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Submitted by :

Abhay DusejaAmulpreet Singh

Ankit Jain

Ashish Shah

Deepesh Agrawal

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Agenda

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ITC - Overview

Sector Overview and Demand Supply

Breakdown of Revenue & ROCE

PESTEL Analysis

Porters Five Force ModelSWOT Analysis

Valuation

Financials

Future Perspective

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ITC Overview ITC is a Indian Conglomerate with Diversified

businesses in

FMCG

Hotel

Agri Business

Paperboards, Paper and Packaging

Annual turnover of $7 billion and Market Cap of $34billion

Market Leader : Hotels, Paperboards, Packaging, Agri-Exports and Cigarettes

Gaining market share : Packaged Foods, Branded Apparel,Personal Care and Stationery.

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FMCG

Market Leadership

Powerful brands across segments

Large FMCG Distribution network

Serving 1,00,000 markets & 2million retail outlets

Leadership in almost all segments-Geographicand price

Branded packaged foods one of the fastestgrowing food businesses in the country.

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FMCG: Demand and supply

Cigarettes account for less than 15% of tobaccoconsumed in India unlike world pattern of 85%due to prolonged punitive taxation

Biri : Cigarettes ratio = 8 : 1

48% of adult Indian males consume tobacco. Only10% of adult Indian males smoke cigarettes ascompared to 16% who smoke biris and 33% whouse smokeless tobacco (Source: Global AdultTobacco Survey Ind ia 2010)

Personal Care:Current market size estimated atover ` 40,000 crores (growing at 12% p.a.)

Current Safety Matches & Incense sticks industryconsumer spend estimated at INR 5000 crores

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FMCG : Demand and supply Contd.

Education and statinery business is emerging(currently INR 12000 crores Stationery) market inIndia growth driven by increasing crossculturalexposure, government spending on education

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Hotels

External Factor Analysis Score

ITC Welcomgroup: Fastest growing chain in thecountry

93 properties across 64 locations

First hotel chain in the world to have all itspremium luxury hotels certified at the highestLEED (Leadership in Energy and EnvironmentalDesign)

ITC Grand Chola First 5 Star 'Green Rating forIntegrated Habitat Assessment' (GRIHA) ratedluxury hotel by the Ministry of New andRenewable Energy

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Hotels: Demand and Supply

Foreign arrivals into India: ~6 million Vs. ~56million in China.

The two nations were on par 2 decades ago.

Today, Beijing alone has as many hotel rooms asthe whole of India.

Current supply 140,000 rooms of which 5 Starcategory accounts for about 25%

India needs an additional 50,000 rooms in thenext 2/3 years to service projected tourist arrivals

Present mismatch between supply and demandexpected to persist over the short term

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Agri Business

No 2 in Agri commodities Pioneer in rural transformation

Export business robust growth in exportvolumes in recent years with improvement in

realizations Farm linkages in 17 States covering Soya, Wheat,

Marine products, Potato,Coffee etc. Focus onvalue added agri commodities

Implementing Information Technology for thetransformational e-Choupal initiative

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Agri Business : Demand and supply

India the second largest producer of tobacco Over 40000 villages linked through around 6500

eChoupals servicing over 4 million farmers

Procurement: cost & quality optimisation

Strategic sourcing support to the Foods business(support creation of verticals in wheat, potato etc.)

costeffective sourcing for exports/domesticexternal business

Rural retail

24 Choupal Saagars operational

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Paperboard

ITC's Paperboards and Specialty Papers Divisionis India's largest, technologically advanced andmost eco-friendly paperboard business.

Pioneer in rural transformation

Export business robust growth in exportvolumes in recent years with improvement inrealizations

Farm linkages in 17 States covering Soya, Wheat,Marine products, Potato,Coffee etc. Focus onvalue added agri commodities

Implementing Information Technology for thetransformational e-Choupal initiative

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Paperboard : Demand and supply

Annual paperboard demand approximately. 2.9million tones.

Low per capita usage of paper at around 9 kgsp.a. (world average over 55 kgs p.a.)

Indian paperboard market growing at 7.5% p.a. Value Added Coated board, the fastest growing

segment (12% p.a.)

Ozone bleached Pulp Mill fully operational one

of its kind in Asia meeting worldclassenvironmental standards

Fully integrated with inhouse pulping capacity at~3 lakh MT

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Breakdown of Revenue

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ROCE

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PESTEL ANALYSIS OF FMCGINDUSTRY

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Porters Five Force Model for FMCG

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SWOT ANALYSIS

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ITC has highly experienced team of

management

Strong brand presence, excellent product

marketing and advertising

Diversified product and services portfolio

which includes FMCG, Hotel chains, paper &

packaging and agri-business

Impressive Financial Performance

High dependency on the tobacco

business segment

Lack of contribution from hotel/resort

business segment

Very low exports contribution

Wide income disparities

Availability of cheaper

substitutes

Fragmented industry and intensecompetition

Changes in Government Policies like tax

structure, removal of import restrictions

Untapped rural market &

Increasing penetration

opportunities in urban areas

Increasing purchase power

Leverage on brand equity

Mergers and acquisitions to strengthen the

brand and technological advancement

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Future Perspective :

Cigarettes:

With increasing taxation policy (to reducecigarettes consumption in India), company canplan Nicotine free cigarettes for the addictedpeople.

Hotel :

ITC can attract more revenues by opening newmidrange hotels at many tourist places and

business destinations Tie up with airlines and online ticket booking sites

.

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Agri Business:

Fragmented land holding, poor infrastructure,restricted access to scientific knowledge andendemic inefficiencies of the market have engulfedthe farmers in a vicious cycle of low risk taking

ability, low productivity and low margins. To address some of these challenges, Company

has been involved in the creation of on and off-farm sustainable livelihood opportunities whichempower stakeholder communities to conserve

and manage their resources.

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Paperboards, Paper and Packaging :

Improved utilisation of biomass and additionalwind mills have led to over 41% ofCompanys totalenergy requirements being met from renewablesources, compared to 38.5% during the year 2011-

12. A systemic approach is being developed to ensure

that Company progressively moves towards abenchmark of utilising at least 50% of its totalenergy requirements from renewable sources in

the near future..

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Thank You

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