Company Profile
The company chosen for this research is the Indian multi-business conglomerate ITC limited. As of 2012-13 , ITC Limited had an annual turnover of US$8.31 billion and a total market capitalization of US$45 billion. It currently employs over 25,000 people.
ITC is one of India's foremost private sector conglomerate and is rated among the ‘World's Best Big Companies’, ‘Asia's Fab 50' and the ‘World's Most Reputable Companies’ by Forbes magazine . It’s among India's Most Respected Companies according to Business World Magazine and among India's Most Valuable Companies by Business Today Magazine . ITC ranks third in pre-tax profit among India's private sector corporations.
ITC has a diversified presence in Packaged Foods & Confectionery, Hotels, Branded clothing and Apparel, Greeting Cards, Packaging, Agricultural Business, Paperboards, Information Technology, Safety Matches and other FMCG products. ITC’s main business is the manufacturing and distribution of cigarettes .ITC holds more than 80 percent of India’s market share which is remarkable considering the large size of the country.
ITC's has adopted a porate strategy of creating multiple drivers of growth based on its core strengths of very wide distribution reach, efficient supply chain management, excellent brand development and world renowned service skills in hoteliering.
ITC's Agri-Business division is specifically noteworthy as it has been successful in exporting large quantities of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 2.8 billion in the last decade). This division’s 'e-Choupal' initiative has been instrumental in enhancing competitiveness of Indian farmers by using the Internet to create and enhance the rural distribution infrastructure and the division’s maketing reach.
ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is aggressively pursuing emerging opportunities in providing end-to-end IT solutions, including e-enabled services and business process outsourcing.
ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating.
ITC employs over 25,000 people at more than 60 locations across India. The Company has generated significant returns for its shareholders and is genarllay accepted as a socially responsible organization. However, ITC is the predominant cigarette manufacturer in India and its operations are often considered antithetical to social responsibility as cigarette consumption has a negative impact on public health.
Major Products and Brands
Foods: ITC's major food brands include Kitchens of India; Aashirvaad, Mint-o, gum-o, B natural, Sunfeast, Candyman, Bingo! and Yippee!. ITC is India's largest seller of branded foods with sales of over Rs. 4,600 crore in 2012-13 . It is present across 5 categories in the Foods business namely Staples, Snack Foods, Ready-To-Eat Foods, Juices and Confectionery.
Lifestyle apparel: ITC sells its products under the Wills Lifestyle and John Players brands. Wills Lifestyle was accorded the ‘Superbrand’ status and John Players was included in the top 10 ‘Most Trusted Apparel Brands 2012’ by The Economic Times.
Personal care products include perfumes, haircare and skincare categories. Major brands are Fiama Di Wills, Vivel, Essenza Di Wills, Superia and Engage.
Stationery: Brands include Classmate, PaperKraft and Colour Crew. Launched in 2003, Classmate went on to become India's largest notebook brand in 2007.
Safety Matches and Agarbattis: Ship, i-Kno and Aim brands of safety matches and the Mangaldeep brand of agarbattis (Incense Sticks).
Hotels: ITC's Hotels division (under brands including WelcomHotel) is India's second largest hotel chain with over 90 hotels throughout India ITC is also the exclusive franchisee in India of two brands owned by Sheraton International Inc. Brands in the hospitality sector owned and operated by its subsidiaries include Fortune Park Hotels and WelcomHeritage Hotels.
Paperboard: Products such as specialty paper, graphic and other paper are sold under the ITC brand by the ITC Paperboards and Specialty Papers Division like Classmate product of ITC well known for there quality
Packaging and Printing: ITC's Packaging and Printing division operates manufacturing facilities at Haridwar and Chennai and services domestic and export markets.
Information Technology: ITC operates through its fully owned subsidiary ITC Infotech India Limited, which is a SEI CMM Level 5 company.
Cigarette Brands
ITC Ltd sells 81 percent of the cigarettes in India, where 275 million people use tobacco products and the total cigarette market is worth close to $6 billion (around Rs.65,000 crore)
ITC's major cigarette brands include Wills Navy Cut, Marlboro Advance Black Gold Flake Kings, Gold Flake Premium lights, Gold Flake Super Star, Insignia, India Kings, Classic (Verve, Menthol, Menthol Rush, Regular, Citric Twist, Mild & Ultra Mild), 555, Silk Cut, Scissors, Capstan, Berkeley, Bristol, Lucky Strike, Players, Flake and Duke & Royal.[34][35
History
The company was founded as Wills, Watkins & Co. by Henry Overton Wills I and his partner Watkins, who opened a shop in Castle Street, Bristol in 1786. After the retirement of his partner in 1789 it became Wills & Co. From 1791 to 1793 the company was known as Lilly, Wills & Co when it merged with the firm of Peter Lilly, who owned a snuff mill on the Land Yeo at Barrow Gurney, and then, from 1793 to his retirement in 1803, as Lilly and Wills.
