the
country's largest exporter. The Agri business is expected to grow by 10.70% by
2040.
All three businesses have a high growth rate and also has a high market share. This
places them in the star category.
They are the fast-growing market leader. They generally have the largest profits but
needs a lot of cash to finance rapidly. This means that marketers have to reinvest all
their earnings from the stars into promoting the stars.
Cash Cow Products
ITC Cigarette and Cigar business is the market leader in India with its wide
range of brands available. It is the leader in every segment of cigarettes and Cigars
sold in India. The growth in this sector is expected to be only 3% by 2021 in India.
The Cigarettes and Cigars in the FMCG sector have a high market share. Still, the
industry's growth is slow, which means that the product is in a low growth market but
has a dominant market share.
40
Marketers will have to maintain their market share. The excess cash generated can
be used by other products in the portfolio where large investments are required. The
extra money is usually pumped into brands in question mark category, which has the
potential to be a star.
Question Mark Products
ITC foods come under the question mark category, the food industry in the
FMCG sector is expected to grow by 23.15% CAGR by 2021. ITC FMCG products,
particularly foods, is growing but the growth rate is only 7.3 %.
The product is in a high growth market, but the market share is low. Hence, it's a
question mark which means it shows rapid growth but lower profit margins. It needs
a great deal of cash to increase market share.
The marketers can either use the cash to invest heavily in gaining market share,
acquire competitors or drop the SBU at all. They will need to make a lot of efforts to
make the question mark progress to a star.
Dog Products
ITC Information Technology under the brand name ITC Infotech faces immense
pressure by competitors like Infosys, TCS, Accenture, HCL. With the entry of
international players, the market share is declining.
ITC Infotech has a low market share in a low growth market. As most dogs
eventually leave the marketplace, ITC Infotech future existence is questionable here.
41
The marketers can either divest or harvest the business. Divesting is the practice of shutting
down the SBU. In contrast, harvesting is the practice of cutting back all the investment to
maximise profits, even if it loses all market shares.
42
CONCLUSION
• ITC promoting their brands through advertisement campaign as well as door to
door promotion
.• ITC is also focusing on Retailers and Wholesalers to promote their brand.
• The demand of their product in very low, because people don’t know about their
brands very well
.• ITC knows their strength and weakness in the personal care market, so they are
applying new concept to overcome their weaknesses.
• ITC now offering more margins, exiting offers and long credit period to retailers and
wholesalers.
43
WEBLIOGRAPHY
https://www.superheuristics.com
https://indiancompanies.in
https://www.mbaskool.com
https://iide.co
https://www.ibef.org
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FMCG Sector in India and Analysis of Itc Company - Tejas Bamne

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FMCG SECTOR IN INDIA AND ANALYSIS OF ITC COMPANY PGDM

“FMCG SECTOR IN INDIA AND ANALYSIS OF

In partial fulfilment of the requirements for

Post Graduate Diploma in Management

AND ANALYSIS OF ITC COMPANY is my work submitted in partial fulfilment of the

fellowship or any similar titles or prizes.

Place: Mumbai Student name: Tejas Bamne

OF ITC COMPANY is successfully completed by “tejas bamne” in partial fulfilment of the

Post Graduate Diploma in Management, AICTE Approved, through KOHINOOR

BUSINESS SCHOOL, Kurla,Mumbai - 400070.

Place : Mumbai “Prof. Dr. Sandeep Sawant”

Place : Mumbai Name : Tejas Bamne

1 INTRODUCTION (FMCG SECTOR)

6 RESEARCH AND METHODOLOGY

Fast-moving consumer goods (FMCG) sector is India’s fourth largest

The Government has allowed 100% Foreign Direct Investment (FDI) in

• In February 2021, Food and snack company, Haldiram's partnered

sector has grown 37% YoY, while Emami’s e-commerce business

Some of the major initiatives taken by the Government to promote the

• On November 11, 2020, Union Cabinet approved the production-

INTRODUCTION OF ITC (INTERNATIONAL

ITC is one of India's foremost private sector companies and a diversified

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

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

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

School, is expected to progressively create for ITC a huge rural distribution

ITC's wholly owned Information Technology subsidiary, ITC InfoTech India

Multiple Drivers of Growth

Leveraging Institutional Strengths

The competitiveness of ITC's diverse businesses rest on the strong foundations

•Why people are buying the products.

•What all the things which influences them to buy

•To understand how

has diversified themselves to a multi-product corporation from a single product company

Tobacco business and early years

Towards Indianisation and business diversification

Sustainability as a driving force for ITC

Inspired by this opportunity to serve larger societal purposes, we articulated a

ITC RESEARCH AND DEVELOPMENT

Master Design Facility

Relentless Commitment to Quality

Pursuing the Company's relentless commitment to quality, each business is mandated to

TOBACCO RESEARCH METHODOLOGY

responsibilities in its more traditional domains of pharmaceuticals, medical technologies,

Products List of ITC

ITC’s Paperboards & Packaging Business

ITC Place Strategy

Promotional Strategy of ITC

ITC Competitors and Analysis

ITC Competitors In FMCG segment

ITC Competitors In Hotels

ITC Competitors in Cigarettes

The competitive advantage of ITC

SWOT Analysis identifies the Strengths, Weaknesses, Opportunities, and Threats of

ITC Marketing Strategy

As a brand, it serves the needs of a diverse range of market groups by segmenting

ITC Marketing Campaigns

Source – ITC Youtube

2. #Sab Saath Badhein campaign

Source – ITC Youtube

ITC Digital Marketing Strategy

Source – Twitter of ITC