ITC LTD Format 15

ITC Limited Personal Care
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1. Organizational Profile ITC is one of India's foremost private sector companies with a market capitalisation of nearly US $ 19 billion and a turnover of over US $ 5 billion.* ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by BusinessWorld and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week. ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery. As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman Y.C. Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC employs over 26,000 people at more than 60 locations across India. The Company continuously endeavours to enhance its wealth generating capabilities in a globalising environment to consistently reward more than 3,41,000 shareholders, fulfil the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder." (The ITC Profile 2009)
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2. History and Evolution ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. As the Company's ownership progressively Indianised, the name of the Company was changed from Imperial Tobacco Company of India Limited to India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In recognition of the Company's multi-business portfolio encompassing a wide range of businesses Cigarettes & Tobacco, Hotels, Information Technology, Packaging, Paperboards & Specialty Papers, Agri-business, Foods, Lifestyle Retailing, Education & Stationery and Personal Care - the full stops in the Company's name were removed effective September 18, 2001. The Company now stands rechristened 'ITC Limited'. 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. This decision of the Company was historic in more ways than one. 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. Though the first six decades of the Company's existence were primarily devoted to the growth and consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the beginnings of a corporate transformation that would usher in momentous changes in the life of the Company. ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's Cigarettes business. It is today India's most sophisticated packaging house. In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennai which was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of ITC's entry into the hotels business was rooted in the concept of creating value for the nation. ITC chose the hotels business for its potential to earn high levels of foreign exchange, create tourism infrastructure and generate large scale direct and indirect employment. Since then ITC's Hotels business has grown to occupy a position of leadership, with over 100 owned and managed properties spread across India. In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited, which today has become the market leader in India. Bhadrachalam Paperboards amalgamated with the Company effective March 13, 2002 and became a Division of the Company, Bhadrachalam Paperboards Division. In November 2002, this division merged with the Company's Tribeni Tissues Division to form the Paperboards & Specialty Papers Division. ITC's paperboards' technology, productivity, quality and manufacturing processes are comparable to the best in the world. It has also made an immense contribution to the development of Sarapaka, an economically backward area in the state of Andhra Pradesh. It is directly involved in education, environmental protection and community development. In 2004, ITC acquired the paperboard manufacturing facility
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of BILT Industrial Packaging Co. Ltd (BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC to improve customer service with reduced lead time and a wider product range. In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. Since inception, its shares have been held by ITC, British American Tobacco and various independent shareholders in Nepal. In August 2002, Surya Tobacco became a subsidiary of ITC Limited and its name was changed to Surya Nepal Private Limited (Surya Nepal). In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major supplier of tissue paper to the cigarette industry. The merged entity was named the Tribeni Tissues Division (TTD). To harness strategic and operational synergies, TTD was merged with the Bhadrachalam Paperboards Division to form the Paperboards & Specialty Papers Division in November 2002. Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for export of agri-commodities. The Division is today one of India's largest exporters. ITC's unique and now widely acknowledged e-Choupal initiative began in 2000 with soya farmers in Madhya Pradesh. Now it extends to 10 states covering over 4 million farmers. ITC's first rural mall, christened 'Choupal Saagar' was inaugurated in August 2004 at Sehore. On the rural retail front, 24 'Choupal Saagars' are now operational in the 3 states of Madhya Pradesh, Maharashtra and Uttar Pradesh. In 2000, ITC forayed into the Greeting, Gifting and Stationery products business with the launch of Expressions range of greeting cards. A line of premium range of notebooks under brand Paperkraft was launched in 2002. To augment its offering and to reach a wider student population, the popular range of notebooks was launched under brand Classmatein 2003. Classmate over the years has grown to become Indias largest notebook brandand has also increased its portfolio to occupy a greater share of the school bag. Years 2007- 2009 saw the launch of Children Books, Slam Books, Geometry Boxes, Pens and Pencils under the Classmate brand. In 2008, ITC repositioned the business as the Education and Stationery Products Business and launched India's first environment friendly premium business paper under the Paperkraft Brand. Paperkraft offers a diverse portfolio in the premium executive stationery and office consumables segment. Paperkraft entered new categories in the office consumable segment with the launch of Textliners, Permanent Ink Markers and White Board Markers in 2009. ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded its range to include Wills Classic formal wear (2002) and Wills Clublife evening wear (2003). ITC also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills Lifestyle India Fashion Week - that has gained recognition from buyers and retailers as the single largest B-2-B
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platform for the Fashion Design industry. To mark the occasion, ITC launched a special 'Celebration Series', taking the event forward to consumers. In 2007, the Company introduced 'Miss Players'- a fashion brand in the popular segment for the young woman. In 2000, ITC spun off its information technology business into a wholly owned subsidiary, ITC InfoTech India Limited, to more aggressively pursue emerging opportunities in this area. Today ITC InfoTech is one of Indias fastest growing global IT and IT-enabled services companies and has established itself as a key player in offshore outsourcing, providing outsourced IT solutions and services to leading global customers across key focus verticals - Manufacturing, BFSI (Banking, Financial Services & Insurance), CPG&R (Consumer Packaged Goods & Retail), THT (Travel, Hospitality and Transportation) and Media & Entertainment. ITC's foray into the Foods business is an outstanding example of successfully blending multiple internal competencies to create a new driver of business growth. It began in August 2001 with the introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the confectionery and staples segments with the launch of the brands mint-o and Candy man confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the Company entered the biscuits segment. ITC's entered the fast growing branded snacks category with Bingo! In 2007. In just seven years, the Foods business has grown to a significant size with over 200 differentiated products under six distinctive brands, with an enviable distribution reach, a rapidly growing market share and a solid market standing. In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro. ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of its partnership with the cottage sector. ITC's popular agarbattis brands include Spriha and Mangaldeep across a range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and Nagchampa. ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath & body care products for men and women in July 2005. Inizio, the signature range under Essenza Di Wills provides a comprehensive grooming regimen with distinct lines for men (Inizio Homme) and women (Inizio Femme). Continuing with its tradition of bringing world class products to Indian consumers the Company launched 'Fiama Di Wills', a premium range of Shampoos, Shower Gels and Soaps in September, October and December 2007 respectively. The Company also launched the 'Superia' range of Soaps and Shampoos in the mass-market segment at select markets in October 2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range of shampoos in June 2008. (History and Evolution n.d)
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3. Product Profile ITC: Touching Your Lives Everyday
Paperboards, FMCG Hotels Speciality Paper, Packaging Agri Business Information Technology
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3.1 Personal Care Products