In 1826 his two sons, William Day Wills and Henry Overton Wills took over the company and in 1830 the company took the name W.D. & H.O. Wills. Tobacco was processed and sold under several brand names, some of which were still used by Imperial Tobacco until the second half of the 20th century such as Gold Flake introduced in 1878 and Woodbine ten years later. The company pioneered the use of cigarette cards within their packaging.
In 1901, thirteen British tobacco companies discussed the American Tobacco Company building a factory in the UK to bypass taxes. The Imperial Tobacco Company was incorporated on 10 December 1901 with seven of the directors being members of the Wills family. Imperial remains one of the world's largest tobacco companies.
In 1902, the newly formed Imperial Tobacco Company and the competing American Tobacco Company agreed to form a joint venture: the British-American Tobacco Company Ltd which remains a big player to this date as well as a minority shareholder in ITC.
In 1910, Imperial Tobacco formed the Imperial Tobacco Company of India.
The Company's beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. It was to mark the beginning of a long and eventful journey into India's future. The Company's headquarter building, 'Virginia House', which came up on that plot of land two years later, would go on to become one of Kolkata's most venerated landmarks.
In 1975, the company acquired a hotel in Chennai, which was renamed the 'ITC-Welcomgroup Hotel Chola' (now renamed to MyFortune, Chennai).
In 2000, ITC launched the Expressions range of greeting cards, the Wills Sport range of casual wear, and a wholly owned information technology subsidiary, ITC Infotech India Limited
In 2001, ITC introduced the Kitchens of India brand of ready-to-eat gourmet Indian recipes, which are produced and sold internationally, at first in cans and later in retort packages, and more recently on line and at festivals.
In 2002, ITC entered the confectionery and staples segmentsand acquired the Bhadrachalam Paperboards Division and the safety matches company WIMCO Limited.
ITC entered the incense sticks or agarbattis business in 2003, selling its products under the Mangaldeep brand.
ITC diversified into body care products in 2005.
In 2010, ITC launched its handrolled cigar – Armenteros – in the Indian market.
ITC owned "Chambal Agritech LTD" an Australian "Technico PTY" subsidiary in May, 2008, diversifying its business portal & to develop synergy between Seed Potato Production and Chip stock supply. later the name changed to "Technico Agri Sciences Ltd" wholly owned subsidiary of ITC Ltd.
Shareholding
ITC's equity shares are listed on Bombay Stock Exchange, National Stock Exchange of India and Calcutta Stock Exchange.[50][51] The company's Global Depository Receipts (GDRs) are listed on the Luxembourg Stock Exchange.[52]
The approximate break up of Shareholders (as on 31-March-2013 )
‘ Foreign companies (mainly British American Tobacco Company) 30.54%
‘ Foreign Institutional Investors (FII) 19.68%
‘ Banks, Financial Institutions, Insurance Companies and Mutual Funds 33.44%
‘ Bodies Corporate 04.91%
‘ Public and Others 10.59%
‘ GDRs 00.30%
Awards and recognitions
In 1994 and 1995, the ILTD Division in Chirala and Anaparti won the "Best of all" Rajiv Gandhi National Quality Award
ITC features on the Forbes Global 2000 rankings for 2012 at position 841. In the same rankings, the company's market value placed it as the 184th largest company in the world. Forbes has also included the company in Asia's Fab 50 Companies list.
In 2013, ITC was ranked the third most admired company in India by Fortune.
In 2011, all of ITC’s super premium luxury hotels were accorded LEED Platinum certification, making ITC Hotels the ‘Greenest Luxury Hotel Chain in the World’
In 2006, ITC's e-Choupal program won the Stockholm Challenge Award 2006 in the Economic Development category. This program enables over 3.5 million farmers to access crop-specific and customised information in their native village habitat and language.
In 2010, ITC was ranked 6th amongst global consumer goods companies in sustainable value creation during 2005-09, by Boston Consulting Group.
It received the National Award for Excellence in Corporate Governance from the Institute of Company Secretaries of India in 2007.
In 2014, The Brand Trust Report, published by Trust Research Advisory, a brand analytics company, ranked ITC in the 9th position among India's most trusted brands in the Diversified sector.