THE MAR­KET BUILDERS

ITC | ES­TAB­LISHED IN 1910

India Today - - INSIDE - —Chinki Sinha

ITC, FABINDIA, TI­TAN, HIN­DUS­TAN LEVER, GRASIM, M&M

MOD­EST START

ITC be­gan its busi­ness life in 1910, oper­at­ing out of a mod­est of­fice in Radha Bazar Street in Cal­cutta. At the time, this of­fice was just a small out­post of what was a multi­na­tional cor­po­ra­tion—the Im­pe­rial To­bacco Com­pany of In­dia Lim­ited, which was head­quar­tered in Bri­tain. As the own­er­ship of the com­pany be­came pro­gres­sively more In­dian, the com­pany’s name was changed, be­com­ing the In­dia To­bacco Com­pany in 1970 and ITC Lim­ited in 1974. From then on, as the com­pany’s port­fo­lio ex­panded be­yond to­bacco to in­clude fast mov­ing con­sumer goods such as food, per­sonal care prod­ucts, cloth­ing, sta­tionery, in­cense and safety matches, among oth­ers—not to men­tion its boom­ing ho­tel busi­ness—the com­pany was rechris­tened ITC Lim­ited, with ‘ITC’ no longer an acro­nym.

The com­pany’s jour­ney from that be­gin­ning to a multi-busi­ness en­ter­prise is truly rep­re­sen­ta­tional of the sci­ence of stay­ing rel­e­vant, reading the signs and adapt­ing.

EX­PAN­SION PLAN

In the mid-’70s, ITC ven­tured into the ho­tels and pa­per­boards busi­nesses. The group lever­aged its con­sumer in­sights and mar­ket­ing skills to ex­pand its ho­tels busi­ness, and over the years re­shaped the land­scape of the In­dian ho­tel in­dus­try. The ho­tels busi­ness was launched in 1975 with the ac­qui­si­tion of a ho­tel in Chen­nai, later rechris­tened ITC-Wel­com­group Ho­tel Chola and sub­se­quently My For­tune, Chen­nai. ITC has over a hun­dred owned and man­aged prop­er­ties spread across In­dia un­der four brands—ITC Ho­tels, Lux­ury Col­lec­tion, Wel­comHo­tels, For­tune Ho­tels and Wel­comHer­itage. It took its first step to­ward in­ter­na­tional ex­pan­sion with an up­com­ing su­per pre­mium lux­ury ho­tel in Colombo. In ad­di­tion, ITC Ho­tels also re­cently tied up with RP Group Ho­tels & Re­sorts to man­age five ho­tels in Dubai and In­dia.

Un­der the lead­er­ship of two suc­ces­sive CEOs—J.N. Sapru and K.L. Chugh, in the mid-’80s—ITC en­tered the fi­nan­cial ser­vices busi­ness, set­ting up a new di­vi­sion named ITC Clas­sic Fi­nance Ltd in 1986. In 1988, the com­pany made a foray into the ed­i­ble oils busi­ness. In 1990, ITC ac­quired the spe­cialty pa­pers com­pany Triveni Tis­sues Ltd while ITC Global Hold­ings was set up in Sin­ga­pore in 1991. But suc­cess did not come with­out at­ten­dant chal­lenges. In 1996, a ret­ro­spec­tive ex­cise duty of Rs 803 crore was de­manded of it and there also en­sued a battle for con­trol of the com­pany.

That was when, un­der Y.C. Devesh­war’s lead­er­ship, the com­pany re­de­fined its vi­sion to build an ex­em­plary In­dian en­ter­prise. The com­pany was re­struc­tured and it echoed ‘In­dia First’ in its new strat­egy of cre­at­ing a value chain. ITC is now among the top three in In­dia in terms of con­tri­bu­tion to the ex­che­quer. Over the past 21 years, the com­pany’s con­tri­bu­tion to the In­dian ex­che­quer has been about Rs 2.7 lakh crore.

COM­ING UP NEXT

ITC is cur­rently aim­ing to be­come In­dia’s fore­most FMCG com­pany. It as­pires to achieve a turnover of Rs 1 lakh crore by 2030. The com­pany is ag­gres­sively bet­ting on the fu­ture, hav­ing in­vested sig­nif­i­cant sums to set up the ITC Life Sciences & Tech­nol­ogy Centre (LSTC) in Bengaluru, for the pur­pose of re­search and de­vel­op­ment. Prod­uct de­vel­op­ment in the per­sonal care arena will be in­spired from re­search fo­cus­ing on ‘In­di­an­ness’—essen­tially, a blend of In­dian ge­net­ics as well as en­vi­ron­men­tal fac­tors of prime rel­e­vance to the In­dian con­sumer of per­sonal care prod­ucts. The LSTC has al­ready filed more than 630 patent ap­pli­ca­tions.

ITC is also in­vest­ing in cre­at­ing na­tional as­sets by set­ting up 20 in­te­grated con­sumer goods manufacturing and lo­gis­tics fa­cil­i­ties. It has also in­vested in the con­struc­tion of 10 sig­na­ture ho­tel prop­er­ties. That aside, the com­pany is also look­ing to en­hance its lead­er­ship in the farm-to-fork value chain by putting up state-of-the-art cli­mate con­trolled in­fra­struc­ture and ex­pand­ing its value chain to cover farm pro­duce, in­clud­ing fresh, frozen and de­hy­drated fruits and veg­eta­bles.

BANDEEP SINGH

BEST FOOT FOR­WARD ITC chair­man Y.C. Devesh­war

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