In line with ITC's aspiration to be India's premier FMCG Company, recognised for its world-class quality and enduring consumer trust, ITC forayed into the Personal Care business in July 2005. In the short period since its entry, ITC has already launched an array of brands, each of which offers a unique and superior value proposition to discerning consumers. Anchored on extensive consumer research and product development, ITC's personal care portfolio brings world-class products with clearly differentiated benefits to quality-seeking consumers. ITC's Personal Care portfolio under the 'Essenza Di Wills', 'Fiama Di Wills', 'Vivel Di Wills' 'Vivel UltraPro', 'Vivel' and 'Superia' brands has received encouraging consumer response and is being progressively extended nationally. ITC's state-of-the-art manufacturing facility meets stringent requirements of hygiene and benchmarked manufacturing practices. Contemporary technology and the latest manufacturing processes have combined to produce distinctly superior products which rank high on quality and consumer appeal. Extensive insights gained by ITC through its numerous consumer engagements have provided the platform for its Research and Development and Product Development teams to develop superior, differentiated products that meet the consumer's stated and innate needs. The product formulations use internationally recognised safe ingredients, subjected to the highest standards of safety and performance. (Personal Care n.d)
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3.1.1 Vivel Between February and June 2008, ITC expanded its personal care portfolio with the launch of Vivel Di Wills and Vivel brands. Vivel Di Wills, a range of soaps, and Vivel, a range of soaps and shampoos, cater to the specific needs of a wide range of consumers. Vivel Di Wills and Vivel are high quality ranges of soaps and shampoos for the upper-mid and mid-market consumer segments. All products offer a unique value proposition of bringing together ingredients that provide the benefit of Nourishment, Protection and Moisturisation through one product, hence providing the ever discerning consumer complete care, which makes her beautiful and confident. The Vivel Di Wills range of Soaps is available in two variants. Vivel Di Wills Sheer Radiance is enriched with Olive Oil, to provide skin lustre to make it radiant. Vivel Di Wills Sheer Crme is enriched with Shea Butter, to moisturize skin to make it soft and supple.
The Vivel range of soaps is available in five variants: Vivel Young Glow is enriched with Vitamin E and Fruit Infusions which help in providing youthful glow to the skin. Vivel Satin Soft is enriched with Vitamin E and Aloe Vera which help the skin feel beautifully soft. Vivel Sandal Sparkle is enriched with Sandalwood Oil and Active Clay which helps in providing clear skin. Vivel Ayurveda Essence is enriched with multiple Ayurvedic Ingredients which help protect skin from germs and harsh environment, keeping it healthy and beautiful. Vivel Silk Spring is enriched with Green Apple extracts and Olive oil which help in making skin smooth.
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The Vivel range of shampoos is available in three variants: Vivel Shine & Glow is suitable for dull to normal hair and is enriched with Green Tea Extract and Conditioners. It adds shine to hair. Vivel Soft & Fresh is suitable for dry to normal hair and contains Extra Conditioners and Soya Protein. It makes hair soft and fragrant. Vivel Volume & Bounce is suitable for oily to normal hair and contains Jojoba Oil and Conditioners. It adds volume and bounce to hair.
The product portfolio was further enhanced with the launch of Ultrapro anti-dandruff shampoo under the umbrella brand Vivel in December 2008. Ultrapro promises to fight dandruff twice as effectively while also providing care for hair through the plus benefits of Nourishment and Moisturisation. (Vivel Portfolio n.d)
3.1.2. Fiama Di Wills In September 2007, ITC launched Fiama Di Wills, a premium range of personal care products comprising shampoos, conditioner, shower gels and bathing bar. The Fiama Di Wills range combines the goodness of nature and science, providing gentle and effective care. The Fiama Di Wills product portfolio has been developed by scientists at the ITC R&D Centre, leveraging the expertise of International product formulation specialists. The fragrances, aesthetics and packaging have been developed in collaboration with European specialists. Fiama Di Willss products are targeted at the young, modern, aware customers who are confident of themselves and seek indulgences that make them feel alive and beautiful. The range combines exotic naturals like Sage, Watercress, Magnolia blossoms and the best of contemporary science like Hydro Restorative System and Cuticle Restore Technology to make the consumer feel beautiful, today, tomorrow. Fiama Di Wills Shampoos developed in collaboration with Cosmetech Labs Inc., USA, offer a range of five variants. Each of these is designed to deliver a specific hair benefit to the consumer : Everyday Mild (with extracts of Thyme & Juniper) is a gentle caring shampoo suitable for regular use. Aqua Balance (with extracts of Magnolia Blossoms & Watercress) is a gentle moisturizing shampoo ideal for dry, dull hair.
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Volume Boost (with extracts of Rosemary & Sage) is a gentle volumizing shampoo ideal for thin, limp hair. Silky Strong (with oils of Macadamia Nut and Babassu) helps make hair smooth, silky and strong and is ideal for weak, damaged hair. Shine in Style (with extracts of Chamomile and Green Tea) makes hair shiny and manageable, easy to style and is ideal for dull to normal hair.
Each of these shampoos can be complemented with Fiama Di Wills Polishing Drops conditioner. This gentle conditioner enriched with Avocado Oil and Burdock extract promises to make hair shiny, soft and smooth. It also gives the additional benefits of UV protection as it contains Sunflower Seed extract, which is a natural UV absorber. The Fiama Di Wills product line also consists of a 3-variant range of transparent shower gels which are unique as they come with suspended beads: Mild Dew (contains soft beads, extracts of peach and avocado) is for soft, moisturized skin. Clear Springs (contains jojoba beads, extracts of sea weed and lemongrass) is for clear, healthy, smoother skin. Exotic Dream (contains glitter beads, extracts of bearberry leaves and black currant) is for stimulating freshness.
The Fiama Di Wills range of bathing bars has been launched under the sub - brand Skin Sense. The first variant to be introduced in this range is Soft Green. This is a gentle caring bathing bar, that helps enhance retention of skin proteins giving 6 pro cares. Protein keeps skin moisturised, supple, youthful, even toned, radiant and smooth. Fiama Di Wills recently launched a range of transparent gel bathing bars. A first of its kind, a transparent liquid gel has been solidified into a bathing bar so that consumers get a superior bathing experience. The shower gel in a bathing bar format which has been crafted through a unique and patented freezing technology. Backed by deep consumer insights, this proprietary gel bathing bar is a result of years of extensive research and development by the scientists at the ITC R&D Centre. Uniquely crafted, these Gel Bathing Bars are shaped like dew drops, have a transparent look, rich creamy lather, and a great long-lasting fragrance. These bathing bars are dermatologic ally tested and proven mild and contain the goodness of natural exotic extracts like Peaches, Avocadoes, Sea Weed and lemongrass. Launched in two variants that offer specific different skin benefits, are:
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Mild Dew - Contains extracts of peach and avocado which moisturise the skin Clear Springs - Contains extracts of lemongrass & sea weed which gives Clear skin
The Fiama Di Wills transparent Gel Bathing Bars are available at an attractive price of Rs. 25 for 110 grams. This differentiated range of bathing bars offers the consumer a delightful bathing experience. Fiama Di Wills has expanded its range of personal care products by introducing Aqua Pulse shower gel, exclusively for men. The shower gel contains extracts of exotic naturals like sea minerals and blue lotus. This blue transparent shower gel refreshes and keeps skin healthy. (Fiama Di Wills n.d)
3.1.3. Essenza Di Wills ITC launched an exclusive line of prestige fine fragrances under the Essenza Di Wills brand in mid 2005. Essenza Di Wills is an exclusive range of fine fragrances and bath & body care products for women and men. Inizio - the signature range from Essenza Di Wills, provides a comprehensive grooming regimen with distinct lines for women (Inizio Femme) and men (Inizio Homme). The rich and sensual international fragrances of Essenza Di Wills are all-day offerings created by leading French fragrance houses. The range includes a host of bath & body care products that share the same olfactory signature to offer a harmonised fragrance experience. Aqua - The Essenza Di Wills portfolio was enhanced with the Aqua range for men (Aqua Homme) offering a distinctive and fresh aquatic fragrance. It embodies the essence of stylish and confident man. The fragrance note revolves around "Citrus Aromatic Musky". The alliance of bergamot mandarin &Italian lemon which stimulates and re-energizes the mind. The top notes are blended with a spicy aromatic heart which burst with the energy of French rosemary, Clary sage & Tonka beans arousing vigour & pure masculinity. This is further enhanced with musky end notes which reveal the warmth of amber and vanilla creating a discreet refinement that can never go out of style. The Aqua range includes Eau De Toilette, Hair & Body Shampoo, Deodorant Spray, After Shave Lotion and a Bathing Bar.
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Mikkel - The latest addition to the Essenza Di Wills portfolio is the enigmatic 'Mikkel' that embodies a fine balance between Mystery and Elegance. The fragrance is specially suited for evening wear. The sharp Lavender and Bergamot top notes blend sophistication with a hint of mystery. At the heart, sensual Neroli and serene Orange Blossom dance to an effortless tune of elegance. The rich and passionate undertones of Vanilla delicately bring out the aroma of Amber, creating an unmistakable aura. Mikkel Homme Eau De Toilette and After Shave Lotions are available exclusively at Wills Lifestyle stores. (Essenza Di Wills n.d)
3.1.4. Superia The Superia range of soaps and shampoos has been launched to cater to the large popular market in the personal care category. The products under the Superia brand are made from scientifically developed formulations enriched with natural ingredients that have traditionally been known to be good for the skin and hair. The range offers consumers access to some of the best-in-class products in vibrant attractive packaging. Superia Soaps are available in four variants: Fragrant Flower: with the fragrance of Rose & Lavender Oil Soft Sandal: with the fragrance of Sandal & Almond Oil Natural Glow: with Neem & Coconut Oils Healthy Glow: with Orange Oil
Superia shampoos with triple conditioners and natural ingredients bring a natural shine to hair. Superia shampoos are available in two variants: Shiny Black with Triple Conditioners and the Hibiscus & Brahmi extracts. Vibrant Green with Triple Conditioners and the Amla & Arnica extracts. natural goodness of natural goodness of
Another addition to the Superia shampoo portfolio, Superia Maxi Protect Active Health shampoo contains Dandruff Fighter along with Vitamins & Soya Protein. It fights multiple types of dandruff causing germs and leaves hair & scalp feeling clean & healthy. (Superia n.d)
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4. Competitior Profile
Nirma is one of the most recognizable Indian brands. Its story is a classic example of the success of Indian entrepreneurship in the face of stiff competition. Nirma took on the might of giant multinationals and wrote a new chapter in the Indian corporate history. Starting as a one-man operation in 1969, today, Nirma has about 14, 000 employee-base and annual turnover of more than Rs. 25, 00 crores. Founder of Nirma is Dr. Karsanbhai Patel, son of a small-time farmer and a qualified Science graduate. In 1969, the year he founded Nirma, Karsanbhai Patel was working as junior chemist in Government laboratory. In the night Karsanbhai used to make detergent in the 100 Sq. Ft. back yard of his home, using bare hands and bucket. In 1960s and 1970s, the domestic detergent market had only premium segment, with very few players and was dominated by MNCs. After making the detergent Karsanbhai used to pack it in polythene bag and sold it door-to-door. He priced the detergent at Rs. 3 per kg, when the available cheapest brand in the market was Rs. 13 per kg. In a short span of time, with indigenous process, packaging and low-profiled marketing, Nirma created an entirely new market segment in domestic marketplace and quickly emerged as dominant market player. Nirma rewrote the marking rules and its success story became one of the widely discussed case studies in the B-schools across the world. In the 1980s Nirma catapulted Surf, which was a well-established detergent product by Hindustan Lever, and occupied the top slot in the detergent products segment-a slot it has made its own. In 1990, Nirma entered the toilet soap market and today it is the second largest toilet soap brand in India. Today, Nirma has one of the largest volume sales with a single brand name in the world. Products of Nirma: Consumer Products Soaps: Nirma Bath Soap, Nirma Beauty Soap, Nirma Lime Fresh Soap, Nima Rose, Nima Sandal Detergent: Nirma Washing Powder, Nirma Detergent Cake, Super Nirma Washing Powder, Super Nirma Detergent Cake, Nirma Popular Detergent Powder, Nirma Popular Detergent Cake Salt: Nirma Shudh Scouring Products: Nirma Clean Dish Wash Bar, Nima Bartan Bar
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Industrial Products: LAB (Linear Alkyl Benzene) AOS (Alfa Olefin Sulfonate) Sulfuric Acid Glycerin Soda Ash Pure salt Vacuum Evaporated Iodized Salt SSP ( Single Super Phosphate ) Sodium Silicate
(Nirma Ltd. 2007)
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4.1. Competitor Analysis
BASIS LOGO
ITC Ltd.
NIRMA Ltd.
TAG LINE
PRODUCTS SEGMENTATION
GROUP SYNERGY
Beautiful You Today Tomorrow, Your Essence Your Soul, Khoobsurti Bas Mein Duniya Kadmon Mein, Aise Chamak K Duniya Bole Pehle Aap. Essensa Di Wills, Fiama Di Wills, Vivel Di Wills. It uses clear segmentation across its five product lines. It has leveraged its products like Hotels, Foods, Apparels, etc.
Better Products Better Value Better Living.
Soaps, Detergents, Clean Dish Wash Bar, Bartan Bar. Majorly it id diversified into two product lines. It has leveraged its products like soaps, detergents, sulphuric acids, glycerin, etc. Generally it communicates with localizes language.
COMMUNICATION STRATEGY BRAND EXTENSIONS
GROWTH RATE
This brand sport Western names, and different communication. It has a selective extension Extension was basically where essenza is an found in Premium Segment. exception. 16-18% 11.5-12%
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5. Management
5.1. Organizational Chart
Flowing from the concept and principles of Corporate Governance adopted by the Company, leadership within ITC is exercised at three levels.
Board of Directors
Audit Compensation Sustainability Committee Committee Committee
Nominations Committee
Investor Services Committee
Corporate Management Committee
Divisional/Strategic BusinessUnit Divisional/Strategic Business Unit (SBU) Management Committees, (SBU) Management Committees, each headed by a Divisional/SBU each headed by a Divisional/SBU Chief Executive Chief Executive
Corporate Functions, each headed by a HOD
Businesses include: Businesses include: FMCG, Hotels, Paperboards, FMCG, Hotels, Paperboards, Speciality Papers, Packaging, Speciality Papers, Packaging, Agri Business and Information Agri Business and Information Technology Technology
Corporate Functions include: Planning and treasury, Accounting, Taxation, Risk Management, Legal, Secretarial, EHS, Human Resources, Corporate Communications, Corporate Affairs, Internal Audit, Research and Development and Information Technology
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5.2. Corporate Strategies

