ITC, a conglomerate spanning hotels to consumer goods on Tuesday disclosed that its packaged consumer goods division experienced a robust 14 per cent Compound Annual Growth Rate (CAGR) in revenues over the last three years, concurrently introducing 300 new products.
In the fiscal year 2022-23, this segment, encompassing brands like Aashirvaad, Sunfeast, Fiama and Engage, amassed revenues of Rs 19,123 crore. During the Institutional Investors and Financial Analysts Day, the company highlighted a 310 basis-point surge in Ebitda margins within this business unit over the same period, marking a five-fold revenue increase since 2009-10, excluding cigarettes.
Presenting strategic plans to stock exchanges, ITC outlined its focus on a future-ready portfolio, an optimised supply chain, a smart-omni-channel network and value-enhancing mergers and acquisitions (M&As) to propel its consumer goods segment. Additionally, the corporation emphasised reinforcing its core portfolio within brands like Sunfeast, Bingo, Aashirvaad, Savlon and Sunrise, while venturing into adjacent categories such as expanding kitchen staples under Aashirvaad and introducing smoothies under Sunfeast, alongside other innovations, aiming at premiumization.
Reports indicate a significant shift towards premium products in ITC’s personal-care and packaged foods portfolios, with 37 per cent and 35 per cent respectively now falling into the premium category. The company has also diversified into health and wellness products through investments in brands like Yogabar and Mother Sparsh.
Furthermore, ITC is committed to annual Ebitda margin expansion by 80-100 basis points, focusing on premium offerings, scalability and cost optimisation. Analysts, reflecting on the company’s plans, emphasised ITC’s efforts to fortify its presence in personal care and its strategic approach to M&As, prioritising value-enhancing acquisitions over mere growth.
The company spotlighted achievements in brand spends, citing Aashirvaad and Sunfeast crossing Rs 8,000 crore and Rs 5,000 crore respectively in consumer spends last fiscal year, with other brands like Bingo!, Yippee!, Sunrise, Classmate and Mangaldeep also commanding significant consumer spends.
Sanjiv Puri, ITC’s chairman and managing director, underlined the company’s drive to construct a robust, competitive, and forward-looking FMCG business. He highlighted the implementation of a digital superstructure named DigiArc to bolster efficiencies, agility, and competitiveness across various business aspects, harnessing technologies like AI and Industry 4.0. Puri emphasised the company’s growth pursuits through higher value-added products, digital commerce and sustainability.
