ITC, which launched more than 50 new fast-moving consumer goods (FMCG) products across categories during last fiscal to strengthen its offerings, has said Aashirvaad is now over Rs 4,500-crore brand in terms of annual consumer spend with the diversified conglomerate expanding the brand into new segments.
Its Sunfeast has become an over `3800-crore brand, while Bingo! is now nearly a 2,500-crore brand. Along with Aashirvaad, Sunfeast and Bingo! remain leading brands from ITC’s stable. Currently , Aashirvaad is numero uno in branded atta, Bingo! is No. 1 in snack foods sub-segment (No.2 overall), while Sunfeast is No. 1 in the cream biscuits segment. The company’s portfolio of brands in new FMCG business represents an annual consumer spend of over Rs 18,000 crore in aggregate.
ITC is a leading FMCG marketer in India and its non-cigarette or new FMCG business includes branded packaged foods, personal care products, education & stationery products and agarbatti, among others. The Kolkata-based cigarette-to-hotel major has built 25 mother brands in rapidly growing new FMCG business vertical.
“Today, the mature businesses are leaders in their segments whilst the newer businesses are making appreciable progress. Given the emergent opportunities in a relatively fast growing economy like India, each of our businesses holds immense promise for the future. This potential is even greater in our newer businesses like FMCG where there is considerable headroom to grow,” Sanjiv Puri, ITC’s chairman and managing director, said in the company’s latest annual report.
“As a new government takes office with a resounding mandate from the people of India, we are confident and optimistic that their proactive endeavours to create structural drivers of rapid growth will augur well for the economy,” Puri said, adding his company was well poised to benefit from the anticipated acceleration in the growth trajectory.
Puri was appointed as the company’s chairman last month, two days after its longest-serving chairman Y C Deveshwar passed away.
In the annual report for the financial year 2018-19, published on Thursday, Puri said it was the company’s aspiration to be a leader in every business segment that it operated in and be acknowledged as a trusted provider of best-in-class products and services.
“Towards this, our relentless focus on building international competitiveness in each business will be supported by appropriate investments not only to reinforce the pole position that we have achieved in several segments but also to speedily attain leadership in the newer businesses. While this will undoubtedly entail upfront investments and gestation costs in the short term, particularly in the non-cigarette FMCG businesses, such investments will be a source of competitive advantage and create sustained value for stakeholders over the medium to long term as our brands garner larger scale and deepen their connect with consumers,” he added.
During the last financial year, the conglomerate strengthened its milk procurement network for Aashirvaad Svasti dairy products with significant increase in daily milk collection. The Aashirvaad Svasti portfolio was augmented with the introduction of pouch curd and paneer. During the year, the business expanded its milk sourcing network to Kolkata for fresh dairy products and to Punjab for meeting the requirement of dairy beverages under the brand Sunfeast Wonderz.
The company also augmented its portfolio in the rapidly growing cakes segment through the launch of layered cakes under the Sunfeast Bounce brand and expanded the offerings in the Marie & Cookies segment with the launch of Sunfeast Marie Light Vita & Sunfeast Mom’s Magic Choco Chip cookies.
Aashirvaad atta fortified its market standing across geographies and its leadership position in the industry, the company said. Variants in the value-added portfolio such as multigrain atta and select atta continues to record robust growth, driven by higher salience in modern trade and e-commerce channel.
“Your company had to contend with increased competitive intensity post the implementation of 5% GST on branded atta. While it has been the government’s intention to provide relief of nil rate of GST only to small and local manufacturers, thereby benefiting consumers with lower priced staple products, many manufacturers have used this distinction in rates as an attractive tax-evasion/avoidance opportunity by classifying their products as unbranded or with a declaration that ‘we hereby voluntarily forego all types of actionable claim or enforceable right in respect of brand name printed on this pack’ and continue to market the product with brand names and distinct trademarks. This inequitable GST differential between branded and unbranded players has resulted in market distortion, widening the price gap between national registered brands and local unregistered brands,” the annual report stated.
During the last fiscal, Bingo! range of snacks recorded robust growth, driven by new product launches, portfolio renovation and extensions, expansion of distribution footprint, tailor-made trade marketing support and consistent and impactful communication.
“Bingo! sustained market leadership in the bridges segment and Tedhe Medhe emerged as India’s most distributed brand in the category,” the company claimed.
ITC said its leadership in production of early generation seed potatoes and strength in agronomy continued to support the ‘Bingo!’ range of potato chips.