ITC is a board-managed professional company, committed to creating enduring value for the shareholder and for the nation. It has a rich organisational culture rooted in its core values of respect for people and belief in empowerment. Its philosophy of all-round value creation is backed by strong corporate governance policies and systems. ITCs corporate strategies are: Create multiple drivers of growth by developing a portfolio of world class businesses that best matches organizational capability with opportunities in domestic and export markets. Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards & Packaging, Agri Business, and Information Technology. Benchmark the health of each business comprehensively across the criteria of Market Standing, Profitability, and Internal Vitality. Ensure that each of its businesses is world class and internationally competitive. Enhance the competitive power of the portfolio through synergies derived by blending the diverse skills and capabilities residing in ITC are various businesses. Create distributed leadership within the organisation by nurturing talented and focused top management teams for each of the businesses. Continuously strengthen and refine Corporate Governance processes and systems to catalyse the entrepreneurial energies of management by striking the golden balance between executive freedom and the need for effective control and accountability. (The ITC Way n.d)
5.3. Contribution to Triple Bottom Line

5.3.1. Economic A growing portfolio encompassing FMCG, Paperkraft and Packaging, Agri and Food Business, Hotels and Information Technology. A turnover of over US $ 5 billion and a market capitalisation of over US $ 16 billion. Total Shareholder Returns, measured in terms of increase in market capitalisation and dividends, grew at a compound fate of over 24% per annum over the last five years.
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The new FMCG businesses support the competitiveness, technology upgradation and market reach of over 170 Small and Medium Enterprises (SMEs).
5.3.2. Environmental ITC has been Carbon Positive four years in a row (sequestering/storing twice the amount of CO2 that the company emits). Water Positive seven years in a row (creating two times more Rainwater Harvesting potential than ITCs net consumption). Solid Waste Recycling Positive (Reusing/Recycling more solid waste than generated). All Environment, Health and Safety Management Systems in ITC conform to international standards.
5.3.3. Social ITCs businesses generate livelihoods for over 5 million people. ITCs globally recognised e-Choupal initiative is the worlds largest rural digital infrastructure benefiting over 4 million farmers. ITCs Social and Farm Forestry initiative has greened nearly 96,000 hectares, creating an estimated 43 million person-days of employment among the disadvantaged. ITCs Watershed Development initiative brings precious water to over 46,000 hectares of dry lands and moisture-stressed areas. ITCs Sustainable Community Development initiative empowerment, supplementary education and integrated programmers. (ITC Limited Sustainability Report 2009) include womens animal husbandry
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5.4. Human Resource

