ITC's Product

1. Presented by:
Prakhar Omar
PIBM, Pune
2017-19
Analysis On
ITC: Be Natural
prakharomar05@gmail.com
www.linkedin.com/in/prakhar-omar-b24158129
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2. FMCG Sector is the 4th largest sector in the Indian economy with Household and Personal
Care accounting for 50% of FMCG sales in India.
Market size of around US$ 29.4 billion in 2016-17.
The Retail market in India is estimated to reach US$1.1 trillion by 2020 from US$ 672 billion
in 2016, with modern trade expected to grow at 20% - 25% per annum.
In 2016-17, Revenue for FMCG sector have reached by expectations of total consumption
expenditure reached US$ 49 billion and is expected to grow at 9% – 9.5% in FY18 supported
by expectation of the total consumption expenditure reaching nearly US$ 3,600 billion by
2020 from US$ 1,469 billion in 2015.
 The Goods and Service Tax (GST) is beneficial for the FMCG industry as many of the
FMCG products such as Soap, Toothpaste and Hair Oil now come under 18% tax bracket
against the previous 23% - 24% rate.
FMCG: INFORMATION

3. 49
103.7
0
50
100
150
2016 2020F
CAGR 20.6%
FMCG Market in India (US$ billion)
Rural FMCG Market in India (US$ billion)
FMCG: MARKET IN INDIA
29.4
100
0
50
100
150
2016 2020F
CAGR 14.6%
 Favorable demographics and rise in income level
to boost FMCG market.
 FMCG market in India is expected to grow at a
CAGR of 20.6%, and reach US$ 220 billion by
2025 from US$ 49 billion in 2016.
Rise in rural consumption to drive the FMCG
market.
The rural FMCG market in India is expected to
grow at a CAGR of 14.6%, and reach US$ 2220
billion by 2025 from US$ 29.4 billion in 2016.

4. FMCG: PORTER’S FIVE ANALYSES
Bargaining Power of Suppliers
 Diverse distribution channel
 Large number of substitute inputs
 Low cost of switching suppliers
 Input have little impact on costs
 Volume is critical to suppliers
Threat of Substitutes
 Limited number of substitute
 Substantial product
differentiation
Barriers to Entry
 Strong distribution
network required
 Geographic factors
limit competition
 Strong brand name is
important
 High Capital
requirements
 Patents limit new
Intensity of Rivalry
 Government limits
competitors
 Low storage cost
 Large industry size
 Relatively few
competitors
 Exit barriers are
low
Bargaining Power of Suppliers
 Diverse distribution cannel
 Large number of substitute inputs
 Low cost of switching suppliers
 Input have little impact on costs
 Volume is critical to suppliers

5. FMCG
Household
Care
Personal Care
Food &
Beverages
Health Care
Oral Care, Hair
Care, Skin
Care,
Cosmetics/Deo
dorants,
Perfume,
Feminine
Hygiene and
Paper Products
Health Beverages,
Staples/Cereals,
Bakery Products,
Snacks,
Chocolates, Ice
Cream,
Tea/Coffee/Soft
Drinks, Processed
Fruits and
Vegetables, Dairy
Products and
Branded Flour
OTC
Products
and
Ethical
Fabric
Wash,
Household
Cleaners
FMCG: MAJOR SEGMENTS
Food and
Beverages
53%
Personal
Care
20%
Tobacco
15%
Househo
ld Care
10%
Lighting
2%

6. ITC: INTRODUCTION
ITC limited was started in 1910 as a Tobacco company which later diversified into a pool of
other products, It is the market leader in cigarettes in India.
ITC is the 4th largest illegal cigarettes markets in the world. Where legal cigarettes accounts
for only 11% of total tobacco consumption in India, ITC captured this 11% legal market with
81% market share (as of March 2017).
ITC is India’s one of the leading company in the agricultural sector and one of the largest
exporters of agri commodities.
e-Choupals servicing more than 4 million farmers, leveraging the critical agriculture market
of India and raised the farm incomes, improve the quality of life of the rural population and
transforming village ecosystems.

7. ITC: OPRETION

8. ITC: PORTFOLIO
Name and Description of main
Products / Services
Gross
Turnover
as a % of
total
turnover
Gross
Turnover
as a % of
total
turnover
1 FMCG
-Cigarettes etc 61.82 46.77
-Branded Packaged Food Products 14.61 20.59
-Others ( Apparel, Education and
Stationary products, Personal care
products, safet matches, Agarbattis)
4.48 6.25
2 Hotels 2.42 3.41
3 Agri Business (wheat, Soya, Spices,
Coffee, Unmanufactured Tobacoo
etc).
9.73 13.73
4 Paperboards, Paper & Packaging
-Paperboards and Paper 5.85 7.76
-Printed Material 1.09 1.49

9. ITC: PRODECTS & SERVICES
Agri-Business:
 No.1 in profitability
 Pioneer in Rural
Transformation through
 ITC e-Choupal One of the
largest exporters of coffee
FMCG Businesses:
 India’s leading marketer
 ITC Foods is the 3rd largest
and fastest growing
Hotels:
 ITC Hotels is world’s
greenest luxury hotel chain
 One of the fastest growing
hospitality chains in India
Paperboards & Packaging:
 Market Leader in Revenue & Profits
 Most environment friendly pulp mill in Asia
 Sustained investments to enhance
competitiveness and import substitution
 Large-scale Afforestation programme
Information Technology:
 Digital Full Services Global
Player
 9 Development Centers

