Diversified group ITC has set a target of garnering a revenue of Rs 1 lakh crore by 2030 from its FMCG business, as it looks to increase presence in the segment, company’s chairman Y C Deveshwar said on Friday.
At present, revenue from FMCG business stands at around Rs 9,000 crore.
“We will enter anything and everything that can be classified as FMCG over a period of time,” Deveshwar told shareholders at the company’s AGM.
Saying that ITC was targetting to garner a business volume of Rs 1 lakh crore from FMCG business alone by 2030, Deveshwar said the company was investing heavily in brands to create consumer franchise in number of ways.
“The company has made relentless efforts in building world class brands, which had garnered an annual consumer spend of Rs 11,000 crore,” he said.
Deveshwar said ITC was not on the bottomline growth path but on the topline instead. “This is why the company is creating the brands of tomorrow,” he said.
On the cigarettes business, he said the regulatory environment was not entirely rational.
“I wonder some NGOs are acting as agents of overseas cigarette companies helping smuggling of cigarettes into the country. Smuggling of cigarettes are rising while the legal cigarette industry is losing volumes which is causing the Indian farmers to lose income”, he said.
“We are continuously engaging with governments both at the central and state levels and hopefully there will be some rationality next year,” he said.
Stating that ITC would be one of the most profitable FMCG companies in future, Deveshwar said the company was trying to build market position to make it ready for the future.
“Profits are not the only indicator of success. For instance e-commerce companies are losing cash as they are in the process of building market position. This is what ITC is doing by investing in brands,” he said.
Regarding investments, he said ITC was investing Rs 3,500 crore in West Bengal in two factories, infotech centre and one hotel.
The company is also investing Rs 6,000 crore at the Telengana paper mill to double capacity.
ITC was envisaging an outlay of Rs 25,000 crore across 65 projects in the country.
On Thursday, ITC Ltd has posted a subdued 3.61 per cent rise in net profit at Rs 2,265.44 crore for the first quarter ended June 30, due to pressure on cigarette sales and sluggish demand for other FMCG products.
Net sales, declined 7.18 per cent to Rs 8,505.53 crore for the quarter as against Rs 9,164.42 crore during June quarter of the previous fiscal, ITC said.