5.4.1. Staffing Process
Recruitment
Selecting from among the Applicants
Placement and Orientation
Training and Development
Performance Appraisal
Promotion and Career Planning
Compensation
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Recruitment Process Ensures that provided candidates, are most suitable for your specific requirements. Our trained consultants pre-screen and pre-select applicants before submitting their details for we want to assure accurate matching between our company and any prospective employee. Collection of Curriculum Vitae from applicants interested in one or more of our offers. Every Curriculum Vita is written in the ITC format, which allows for easy comparison of each candidate's details. Performing the first telephone interview in order to make preliminary assessments of the overall competency of a candidate, especially in regards to their level of English. All documents are then collected and reference checks are performed including employment history, criminal background and health checks. If the panel is fully satisfied with the results and feel confident that the candidate is suitable for your specific requirements, then the second interview is odne and later sends the application to the potential employer who then obviously makes the final decision. The final interview is then conducted at Krakow, head office. Also, arranging travel for any prospective employee to ensure the final step runs smoothly.
Selection Process The selection process is objective and robust.ITC soaps selects talent for the Technical function from the 5 IITs (Chennai, Delhi, Kanpur, Kharagpur, Powai) and some of the NITs. Engineers from disciplines such as Mechanical, Electrical and Electronics, Production Engineering, Chemical and Civil are considered for placement. The process starts in August each year with a campus visit and a pre-placement presentation. This provides an opportunity for young aspirants to learn more about the Company, its achievements, its strategies and the kind of careers they can look forward to. A range of selection tools are used. These include assessment centres, group tasks and in-depth personal interviews. Candidates found suitable for employment are immediately given offers to join ITC in July of the following year. After a comprehensive induction programme, they are assigned to various businesses of the Company. ITC also selects first-year students for Summer Internships
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A team of ITC managers visits campuses once again between December and March for final placement. The process consists of group discussions and personal interviews preceded by psychometric tests and assessment centres. Employment offers are made to selected candidates immediately. On joining ITC in July, candidates undergo an induction programme before being assigned to one of the Company's businesses. Employment offers are made to selected candidates immediately. On joining ITC in July, candidates participate in an induction programme. Thereafter they are assigned to responsibilities in Trading, Sourcing and Logistics in the Agri Business Division. ITC believes in taking out the best out of the pool of application received during recruitment process. It believes in infusion of new blood in their organisation.
Training and Development Training has become most crucial aspect in ITC SOAPS because of chanding standards of technology and its services. Training courses are sometimes offered for 6 months with internship so it invites freshers which are motive of ITC SOAPS. Training is given by practical demos with latest and modern machines and equipments and is conducted professionally.
Compensation Policy ITC believes that managerial remuneration is an important instrument in attracting and retaining talent and a key component of the performance management system. Three features of ITC's remuneration strategy are: Remuneration must leverage performance and therefore the need for a strong linkage between remuneration and performance when considering annual remuneration reviews as well as when periodically adjusting remuneration for market. Remuneration must be market-led. For this purpose remuneration is reviewed on an ongoing basis in relation to identified benchmark companies to ensure that remuneration practices are in sync with the competitive situation. Remuneration must take into account "affordability" and the Company's capacity to pay and hence cannot be divorced from business realities.
Remuneration distribution of 2008-2009 Minimum wages are paid to employer as per rate in state decided by state government according to the turnover. Last year salary of person was between Rs. 10,000 12,000 per month.
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Sales incentives are based on targets at the store. However employees are encouraged to concentrate on producing goods to standards lay down by company. As employees are encouraged to give more output in order to get more incentives with their salaries. Incentives like bonus, free education for children for 1 year, travelling expenses, flat, etc are given. Medical reimbursement of Rs. 9000 for a period of 3 years. Rs. 10,000 reimbursement on all the ITC Products in 1 year. Note: Importance on health standards of safety as required under law factory at 1948 and is strictly maintained by ITC soaps. (Careers with ITC n.d)
Pension Obligation Employees Retirement Benefit Schemes funded through duly constituted and improved independent trusts. Provident Fund and Family Pension contributes in respect of unionized staff, as required by the statutes, deposited with the government. There are different pension plans and obligations and these plans cover over 18,000 employees. These plans are fully funded in accordance with annual actuarial valuation. The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified. The funds are consistently sustained to meet requisite superannuation commitments.
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5.4.2.Code of Conduct Following code of conduct is applicable and followed by all directors, senior management and employees of the Company. Preamble ITCs Code of Conduct was circulated to the employees more than five years back and is posted on the Companys corporate website. This Code has now been re-drafted for better presentation. This Code is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct. Philosophy ITC is a professionally managed organisation and the core value underlying our corporate philosophy is "trusteeship". organisation has been handed by the various stakeholders in "trust" and we as professionals are the "trustees" of these stakeholders. It is therefore our responsibility to ensure that the organisation is managed in a manner that protects and furthers the interests of our stakeholders. We recognise society as an important stakeholder in this enterprise and therefore it is part of our responsibility to practise good corporate citizenship. It is also our belief that in order to serve the interests of our stakeholders in perpetuity, we must build ITC into an institution whose dynamism and vitality are anchored in its core values. Corporate Governance Policy The Corporate Governance Policy is the apex level instrument guiding conduct of the affairs of the Company and clearly delineates the roles, responsibilities and authorities of the key entities in the governance structure of the Company. This Code forms an integral part of the Companys Governance Policy. The directors, senior management and employees must adhere to the Corporate Governance Policy of the Company. Good Corporate Citizenship A Gender Friendly Workplace As a good corporate citizen, ITC is committed to a gender friendly workplace. It seeks to enhance equal opportunities for men and women. Sexual harassment includes unwelcome sexually determined behaviour such as: unwelcome physical contact; a demand or request for sexual favours; sexually coloured remarks; showing pornography and any other unwelcome physical, verbal or non-verbal conduct of a sexual nature. ITC maintains an open door for repartees; encourages employees to report any harassment concerns and is responsive to employee complaints about harassment or other unwelcome
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and offensive conduct.ITC demands, demonstrates and promotes professional behaviour and respectful treatment of all employees. Legal Compliance It is the Companys policy to comply fully with all applicable laws and regulations. The Company cannot accept practices which are unlawful or may be damaging to its reputation. Divisional Management Committees must satisfy themselves that sound and adequate arrangements exist to ensure that they comply with the legal and regulatory requirements impacting each business and identify and respond to developments in the regulatory environment in which they operate. Health and Safety The Company attaches great importance to a healthy and safe work environment. ITC is committed to provide good physical working conditions and encourages high standards of hygiene and housekeeping. Particular attention should be paid to training of employees to increase safety awareness and adoption of safe working methods, particularly designed to prevent serious or fatal accidents. Environment Policies The Company believes that commitment to sustainable development is a key component of responsible corporate citizenship and therefore deserves to be accorded the highest priority. Accordingly, the Company is committed to Best Practices in environmental matters arising out of its business activities and expects each business to fully demonstrate this commitment. Personal Conduct Avoidance of Conflict of Interest All directors, senior management and employees must avoid situations in which their personal interest could conflict with the interest of the Company. This is an area in which it is impossible to provide comprehensive guidance but the guiding principle is that conflict, if any, or potential conflict must be disclosed to higher management for guidance and action as appropriate. Transparency and Audit ability All directors, senior management and employees shall ensure that their actions in the conduct of business are totally transparent except where the needs of business security dictate otherwise. Such transparency shall be brought about through appropriate policies, systems and processes, including as appropriate, segregation of duties, tiered approval mechanism and involvement of more than one manager in key decisions and maintaining
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supporting records. It shall be necessary to voluntarily ensure that areas of operation are open to audit and the conduct of activities is totally auditable. Protection of Confidential Information No director, senior management and employee shall disclose or use any confidential information gained in the course of employment/ association with the Company for personal gain or for the advantage of any other person. No information either formally or informally shall be provided to the press, other publicity media or any other external agency except within approved policies. Company Facilities No director, senior management and employee shall misuse Company facilities. In the use of Company facilities, care shall be exercised to ensure that costs are reasonable and there is no wastage. Non Adherence Any instance of non-adherence to the Code of Conduct / any other observed unethical behaviour on the part of those covered under this Code should be brought to the attention of the immediate reporting authority, who shall in turn report the same to the Head of Corporate Human Resources. (Code of Conduct)
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5.4.3. Core Values ITC's Core Values are aimed at developing a customer-focused, high-performance organisation which creates value for all its stakeholders: Trusteeship As professional managers, we are conscious that ITC has been given to us in "trust" by all our stakeholders. We will actualise stakeholder value and interest on a long term sustainable basis. Customer Focus We are always customer focused and will deliver what the customer needs in terms of value, quality and satisfaction. Respect For People We are result oriented, setting high performance standards for ourselves as individuals and teams. We will simultaneously respect and value people and uphold humanness and human dignity. We acknowledge that every individual brings different perspectives and capabilities to the team and that a strong team is founded on a variety of perspectives. (Our Core Values n.d)
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5.4.4. Policy on Human Rights ITC believes that all its employees must live with social and economic dignity and freedom, regardless of nationality, gender, race, economic status or religion. In the management of its businesses and operations therefore, ITC ensures that it upholds the spirit of human rights as enshrined in existing international standards such as the Universal Declaration and the Fundamental Human Rights Conventions of the ILO. Policy ITC upholds international human rights standards, does not condone human rights abuses, and creates and nurtures a working environment where human rights are respected without prejudice. Implementation The Corporate Human Resources function of ITC is responsible for the Human Rights Policy design, implementation and updation. The policy is implemented at all locations of ITC through a set of separate policies and procedures covering each of the main constituents of human rights applicable at the workplaces. Monitoring & Audit The assessment procedures for different constituents of this policy are defined against each specific policy. (Policy on Human Rights n.d)
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5.4.5. Safety at Work All units in ITC have established EHS management systems with designated responsibilities, competent resources, best-in-class infrastructure, state-of-the-art fire detection & protection systems and the latest electrical equipment, etc. to achieve benchmarked performance in safety. Employee involvement through participation in suggestions schemes, holding EHS events and EHS Training have helped develop and maintain a safety culture across the organisation. Our units also engage in proactive risk assessment techniques to identify potential hazards and implement risk control measures to eliminate/reduce risks. Corporate EHS experts review new projects/expansion plans and conduct comprehensive audits before commissioning projects to ensure compliance. Although the Indian Factories Act/Rules, which is aligned with the requirements of ILO, is comprehensive and encompasses all requirements for a safe and healthy work environment, we collaborated with National Safety Council of India to develop our own Corporate EHS Guidelines, which are far more stringent than the Indian legislation and include international standards and best practices. A comprehensive incidents/accidents reporting system has been established at every unit. All accidents and incidents are thoroughly investigated to identify the root cause and initiate corrective and preventive measures. The findings and recommendations are discussed at the safety committee meetings and circulated to all Departments for implementation. In 2008-09, our focus on providing a safe work environment yielded positive results with lost time accidents reduced by 25%, injury rate by a third, lost day rate by 11.4%. Effective implementation of excellent safety standards resulted in zero fatality in 2008-09.
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(Occupational Health and Safety 2009)
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5.4.6. Quality Policy ITC is committed to delivering world-class products and services. This requires a clear focus on continuously striving to create a higher value to customers by achieving excellence in all Company's operations. Business excellence calls for a passionate focus on technology, products, services, processes and an operating environment firmly anchored to an impregnable foundation of Quality. ITC firmly believes that quality is not a specifically assignable task. It needs to be firmly rooted and institutionalized in the culture and value system of the Company. ITC nurtures a culture of striving for continuous improvement in quality, be it in products, services, systems or performance. The Company is committed to the establishment of systems and processes to promote organizational creativity and innovation. ITC's development of its Integrated Quality Management System (IQMS) is based on its strong foundation of implementing ISO 9001:2000, ISO 14001, OHSAS 18001, SA 8000, HACCP (for Foods) and IQRS (performance rating and benchmarking of the quality management system). Likewise, ITC's strategic initiatives for developing its people have been based on participative management concepts like QC (Quality Control), TQM (Total Quality Management), KSS (Kaizen Suggestion Scheme), 5S, Six Sigma. All ITC manufacturing units have ISO quality certification. Almost all contract manufacturing units in the Foods Business and all large hotels have food safety and quality systems certified by accredited 'third party' in accordance with 'Hazard Analysis Critical Control Points' (HACCP) standards. Additionally, the quality of all FMCG products of the Company is regularly monitored through 'Product Quality Rating System' (PQRS). The Leaf Tobacco and Printing & Packaging businesses have achieved world-class ratings in the 'International Quality Rating System' (IQRS) for business excellence in which key processes are rated against international benchmarks and certified by accredited 'third party' independent assurance providers. (Research and Development n.d)
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6. Marketing Environment
Marketing is a process whereby people exchange goods and services for money or for something of value to them. Phillip Kotler has defined marketing as a social process by which individual groups obtain what they need and want through creating offerings and freely exchanging products and services of value with others. Thus, marketing is a social process where in people interact with others, in order to convince them to act in a particular way, say to purchase a product or a service, rather than forcing them to do so.
Demographic Economic
Intermediaries
Logistics
Technological Natural
Product Place Target Price Consumers Promotion
Political Legal
Competitors
Bruce C. Bailey 1998
Social Cultural
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6.1. Macroenvironment Analysis