10. ITC: PRODECTS & SERVICES

11. ITC: PERFORMANCE
S. No. RATIO FORMULA SOULUTION NET RESULT
1. Current Ratio Current Assets/Current
Liability
24,537.39/6,830.07 3.59:1
2. Gross Profit Margin Gross Profit*100/Net Sales 37,027.85*100/55448.46 66.77%
3. Net Profit Net Profit*100/Net Sales 10,200.90*100/
55,448.46
18.39%
4. Working Capital Current Assets-Current
Liability
(24,537.39)-(6,839.07) 17,698.32
5. Debt-Equity Ratio Debt/Equity 8,591.18/45,346.96 0.189
6. Turn Over Ratio COGS*100/Net Sales 18,420.61*100/55448.46 33.22
7. EPS PAT/No. of equity share 1,02,00,90,00,000/12,14,73,83,071 8.40
8. ROI PAT/Total Investment*100 10,200.90/18,585.29*100 54.88

12. ITC: PERFORMANCE
Particulars FY 17 FY 16
Common Size
Analysis 2017
Common Size
Analysis 2016
Comparative Analysis
2017
Incomes
Revenue From Operations 55448.46 51944.57 100.00% 100.00% 6.74%
Other Income 1985.91 1769.26 3.58% 3.40% 12.24%
Total Income (I+II) 57434.37 53713.83 103.58% 103.40% 6.92%
EXPENSES
Cost of materials consumed 11765.56 11054.75 21.21% 21.28% 6.42%
Purchases of Stock-in-Trade 3566.57 2591.80 6.47% 4.98% 37.60%
Changes in inventories of finished goods, Stock-in-
Trade, work-in-progress and intermediates
644.17 (196.55) 1.17% (0.37)% (427.73)%
Excise duty 15359.78 15361.90 27.70% 29.57% (0.01)%
Employee benefits expense 2444.31 2331.59 4.40% 4.48% 4.83%
Other expenses 7090.03 7086.46 12.78% 13.64% 0.05%
Total expenses 40870.42 38229.95 73.70% 73.59% 6.90%
EBITDA 16563.95 15483.88 29.87% 29.80% 6.97%
Depreciation and amortization expense 1038.04 1000.68 1.87% 1.92% 3.73%
EBIT 15525.91 14483.2 28.00% 27.88% 7.19%
Finance costs 22.95 49.13 0.041% 0.09% (53.28)%
PBT 15502.96 14434.07 27.95% 27.78% 7.40%
Current Tax 5285.65 4896.06 9.53% 9.42% 7.95%
Deferred Tax 16.41 209.64 0.02% 0.40% (92.17)%
Net Tax 5302.06 5105.70 9.56% 9.82% 3.84%

13. Board of Directors
Audit
Committee
CSR and
Sustainability
Committee
Nomination &
Compensation
Committee
Security Holders
Relationship
Committee
Independent
Directors
Committee
Corporate Management Committee
Divisional/Strategic Business Unit (SBU)
Management Committee, each headed by a
divisional/ SBU Chief Executive
Business includes: FMCG, Hotels,
Paperboards, Specialty Papers & Packaging,
Agri Business and Information Technology
Corporate Functions, each headed by a HOD
Corporate Functions include: Panning and
Treasury, Accounting Taxation, Accounting,
Taxation, Risk Management, Legal, Secretarial,
EHS, Human Resources, Corporate
Communications, Corporate Affairs, Internal
Audit and Research & Development
ITC: ORGANIZATION STRUCTURE

14. BE NATURAL: MARKETING MIX
PRODUCT
 Mix fruit juice with wide variety of
flavors.
 Six-layer Tetra Pak packaging.
 Approved by FSSA.I
 No added sugar, added color,
artificial, flavor, preservatives.
PLACE
 Super markets
 Hyper markets
 Departmental stores
 Specialty stores and
 E- commerce sites
PRICE
 200 ml pack size: Rs 20/-
 1 Lt. pack size: Rs 99/-
 1 Lt. Jamun Joy: Rs 149/-
 1 Lt. 100% Pomegranate: Rs 199/-
PROMOTION
 Advertising
 Public relations
 Social media marketing
 Search engine marketing
 Video marketing and more

15. Entered into the Rs 2500 cr. juices and
nectars market in 2015
In 2 years, established itself as the clear
No.3 player
Acquired market share of about 6.9%
B Natural over the period of time has
gain great popularity
Product has so far reached the growth
stage
BE NATURAL: PLC

16. BE NATURAL: SWOT
• Switching costs are
low
• Threat from
substitutes like fruit
juices
• People prefer
products made from
natural ingredients
• Adventure into rural
markets
• Established players
already exists
• More or less a
premium product
• 13 variants of
different flavor
• Strong Brand name
of ITC
• Natural ingredients
enhance trust in
brand S W
TO

17. THANK YOU!!