ITC began as a tobacco company in 1910 and has since diversified into various business segments including FMCG, hotels, paper, and IT. ITC aims to enhance wealth creation and deliver superior stakeholder value through world-class performance. Some of ITC's strengths include its strong brands and management. It faces threats from increasing taxes on cigarettes and potential health hazards. ITC has pursued a strategy of entering new markets and continuous innovation across its product segments.

1. SUBMITTED BY
HIMANSHU SHEKHAR 12EX021
PIYUSH DWIVEDI 12EX035
SREEKANT SUKUMAR 12EX049
VIVEK KUMAR 12EX056
OPERATION STRATEGY BY ITC

2. THE ITC VISION
Sustain ITC's position as one of India's most
valuable corporations through world
class performance, creating growing
value for the Indian economy and the
Company's stakeholders
THE ITC MISSION
To enhance the wealth generating capability of
the enterprise in a globalising
environment, delivering superior and sustainable
stakeholder value

3. INTRO
 Incorporated in 1910, as Imperial Tobacco
Company of India Limited
 Changed to Indian Tobacco Limited in 1970
and then to I.T.C Limited in 1974
 With wide portfolio from FMCG to hotels
renamed to ITC limited in 2001

4. Companies Diversification tobacco
 Started as a cigarette, tobacco leave
manufacturing
 Packaging and printing business started in
1925 to backward integrate with cigarette
business
 1985 Surya tobacco Co in Nepal set up,
renamed to Surya Nepal Pvt Ltd in 2002
becoming a subsidy of ITC
 In 2010, ITC launched its hand rolled
cigar, Armenteros

5. Companies Diversification paper
 1979 entry in paper business, ITC
Bhadrachalam
 1990, Tribeni tissues limited acquired,
speciality paper for cigarette
 Nov 2002, Tribeni tissues division and
Bhadrachalam paper board combines to form
Paperboards & Specialty Papers Division

6. Companies Diversification stationery
 Paperkraft notebooks launched in 2002
 Classmate range launched in 2003
 2007 Practical Books, Drawing Books,
Geometry Boxes, Pens and Pencils under
the 'Classmate' brand
 Paperkraft -eco friendly premium business
paper
 Colour crew- art stationery brand launched in
2010

7. Companies Diversification apparels
 2000 launch of Wills lifestyle
 Wills Classic formal wear (2002) and Wills
Clublife evening wear (2003)
 Men's wear brand, John Players, in 2002
 Wills Lifestyle India Fashion Week launched
in 2006 acts as a platform for B2B for fashion
industry

8. Companies Diversification food
 Kitchens of India- ready to eat food launched in
2001
 Mint-o, Candyman & Ashirvad launched in 2002
 2003 saw the raise of Sunfeast as a major player
in biscuit segment
 Entry into snack with Bingo in 2007 & noodle
industry with Sunfeast Yipee in 2010

9. Companies Diversification others
 Launched in 2005 Personal Care portfolio has
grown under 'Essenza Di Wills', 'Fiama Di
Wills', 'Vivel' and 'Superia'
 1975 ITC- Welcomgroup hotel Chola
acquired in Chennai, now known as Fortune
Hotels
 2000 launched the ITC Infotech
 Enters matchboxes industry in 2002 and 2003
launches incense sticks

11. SWOTAnalysis
Strength
Brand
Management
Weakness
Unrelated diversification
Opportunity
Rural market
E-choupal
Threats
Increasing tax in
Cigarettes
Health hazard

12. The BCG Matrix
Stars
•Hotels
•Paperboards/
Packaging.
•Agri business.
?
•FMCG- Others
Cows
•FMCG-Cigarettes
Dogs

13. PoliticalAspects
 In 2001 Government of India has announced
ban on the advertising by cigarettes
Companies. Therefore many policies have
come up like this.
 Increased in Excise duties.

14. EconomicalAspects
 A growing portfolio of business encompassing FMCG,
Paperboards &Packaging, Agri & Foods Business, Hotels
and Information Technology.
 Total Shareholder Returns, measured in terms of increase in
market capitalization and dividends, grew at a compound
rate of over 24% per annum over the last 5 years.
 The new FMCG businesses support the competitiveness,
technology up gradation and market reach of over 200 Small
and Medium Enterprises (SMEs).

15. SocialAspects
 ITC Group provides direct employment to more than
26,000people.
 ITC‟s globally recognized E-choupal initiative is the world‟s
largest rural digital infrastructure benefiting over 4 million
farmers.
 •
 ITC‟s Watershed Development initiative brings precious
water to over 46,000 hectares of dry lands and moisture-
stressed areas.
 •
 ITC‟s Sustainable Community Development initiatives
include women‟s empowerment, supplementary education.

16. TechnologicalAspects
 Wholly own subsidiary named “ITC
INFOTECH”
 India‟s fastest growing IT services and
solution providers
 Providing services in more than 140countries

18. Major strategies followed by ITC:
 Entering into less competitive or unexplored
markets (ready to eat, staples, wafers).
 A managed supply chain network.
 Innovation-Regular introduction of new products
(all products). Supported by R & D.
 Market differentiation ( Ready to eat, biscuits)
 Cost control strategy (all products)
 Extensive advertising (biscuits, confectionary,
wafers)

19. Competitors
 HUL
 BRITANNIA
 PARLE
 NESTLE

20. Diversification

21. PROS of Diversification
 Economies of scale and scope
 Operational synergies can be realized.
 Spreading the firm's unutilized organizational resources to other areas can create
value.
 Leveraging skills across businesses can create value.
 Internal capital market
 Cash from some businesses can be used to make profitable investments.
 External finance may be more costly due to transaction costs, monitoring
costs, etc.

22. Contd…
 Diversifying shareholders’ portfolios
 Individual shareholders may benefit from investing in a
diversified portfolio.
 Identifying undervalued firms
 Shareholders may benefit from diversification if its
managers are able to identify firms that are under valued
by the stock market.

23. CONS of Diversification
 Combining two businesses in a single firm is likely to result
insubstantial influence costs.
 Resource allocation can be influenced by lobbying.
 Costly control systems may be needed that reward managers based on
division profits and discipline managers by tying their careers to
business unit objectives.
 Internal capital markets may not work well in practice.
 Shareholders can diversify their own personal portfolios. Corporate
managers are not really needed to do this.
 Identifying undervalued firms may not be as easy as it sounds.

24. Future Positioning of ITC
Aleading FMCG playerin India
F
A
R
M
E
R
S
M
A
R
K
E
T
S
CigaretteTrade Marketing capability
Branded
Foods
Expanded FMCG distribution capability
e-choupal rural two-way
fulfillment capability
A basis for strategic partnerships with other
FMCG brand owners
VPN providing SCM, ERP & CRM capability
Lifestyle
retailing
Greeting
cards/st
ationery
Matches &
Agarbatti
s

25. Conclusion
 Leverage upon its existing skills and competencies. Benchmarked
it‟s operations and quality control techniques.
 Strong branding capabilities backed by good quality.
 Won numerous awards like „Enterprise Business
Transformation Award‘, NASSCOM - CNBC IT User Award
etc.
 ITC‟s strong distribution capabilities and a strong brand name are
a useful asset.
 Using its agri sourcing network to source raw materials for its
biscuits and atta businesses.

26. Ahead of Competition