This includes all factors that can influence and organization, but that are out of their direct control. A company does not generally influence any laws (although it is accepted that they could lobby or be part of a trade organization). It is continuously changing, and the company needs to be flexible to adapt. There may be aggressive competition and rivalry in a market. Globalization means that there is always the threat of substitute products and new entrants. The wider environment is also ever changing, and the marketer needs to compensate for changes in culture, politics, economics and technology.
6.1.1. Demographics of India

The two aggregate demand growth drivers, namely investment and private consumption have moderated in India. The sectors growth drivers, i.e. manufacturing, agriculture, construction and communication have all experienced reduced growth rates. The Foreign Institutional adversely affected the Indian equity and foreign exchange markets in the wake of withdrawal Investors (FIIs), triggered by their need for liquidity support in other markets. The money, debt, and credit markets too were impacted. Thus, while the Indian Banking sector remained largely unscathed by the global financial crisis, it could not escape a liquidity crisis, in turn affecting investment and consumption in the real economy. The government had no option but to introduce stimulus packages estimated at 2.9% of the GDP. Combined with the loan waivers and the hikes granted by the Sixth Pay Commission, the pump priming of the economy has worsened the fiscal deficit. The Reserve Bank of India on its part attempted to inject liquidity through a series of policy interventions. Unfortunately, despite enhanced liquidity, credit flow to kick-start the economy remains inadequate since the banking system continues to be risk averse in this weak economic environment. The RBI seems to be determined to not allow the increasing levels of Government borrowing to diminish the availability of credit for the private sector. Simultaneously, it is persuading the banking sector to pay heed to policy signals and reduce their lending rates to stimulate investments.
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The latest World Economic Outlook brought out by the IMF expects global output to register downfall of 1.3% in 2009, its first fall in 60 years. Real GDP growth in advanced economies is likely to be a negative 4%. In emerging and developing economies, growth is likely to be sluggish at 1.6%, down from the 7-8% witnessed from 2004 onwards. World trade is expected to shrink by as much as 11%.
Economic Environment Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. India has been one of the best performers in the world economy in recent years, but rapidly rising inflation and the complexities of running the worlds biggest democracy are proving challenging. Indias economy has been one of the stars of global economics in recent years, growing 9.2% in 2007 and 9.6% in 2006. Growth had been supported by markets reforms, huge inflows of FDI, rising foreign exchange reserves, both an IT and real estate boom, and a flourishing capital market.
Political and Legal Environment The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. Political observers increasingly see the Indian polity as the problem. When populist political appeals stir the passions of the masses, government institutions appear less capable than ever before of accommodating conflicts in a society mobilized along competing ethnic and religious lines Budget impact: Among the FMCG stocks Marico and ITC are the biggest gainers. Marico has added 7.3% to Rs. 77. ITC has surged 7% to Rs. 212, after no change in excise cuts on cigarettes Due to Govt. new conditions ITC Maurya winning the 'Best eco-friendly hotel Special Prize' award by the Ministry of Tourism, Government of India.
Social and Cultural Environment

The social and cultural influences on business vary from country to country. It is very important that such factors are considered Envisioning a larger societal purpose has always been a hallmark of ITC. Following are the factor, which should be kept in mind while doing business in India:
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India, being a multi-cultural and multi-religious society, celebrates holidays and festivals of various religions India is one of the most religiously diverse nations in the world, with some of the most deeply religious societies and cultures. Religion still plays a central and definitive role in the life of most of its people. The demographics of India is remarkably diverse. India's population of approximately 1.17 billion people (estimate for July, 2009) consists of approximately one-sixth of the world's population India is a young country with an average age between 23-24 years.
As a corporate citizen with enduring relationships in rural India, ITC has a history of collaboration with communities and government institutions to enhance farm productivity and the rural resource base. ITCs commitments in agricultural R&D and knowledge sharing have spanned vital aspects of competitiveness efficient farm practices, soil and water management.
Technological Environment Technology is vital for competitive advantage, and is a major driver of globalization. Technology in India accounts for a substantial part of the country's GDP and export earnings while providing employment to a significant number of its tertiary sector workforce. Technically proficient immigrants from India sought jobs in the western world from the 1950s onwards as India's education system produced more engineers than its industry could absorb. Indias growing stature in the information age enabled it to form close ties with both the United States of America and the European Union IT plays a very critical role in driving the ITC business strategies. IT is an enabler of the business process to ensure business growth through efficient management of operations in the value chain. IT creates new business process or restructure the current business process to enhance customer service availability, efficient manufacturing / supply chain operations, etc.
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6.1.2. Demographics of the company The year under review marked the first full year of the Companys presence in the Personal Care space. The business continued to roll out its product portfolio comprising Soaps, Shampoos, Shower Gels, etc. under the Fiama Di Wills, Vivel Di Wills, Vivel and Superia brands across the country. The launch of the Vivel Ultra Pro Shampoo in the anti-dandruff segment has augmented the Vivel portfolio and widened the hair benefits offered to consumers. Consumer acceptance of the Companys products, as reflected in market research studies, has been gratifying. The Personal Care industry continues to grow at around 12% per annum, and stands at around Rs.23000 crores. In the face of a global recession, it is commendable that the domestic industry has been able to post this growth. The intervention by the Government, by way of lower taxes, easier credit and interventions in the rural sector have helped protect demand. Prices of commodities such as palm oil and surfactants which had spurted to all time highs in the early part of the year, declined during the latter half of the year, helping the industry to improve its profitability. The general consensus is that the price outlook for commodities will remain fairly subdued for the rest of 2009. As a result, there would be more opportunities to offer better value to consumers through promotional and other initiatives. The business added manufacturing capacity at its owned tax-exempt unit at Haridwar and is in the process of undertaking further expansion in line with expected market requirements. These investments will provide advantages of superior quality, flexibility, responsiveness, and intellectual property protection. Investments continue to be made to build a strong portfolio of products and brands and to expand the consumer base. This includes creation of world-class products through well-defined research and development activities at the Companys dedicated R&D Centre, and increased engagement with consumers through efficient deployment of media, direct contact, and promotional activities across traditional as well as contemporary consumer connect avenues.
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6.2. Microenvironment Analysis

This environment influences the organization directly. It includes suppliers that deal directly or indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small, but this can be misleading. In this context, micro describes the relationship between firms and the driving forces that control this relationship. It is a local relationship, and the firm may exercise a degree of influence. Suppliers Raw materials, intermediates and the final product sourcing/distribution in widespread across the country. Few items have more than 1 supplier for the raw material e.g. filter rods can be sourced from Mumbai, Bangalore or Devas in MP. Huge supply-demand network for cigarette business, which must operate in the cost optimal way to maximize the profits. Few segments are particular to factories e.g. King size. Consumers Organizations survive on the basis of meeting the needs, wants and providing benefits for their customers. Failure to do so will result in a failed business strategy. Its businesses and brands are focused almost entirely on the Indian markets, and despite being most well known for its tobacco brands such as Gold Flake, the business is now diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market sectors. Competitors Top competitors of ITC Limited

Hindustan Unilever Reliance Industries Tata Group Nirma Ltd.
Hindustan Unilever being the foremost competitor, followed by Nirma Ltd., Reliance Industries, and Tata Group. ITC beats it competitors as it follows a particular set of brand strategies which directly convince the customers to buy its products and services. Stakeholders As organization requires greater inward investment for growth they face increasing pressure to move from private ownership to public. However this movement unleashes the forces of shareholder pressure on the strategy of organizations. Satisfying shareholder needs may result in a change in tactics employed by an organization. The Company sees no conflict between the twin goals of shareholder value enhancement and societal value creation. The challenge lies in fashioning a corporate strategy that enables realization of these goals in a mutually reinforcing and synergistic manner. 244,65,39,845 Ordinary Shares of the Company, representing 64.79% of the Company's paid up capital, as on 11th September 2009 are in dematerialized form. The paid-up share capital of the Company is
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Rs. 377, 62, 86,590 (Rs.377.63 crores) divided into 377, 62, 86,590 Ordinary Shares of the face value of Re 1/- each.
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6.3. Internal Environment

