ITM Executive MBA, Batch Batc h 13B, Term Term 1, Subject: Concepts of Marketing
BCG Matrix of ITC Ltd. V0.2
Main Sources: ITC Portal (www.itcportal.com) , Angel Broking & NSE.
ITC Ltd. Formerly Known as Indian Tobacco Company Formerly Known as Imperial Impe rial Tobacco Tobacco Company
ITC Timeline
1925
1910
1910 1925 1975 1979 1990 2000 2000 2000
1975 1979
1990
2000
2008
Incorporation of 'Imperial Tobacco Tobacco Company of India I ndia Limited'. Setup of Packaging & Printing Business Launched its Hotels business. Entered the Paperboards business Set up the the Agri Business Business Division Division Launched a line of high quality greeting cards under the brand name 'Expressions' Entered the Lifestyle Lifestyle Retailing business with the Wills Sport. Spun off ITC Infotec Infotech h India Limited. Limited.
ITC Timeline
1910
2001 2005
2008
2007
Introduction of 'Kitchens of India' ready-to-eat ready-to-eat Indian gourmet dishes Launch of the brands mint-o mint-o and Candyman confectionery confectionery and Aashirvaad atta Started marketing popular safety matches brands like iKno, Aim Foray Foray into the marketing marketing of Agarbattis (Mangaldeep) Introduced Essenza Essenza Di Wills, an exclusive exclusive range of fine fragrances fragrances Entered the fast growing branded snacks category with Bingo!.
2007
Launched the 'Superia' range of Soaps and Shampoos in the mass-market segment.
2001 2002 2002 2003 2005
Corporate Governance Structure
ITC Ltd.
Agr Agrii Busin Busines ess s
FMCG-Cigarettes
Paperboards & Packaging
FMCG-Others
Infotech
Hotels
FMCG-Cigarettes Insignia, India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Berkeley, Bristol and Flake
'Best Manufacturer of Cigarettes for the year 2007'
FMCG-Cigarettes Started
in 1910 As Company¶s Core Business
Market leadership in all segments - geographic & price (70% Marke t
Share)
Extensive FMCG distribution network (Direct servicing of 1,00,000 marke ts & 2 million retail outlet)
Cigarettes account for only 15% of tobacco consumed in India unlike world pattern of 85% due to prolonged punitive taxation.
Of the 58% of adul t Indian males who consume tobacco, barely 15% can afford cigarettes. (Biri : Cigare ttes ratio = 10 : 1)
Annual
per capita adult cigarette consumption ion in Ind India ia world average which is 141
is app appx. x. one one tenth
In 2001 - Lost 15% of Its Business Because of Rise in Excise Duty
In 2007 - VAT Was charged at 12.5% which increased the price of cigare ttes by 84ps per cigare tte. Hence ITC had to shut down their business of Plains (i.e. Non Filter Cigarettes) which was 20% of total FMCG Cigare tte Business.
FMCG-Others Ashirvad Atta,
Kitchens Of India, Mint-o, Sunfeast, Candyman, Bingo, Superia, Wills LifeStyle, LifeStyle, Fiama Di Wills, Expressions, Classmate
µS uperbrand uperbrand
2006 µ µ - S uperbrand uperbrand Council.
FMCG-Others
Ashirvad Atta is now #1 selling.
Sunfeast
Biscuits is ranked #3.
Bingo, Bingo, launched launched in August 2007, now enjoys 16% marke ma rket share.
November 2007 Min t-o overtakes its competitor Chlormint
Classmate¶ br Classmate¶ bran and d alre alread ady y the the most most wide widely ly dist distri ribu bute ted d stat statio iona nary ry bran brand d in India
µ
Kitchens of India has about 48% marke t share in India and a huge expor t potential. Ready to Eat food Market is estimated to be Rs.700m.
Safety
Matches market at Rs. 1250 crores p.a. for 24 billion ma tch boxes which is targeted by ITC¶s ITC¶s iKno, Aim, Aim Mega, Aim Me Me tro. Successful
acquisition of 94% of WIMCO L td. i.e. Homelites,
µMangaldeep¶ the only Nationa ionall brand brand in 900cr incense sticks market.
the
Ship.
coun co untry serve serves s
the
nation¶s
Hotels ITC Maurya (Delhi), ITC Maratha (Mumbai), ITC Grand Central (Mumbai), ITC Sonar (Kolkatta), ITC Windsor (Bengaluru), ITC Kakatiya (Hyderabad), ITC Mughal (Agra).
µ Bukhara¶ Bukhara¶
Restaurant named as Best Indian Restaurant Res taurant in the World.
Hotels
Hotel Brands: ITC-WelcomGroup, WelcomHeritage & Fortune.
Totally 90 Hotels, 77 Des tinations and 5500 Rooms under management.
Destinations include most of India as well as
Singapore
and Dubai.