All factors that are internal to the organization are known as the 'internal environment'. They are generally audited by applying the 'Five Ms, which are Men, Money, Machinery, Materials, and Markets. The internal environment is as important for managing change as the external. As marketers we call the process of managing internal change 'internal marketing.' Men ITC employs over 25,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 3, 53,000 shareholders, fulfill the aspirations of its stakeholders, and meet societal expectations. Money ITC is one of India's foremost private sector companies with a market capitalization of nearly US $ 14 billion and a turnover of over US $ 5 billion. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). Machinery ITC is using excellent machinery so that they can match with demand of the market. Their most of the facilities are fully automated. Materials ITC is using quality raw material so that they can give world-class quality product to their customers. They are very selective while selecting supplier for them. Markets Its businesses and brands are focused almost entirely on the Indian markets. Despite being well known for its tobacco brands such as Gold Flake, the business is now diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market sectors including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery.
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6.4. Segmenting, Targeting and Positioning 6.4.1. Segmenting

Segmentation refers to the division of market based on similar preferences and the taste of the people. Talking about the soap industry in India, the demand is based upon homogeneous preferences among the people stating the urge of consuming basic needs by the way of living. Keeping these factors in mind, the marketers have segmented the market on the demographic bases with three main factors i.e. gender, Income and the age of the consumers. To target different Income groups in the market, the Companys uses three different segment markets which are: Super premium: It covers the upper segment of the market that have high income level and more brand conscious while selecting the product from the market and who are not concern about the price of the product. The consumers targeted at this level are entrepreneurs, IT professionals, Doctors, Lawyers, top level executives and other people at high post in government jobs. Premium: The next level of segmentation done by the marketer is premium level, where Middle level people are targeted who is concern about both the factors i.e. Brand as well as Price of the different brands of soaps. In early stage of time, this segmentation was given more attention in terms of Promotion and Brand awareness due to high consumption of products of personal care at this level as compare to other but with changing period of time, the concern for super premium has also drawn equal attention. Bingo: The lowest level for segmentation defined by the marketers in industry of personal care products where people with low income level are targeted. As people here are more concern about the price of the product rather than the quality or the brand, the companies are rarely concern about their brand awareness and promotional activities. Second bases of segmentation is done on the Geographical factors mainly targeting three areas i.e. Urban areas like metropolitans cities Delhi, Bangalore, Mumbai,Ludhiana and Kolkata etc Sub-urban areas like Nagpur, Indore, and Allahabad Rural areas consist of all villages and other backward areas Precisely, Premium class - Essenza di wills Upper middle class - Fiama di wills Middle class - Vivel Lower class - Superia
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6.4.2. Targeting Depending on the available resources, experience and competency of the marketer and time available the marketer will decide which market to target. In this stage the marketing manager evaluates different market opportunities and decides how many and which one to target. This is called as target marketing. The marketing manager of ITC looks at five factors for evaluating each segment .They are Segment size Segment worthiness Segment measurability Segment attractiveness Segment accessibility
Niche Marketing A distinct set of needs A premium can be charged Not likely to attract competition Gains certain economies through specialization Sufficient size, profit and growth potential
Local Marketing In this the marketing mix is altered to suit the local conditions.EG. Giving a higher/ lower discount than whats prevailing in the rest of the markets or implementing a different promotion scheme Main Target ITC mainly target at super premium, premium and bingo sectors of the economy and looking at geographical area it covers Urban areas like metropolitans cities Delhi, Bangalore, Mumbai, Ludhiana and Kolkata etc Sub-urban areas like Nagpur, Indore, and Allahabad Rural areas consist of all villages and other backward areas
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ESSENZA DI WILLS
FIAMA DI WILLS
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VIVEL
SUPERIA
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64.3. Positioning It is the act of designing the companys offering and image to occupy a distinctive place in target markets mind. The marketing manager needs to decide which segment to enter and how to target that segment with a product offer through selection of market segment and target marketing strategy. The challenge is to decide what position the company wants its products to occupy in the selected segment. Today ITC has good position in market and has uplifted its value in front of consumers. There are some of the qualities of a successful position. In context with Nirma Relevance Distinctiveness Coherence Commitment Durability Clarity Courage.
Today ITC has gained 1st position in the market today according to Business Times.
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6.5. Marketing Mix Marketing comprises of 4Ps which are also called the elements of marketing and therefore, referred to as the Marketing mix.
Product
Place
Marketing Mix
Price
Promotion
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6.5.1. Product Essenze Di Wills Essenza Di Wills launches Mikkel A Mens Prestige Fragrance. The flagship brand in Consumer Care & Lighting stable and the 2nd largest brand of soap in India in the popular segment of the category. The brand enjoys two decades of trust since its launch in 1986 and has grown to be counted amongst the top brands in the Country in an intensively competitive market. Fiama Di Wills The popular and much-loved brand of ITC Products has been a favorite of people for many years. All different soaps, shampoo and shower gels in its range are having feel-fresh fragrance and high TFM index. Its range covers an economic Lime-fresh. For decades, Fiama Di wills -Original is one of the best soaps made in India. It had a simple red-cover which attracts none! But was still able to sustain itself in the market. The eye-catching and vibrant packaging symbolizes a sense of adventure, zest and action. The new range will be available across the country at modern retail and other outlets and will be supported by high-impact advertising on television, print, out-door, on-line and radio. Vivel The Vivel Di Wills range is available in two variants. Its unique carton pack has been developed by ITC's design team to provide a novel consumer experience. Superia In the popular segment, ITC has launched a range of soaps and shampoos under the brand name Superia. Superia Soaps enriched with natural ingredients give radiant glowing skin.
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ITC Soaps Superia, Vivel, Fiama di wills, Esence di wills Shampoo, Shower gel, Body foam, Aqua, Conditioners
SHAMPOOS: For Shiny Hair.Shower gels for healthy skin.Soaps for glowing skin.
Benefits of different products offered to consumers: SHAMPOOS: For Shiny Hair Shiny Black with Triple Conditioners and the natural goodness of Hibiscus & Brahmi extracts Vibrant Green with Triple Conditioners and the natural goodness of Amla & Arnica extracts
SOAPS: For Glowing Skin Fragrant Flower with the fragrance of Rose & Lavender Oil Soft Sandal with the fragrance of Sandal & Almond Oil Natural Glow with Neem & Coconut Oils Healthy Glow with Orange Oil
SHOWER GELS Mild Dew - Contains extracts of peach and avocado which moisturize the skin Clear Springs - Contains extracts of lemongrass & sea weed which gives Clear skin
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Products
Women
Essenza Di Essenza Di Wills Wills

Essenza Di Wills
Fiama Di Wills
Vivel
Superia
Eau De Perfume
Essenza Di Wills
Shampoo Conditioner Shower gel Bathing bars
Soaps Shampoo
Soaps Shampoo Triple conditioner
Eau De Toilette
Essenza Di Shower Gel Wills
Shampoo Bathing Bar Body Lotion Cleansing Milk Toner Nourishing Cream Deodorant
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Fiama di wills Shampoos

Everyday Mild (with extracts of Thyme & Juniper) is a gentle caring shampoo suitable for regular use. Aqua Balance (with extracts of Magnolia Blossoms & Watercress) is a gentle moisturizing shampoo ideal for dry, dull hair. Volume Boost (with extracts of Rosemary & Sage) is a gentle volumizing shampoo ideal for thin, limp hair. Silky Strong (with oils of Macadamia Nut and Babassu) helps make hair smooth, silky, and strong and is ideal for weak, damaged hair.
Superia Soaps Fragrant Flower: with the fragrance of Rose & Lavender Oil Soft Sandal: with the fragrance of Sandal & Almond Oil Natural Glow: with Neem & Coconut Oils Healthy Glow: with Orange Oil
Shampoos Shiny Black with Triple Conditioners and the natural goodness of Hibiscus & Brahmi extracts. Vibrant Green with Triple Conditioners and the natural goodness of Amla & Arnica extracts.
Another addition to the Superia shampoo portfolio, Superia Maxi Protect Active Health shampoo contains Dandruff Fighter along with Vitamins & Soya Protein. It fights multiple types of dandruff causing germs and leaves hair & scalp feeling clean & healthy.
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Products
Men
Essenza Di Wills
Vivel
Eau De Toilette After Shave Lotion Bathing Bar Deodorant Body foam Aqua fragrances
Soaps Shampoos
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Essenza Di Wills The range combines exotic naturals like Sage, Watercress, Magnolia blossoms Vivel Soaps Vivel Young Glow is enriched with Vitamin E and Fruit Infusions which help in providing youthful glow to the skin. Vivel Satin Soft is enriched with Vitamin E and Aloe Vera which help the skin feel beautifully soft. Vivel Sandal Sparkle is enriched with Sandalwood Oil and Active Clay which helps in providing clear skin. Vivel Ayurveda Essence is enriched with multiple Ayurvedic Ingredients which help protect skin from germs and harsh environment, keeping it healthy and beautiful. Vivel Silk Spring is enriched with Green Apple extracts and Olive oil which help in making skin smooth. Vivel Di Wills Sheer Radiance is enriched with Olive Oil, to provide skin lustre to make it radiant. Vivel Di Wills Sheer Crme is enriched with Shea Butter, to moisturize skin to make it soft and supple.. Shampoos

Vivel Shine & Glow is suitable for dull to normal hair and is enriched with Green Tea Extract and Conditioners. It adds shine to hair. Vivel Soft & Fresh is suitable for dry to normal hair and contains Extra Conditioners and Soya Protein. It makes hair soft and fragrant. Vivel Volume & Bounce is suitable for oily to normal hair and contains Jojoba Oil and Conditioners. It adds volume and bounce to hair.
The product portfolio was further enhanced with the launch of Ultrapro anti-dandruff shampoo under the umbrella brand Vivel in December 2008. Ultrapro promises to fight dandruff twice as effectively while also providing care for hair through the plus benefits of Nourishment and Moisturization.
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6.5.2. Place
ITC caters all sorts of segments but its basic aim is to cater the lowest level for segmentation which has been named as bingo segment people. Smartly concentrate its production in tax free zones in Jammu & Kashmir, Himachal Pradesh and Uttranchal. It produces nearly 70 per cent of its products in these areas. They give us a 10 per cent gross saving, which is an important factor in the high-volume, low-margin FMCG business, is as popular among the Saudis and Egyptians as it is among NRIs living there. Super premium: It covers the upper segment of the market that have high income level and more brand conscious while selecting the product from the market and who are not concern about the price of the product. The consumers targeted at this level are entrepreneurs, IT professionals, Doctors, Lawyers, top level executives and other people at high post in government jobs. Premium: The next level of segmentation done by the marketer is premium level, where Middle level people are targeted who is concern about both the factors i.e. Brand as well as Price of the different brands of soaps. In early stage of time, this segmentation was given more attention in terms of Promotion and Brand awareness due to high consumption of products of personal care at this level as compare to other but with changing period of time, the concern for super premium has also drawn equal attention. Bingo: The lowest level for segmentation defined by the marketers in industry of personal care products where people with low income level are targeted. As people here are more concern about the price of the product rather than the quality or the brand, the companies are rarely concern about their brand awareness and promotional activities.
Second basis of segmentation are done on the Geographical factors mainly targeting three areas i.e. Urban areas like metropolitans cities Delhi, Bangalore, Mumbai, Ludhiana and Kolkata etc Sub-urban areas like Nagpur, Indore, and Allahabad Rural areas consist of all villages and other backward areas ITC Products of personal care have 35 exclusive outlets and we will be expanding it to 70 outlets in the region outlets in Delhi, Chennai, Ahmadabad, Jaipur, Mumbai, Chandigarh and Saharanpur at present. Spread over 5 acres of land at Sehore in Madhya Pradesh.
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Essenza Di Wills
Fiama Di Wills
Vivel
Superia
Cater To
Super premium segment with the upper elite class
Premium segment with the mid and upper middle-class
Specifically to upper middle class consumers
Bingo segment i.e. lower income and rural segments
Available In
ITC Welcome Group Hotels Wills Lifestyle
Wills Lifestyle Stores Spencers hyper Big Bazaar Reliance Fresh ITC hotels
Big Bazaar Reliance Fresh LM 365 Big Apple Wal-Mart
Retail Outlets Department Stores John players Showrooms
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Essenza Di Wills is available at selected Wills Lifestyle showrooms in Ahemdabad, Jammu, Bangalore, Kerala, Kolkata, Lucknow, Ludhiana, Baroda, Pune, Chandigarh, Dehradun, Delhi, Goa, Gurgaon, Hyderabad, Jaipur, Kanpur, Lucknow.
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6.5.3. Price
The pricing of ITC soaps caters all sorts of income groups of people but special provision has been kept for low and middle group people and pricing is competitive for other market players. The company faces going rate pricing that is prices of products like Fiama Di Wills depends on competitors product like lux. The firm chooses pricing more or less the same as market leader. Current industry consumer spend estimated at over Rs. 21000 crores p.a. (growing at 12%)
Essenza Di Wills
Fiama Di Wills
Vivel
Superia
Shampoo Starts from Rs.2000 400-milligram Rs.154
Shampoo 100ml for Rs.59 9ml for Rs.3 200ml for Rs.109 Shower gel 200ml for Rs.99 100ml for Rs.54 Soap 70 grams for Rs.30 300grams for Rs.100 100 grams for Rs.40 Conditioner 100ml for Rs.68
Shampoo 200 ml for Rs.89 100ml for Rs.49 32ml for Rs.6 8ml for Rs.2
Shampoo 125ml for Rs.35 56 ml for Rs.15 7ml for Re.1 100ml for Rs.25 50ml for Rs.10 8ml for Re.1 4ml for Rs.0.5
Soap 45gms for Rs.6 92gms for Rs.17 225gms for Rs.49 75gm Rs.18
92gm for Rs.10 186gm for Rs.30 125 gm for Rs.12 464gm for Rs.50
Superia soaps will be available in sizes ranging from 50g to 125g, and the shampoos in 125 ml and 55 ml. Vivel Di Wills comes in an attractive carton package with some elegant color scheme.
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6.5.4. Promotion
Sales Promotion A sales promotion strategy is an activity that is designed to help boost the sales of a product or service. This can be done through an advertising campaign, public relation activities, a free sampling campaign, a gift campaign, a trading stamps campaign, through demonstrations and exhibitions, through prize giving competitions, through temporary price cuts, and through door-to-door sales, telemarketing, personal sales letters, and emails. The importance of a sales promotion strategy cannot be underestimated. This is because a sales promotion strategy is important to a business boosting its sales. While developing a sales promotion strategy for the product it is important to keep the following points in mind- Consumer attitudes and buying patterns, Brand strategy, Competitive strategy, Advertising strategy, and other external factors that can influence your products, availability and pricing. Sales Promotion strategies: A push strategy A pull strategy or A combination of the two A 'push' sales promotion strategy involves 'pushing' distributors and retailers to sell your products and services to the consumer by offering various kinds of promotions and personal selling efforts. The basic objective of this strategy is to persuade retailers, wholesalers and distributors to carry your brand, give it shelf space, promote it by advertising, and ultimately 'push' it forward to the consumer. Typical push sales promotion strategies include; buy-back guarantees, free trials, contests, discounts, and specialty advertising items. For Example: ESSENZA DI WILLS offer a 'pull' sales promotion strategy focuses more on the consumer instead of the reseller or distributor. This strategy involves getting the consumer to 'pull' or purchase the product/services directly from the company itself. This strategy targets its marketing efforts directly on the consumers with the hope that it will stimulate interest and demand for the product. This pull strategy is often used when distributors are reluctant to carry or distribute a product. FIAMA DI WILLS offer low introductory prices to the customers like in case of their new product. LAUNCHING ITS NEW SHAMPOO - They give some complementary gifts. A 'combination' sales promotion strategy is just that; it is a combination of a push and a pull strategy. It focuses on both the distributor as well as the consumers, targeting both parties directly. It offers consumer incentives side by side with dealer discounts
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In rural areas Communication Strategy - Based on information regarding buyer behavior. Motivating dealers as well as opinion leaders to generate word-of mouth publicity. This was followed by extensive van operation in 5000+ population areas with audience participation techniques for mouthing the brand, supported by mass media campaign in regional press (district wise edition), rural cinemas, radio, wall painting and intensive merchandising activities.
Advertisement Advertising is the means of informing as well as influencing the general public to buy products or services through visual or oral messages. A product or service is advertised to create awareness in the minds of potential buyers. Some of the commonly used media for advertising are T.V., radio, websites, newspapers, magazines, bill-boards, hoardings etc. As a result of economic liberalization and the changing social trends advertising industry has shown rapid growth in the last decade. Advertising is one of the aspects of mass communication. Advertising is actually brand-building through effective communication and is essentially a service industry. It helps to create demand, promote marketing system and boost economic growth. Thus advertising forms the basis of marketing.
In urban areas Newspaper : Eenadu(A.P), Dina Thanthi ( Tamil Nadu), Punjab Kesari (North), Loksatta (Maharashtra), Anand Bazaar Patrica (West Bengal), Daink Baskar (North) Television: Sun TV (Tamilnadu), Asianet (Kerla), Eenadu( AP), Aplha Punjabi (North), Aplha Mararthi (Maharashtra). Radio: Radio reach is highest in Kerla (62%) followed by Tamil Nadu (35%) and Karnataka (32%). Example : nirma,superis are some of the brands using radio communication programme. A ten second spot in Regional station would cost only about Rs. 2000/-
Outdoor Advertisement Form of media which includes signboard, wall painting, hoardings, tree boards, bus boards etc. ITCs mobile Vans take the message of e-choupal to new village.
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Major methods for advertising: E-mail messages: These can be wonderful means to getting the word out about the business. In this we design a e-mail software to include a "signature line" at the end of each of our e-mail messages. Many e-mail software packages will automatically attach this signature line to our e-mail, if we prefer. Magazines: Magazines ads can get quite expensive. Find out if there's a magazine that focuses on your particular product. If there is one, then the magazine can be very useful because it already focuses on your market and potential customers. Newspapers: Almost everyone reads the local, major newspaper(s). You can get your business in the newspaper by placing ads, writing a letter to the editor or working with a reporter to get a story written about your business. Radio announcements: A major advantage of radio ads is they are usually cheaper than television ads, and many people still listen to the radio, or example, when in their cars. Ads are usually sold on a package basis that considers the number of ads, the length of ads and when they are put on the air. . A major consideration with radio ads is to get them announced at the times that your potential customers are listening to the radio. Television ads: Many people don't even consider television ads because of the impression that the ads are very expensive. They are more expensive than most of major forms of advertising. However, with the increasing number of television networks and stations, businesses might find good deals for placing commercials or other forms of advertisements. Television ads usually are priced with similar considerations to radio ads, that is, the number of ads, the length of ads and when they are put on the air. Web Pages: You probably would not have seen this means of advertising on a list of advertising methods if you had read a list even two years ago. Now, advertising and promotions on the World Wide Web are almost commonplace. Businesses are developing Web pages sometimes just to appear up-to-date. Special events: These tend to attract attention, and can include, e.g., an open house, granting a special award, announcing a major program or service or campaign, etc. Promotional activities through Media: Articles that you write: Is there something in your product about you having a strong impression? Consider writing an article for the local newspaper or a magazine. In your article, use the opportunity to describe what you're doing to address the issue through use of your product. For example we do get good examples of product-based articles in tribune, where sometimes products also compared.