Hosted a galaxy of world dignitaries like Bill Gates Condoleezza Rice to Benazir Bhutto.
Restaurant Brands: Bukhara, Dum Pukht and Dakshin.
to
Bill Clinton,
Agri Business eChoupal, Agri Exports, Leaf Tobacco
Innovation for India Award 2006 for ITC e-Choupal in the S ocial ocial Innovations category for business organizations
Agri Business ITC Agr Agri Busines ess s is on one e of India¶s a¶s larg argest exporter of agricultural commodities.
June 2000, eChoupal ± s trategic and cost effective sourcing support to the Foods business (support creation of verticals in wheat, soya, corn, potato etc.)
eChoupal - Services reaches to 4 million Farmers who are growing Whea t, Rice, Pulses, Soyabean, Coffee in over 40,000 villages thru nearly 6,500 kiosks across nine states.
Diverse range of goods/services : FMCG, consumer durables, agri-inpu ts.
Farmer Financial Services - insurance (focus: weather), credit (focus: (focus: Kisan credit card scheme)
Rural Retail ± 18 Choupal
Sagars
Agenda 2012 is to cover 15 s tates with 1,00,000 Villages wi th about 20,000 eChoupal Kiosks servicing abou t 10 million farmers.
Agri Business Business ± Leaf Leaf Tobac Tobacco co (IL (ILTD)
Largest Buyer, Processor and Expor ter of leaf tobacco in India.
Exports to about 48 countries.
ITC processes about 120 million kgs of high quali ty tobacco yearly. Overall 550m Kg of tobacco is produced in India.
Factories have integrated warehousing complexes.
Enabled successful venture into spices business.
Golden Leaf Awards 2007 in the categories µMost Committed to Quality¶
The International Quality Rating Norske Veritas in March 2006.
System
± IQRS Level 7, awarded by De t
Packaging & Paperboards Paperboards Packaging
& Paperboards and Specialty Paper
Indian Manufacturing Excellence Gold Award 2007 and 2006 to Unit Bollaram by Frost & S ullivan ullivan
Packaging & Paperboards Paperboards
Annual paperboard demand ± appx. 1.1 million tonnes
Indian paperboard marke t growing at 7% p.a.
Significant
export opportunities for high quali ty Indian manufacturers ITC paperboards expor ts - Rs. 2 billion appx.
ITC¶ ITC¶s s packag packaging ing unit - India India¶¶s large larges st converter of paper paperbo boar ard d into high quality prin printed packaging
Provide Provides s superi superior or packag packaging ing sol solu utions businesses
to the
ciga cigare rettes and and new new FMCG MCG
India has low per capita usage at around 6 kgs p.a. (World average ± over 50 kgs p.a.)
ITC Bought 0.5% in Ballarpur Industries in July 2008.
Infotech ITC Infotech Ltd.
Featured amongst Top Top 100 Global Outsourcing Companies in the Leaders category category - International International Association Association of Outsourcing Professionals
Infotech
ITC Infotech Ltd. Is a wholly owned subsidiary of ITC L td.
ITC ITC Info Infotec ech h is respo respons nsib ible le for for deve develo lopi ping ng & main maintaining eChoupal infrastructure.
the
entire ire ITC ITC
Although a separate entity and brand, ITC Info tech¶s primary job is to keep ITC as a group up to date with latest technology.
BCG Matrix BCG Matrix a.k.a. Grow th-Share Matrix, Boston Box, Boston Matrix, Boston Consulting Group analysis.
Created by Bruce Henderson for the Boston Consulting Group in 1970 to help corporations with analyzing their business units or product lines.
This helps the company allocate resources and is used as an analy tical tool in brand marketing, product management, strategic management, and portfolio analysis.
BCG Matrix
BCG Matrix
ITC Ltd on BCG Matrix
G R O W T H
Star
Question mark
Cash Cow
Dog
MARKET SHARE
Summary on ITC¶s SBUs
Growth-Share Matrix
REVENUES Y/E March (Rs cr) FMCG-Cigarettes FMCG-Others Hotels Agri Business Paperboards & Packaging ITC Infotech
% % FY2008 FY2007 Growth Contrib. % Market Share 13,825.6 12 12,833.7 7 .7 58.41 70% 2,511.1 1,689.5 48.6 10.61 16% 1,100.2 985.7 11.6 4 .6 5 90 Hotels 2nd Largest 3,868.4 3,501.3 10.5 16.34 Exporter 2,364.3 2,100.1 -
12.6 -
9 .9 9 -
1st in Asia -
Growth Share L ow High High Low High High High
High
High L ow
High Low
ITC Ltd on BCG Matrix (Conclusion)
G R O W T H
Star
Question mark
Agri Business Hotels Paperboards & Packaging
FMCG-Foods
Cash Cow
Dog
FMCG-Cigarettes
ITC Infotech
MARKET SHARE
THANK YOU