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Press kits: This kit is handy when working with the media or training employees about working with the media. The kit usually includes information about your business, pictures, information about your products, commentary from happy customers, etc. Rural Promotion and Advertising In country like India, where the 70% of the people live in rural area, the rural market holds a lot of marketing potential. There is a wide spread difference in the standard of living between urban and rural India. In order to launch products and develop advertising for rural market there is a need to understand both the rural context and also the consumer very well. Promotion of brands in rural markets requires the special measures. Due to the social and backward condition the personal selling efforts have a challenging role to play in this regard. The word of mouth is an important message carrier in rural areas. Infact the opinion leaders are the most influencing part of promotion strategy of rural promotion efforts. To communicate effectively with rural audiences, it is important to understand the aspirations, fears and hopes of rural customers, in relation to each product category, before developing a communication package to deliver the product message. Hence, there is a strong need to build reassurance and trust about product quality, service support and company credentials in the minds of rural consumers. This is best done through the face to face 'below the line' touch, feel and talk mode at haats, melas and mandis. Language and regional behavior variations should be considered while developing rural communications strategy. Although the reach of television in rural India is high, frequent power-cuts restrict viewing time considerably. With the licensing of FM channels to cover all district headquarters, the power of radio to deliver a localized message in a local language will soon be available to advertisers as a cost-effective way to reach rural masses. Rural India has a very high ownership of transistor radios and as these run on batteries, radio can once again be expected to become a popular medium for reaching rural masses. For Example: SUPERIA - With the objective of creating awareness for superia shampoo pouches in towns with less than 20,000 population in Tamil Nadu, and in order to convert loose shampoo buyers into superia pouch customers, ITC launched a van campaign. The communication Strategy focused on getting women out of their homes to participate in the van campaign, which was aimed exclusively for them and for the first time conducted by women. Result it showed a 25per cent conversion from loose shampoo usage to superia Pack. Promotional Activities in 2009 Itc Soaps, the fast moving consumer good giant has reduced promotional offers in 2009 as it focused on profitability at a time when volume growth was back. It has launched a slew of offers in year 2008 on Fiama Di Wills products, which is its second largest selling soap brand has withdrawn the offer. It has a market share of 15.5 per cent in the Rs 7,500 crore soap markets. It has a market share of over 25 per cent in the Rs.2,500 crore shampoo market.
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ITC has been affected by the volatility in 2008 the most, with the company losing market share across all its key soap, detergent and oral care categories. So in a bid to get the volumes back, it went in for consumer offers and aggressive advertising. This move worked, as the company saw a 2 per cent volume growth in the June quarter of 2009 financial year compared to a 4 per cent decline in the previous quarter of the previous year. 70 per cent of the category sales in case of shampoos sachets are dominated by players like ITC and CavinKare which are running '25 per cent extra' schemes.
Buy More Save More Companies also adopt "buy more to save more" concept to boost sales during the slowdown. While price correction is clearly a focus area, fast moving consumer goods (FMCG) companies like ITC Concepts to beat the current recession. ITC promotional offers, for instance, include one free cake of soap on purchase of three, and discounts on purchase of linked packs. According to officials at ITC discounts and promotional offers are temporary means to achieve strategic ends, which could include trial and competitive reaction. Reasons for promotional offers include rewarding loyal customers, passing on cost savings to consumers and inducing trial. ITC brands are new hence marketing efforts are geared towards enhancing consumer engagement and trial. The consumer response to brands, Fiama Di Wills, Vivel and Superia, has so far been excellent says officials at ITC.
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Essenza Di Wills
Promotional Tool used
Public Relation Tool used
Medium Used Magazine Articles News Print Media
Magazines
Websites
Electronic Print Media
Press Release
Schemes Used
Free samples to elite consumers who regularly visit the stores.
Brand Ambassador Deepika Padukone
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Fiama Di Wills
User Selling Proposition - This range is a combination of science and natural extracts for shampoos.
Medium Used Television Radio Websites Telemarketing Personal Sales Letter Electronic Print Media News Print Media Media Tours Press Release Newsletters Media Relations
Schemes Used
Free conditioner on 200ml shampoo Buy three, get one free' offer on the Rs.100 multipack
Brand Ambassador Deepika Padukone
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Vivel
User Selling Proposition - Vivel range has nourishment, protection and hydrating ingredients for complete skincare. skincare
Medium Used Door-to-Door sales Price-giving Competitions News Print Media Special Events Speaking Engagements Contests
Electronic Print Media
Schemes Used
Offers shampoo (200 ml) free with its 75 gm bathing soap Buy four and get one free offer on its Vivel soap.
Brand Ambassador Kareena Kapoor and Hrithik Roshan
Buy 2 and get a Reynolds pen free to Rs.1 discount on a soap bar of Rs.18.
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Superia
Medium Used News Print Media
Contest Opportunity to meet superstars Melas Employee relations Community relations and philanthropy
Prize -iving competitions Gift campaign Door-to-door sales Contest
Schemes used: Launched its products in sachets 2 +1 scheme on the superia soap. Meet superstar Ileana D'cruz
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6.5.5. Integrated Market Communication
Source:http://www.exchange4media.com/Brandspeak/brandspeak.asp?brand_id=112 The 21st century Indian woman is one who is radically different from the generation that preceded her. She stands for innate confidence, style and taste, and is extremely aware of all beauty products available to her today. She stops at nothing to look and feel good. Today, the ever discerning consumer has very specific product requirements. We aim to offer products that satisfy all these needs Sandeep Kaul, CEO-Personal Care Products, ITC Ltd Sandeep Kaul, CEO-Personal Care Products Business, ITC Ltd, has had an 18-year association with ITC, joining the group in 1990. In these 18 years, he has served across divisions such as Personal Care, Market Research, Consumer Research, and Tobacco. Buoyed by the success of Essenza Di Wills, its exclusive range of fragrances and super premium personal care products, ITC has launched Fiama Di Wills, a premium range of shampoos, soaps and shower gels. Fiama Di Wills continues ITCs tradition of bringing world-class products to the Indian consumer. In conversation with exchange4medias Indrani Sinha, Kaul, an alumni of Birla Institute of Technology, speaks about Fiama Di Wills and the ITC Groups plans for this brand. Q. What is the role of Fiama Di Wills in ITCs personal care portfolio? What is its target group and competing brands? A. Fiama Di Wills is a premium range of personal care products offered by ITC. The 21st century Indian woman is one who is radically different from the generation that preceded her. She stands for innate confidence, style and taste, and is extremely aware of all beauty products available to her today. She stops at nothing to look and feel good. We are proud to present this new range of premium personal care products to todays empowered women, who are smart, evolved customers and are very sure of their choices and what they want. Q. What product categories does the brand represent?
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A. Fiama Di Wills has a presence in shampoos, soaps, shower gels and conditioners. The brand operates in the premium market segment and we will expand the portfolio, depending on the various opportunities that may arise in the future. Q. What was the thought process behind the Fiama Di Wills brand? Who is your agency? A. Based on our market understanding, we have positioned Fiama Di Wills as a combination of nature and science, which give gentle and effective care. The creative agency is Law & Kenneth. Q. Are you planning to have any brand ambassador/ celebrity endorsement for this brand? A. Deepika Padukone is a perfect embodiment of the brand personality and we are extremely gratified with the positive consumer response to the brands association with her. She has gone a long way in building awareness about the brand and we may look at other celebrity endorsements in the future. Q. How do you plan to extend the brand's promise of 'Beautiful you, today, tomorrow' to on ground events? A. Consumer engagement has been targeted through multiple touch points. This includes mediums like television, press and outdoor as well as direct consumer engagement through one-on-one contacts at various points of congregation as well as in-store. In addition, all possible media have been leveraged to emphasise salient features of the brand. Q. Have you tried any new distribution channels or sampling methods to popularise the brand? A. Customer engagement, along with promotions is extremely important for any brand. To achieve these, we have carried out widespread consumer activation at various malls, multiplexes, colleges and in stores. Q. Is the brand available pan-India or is it being launched in a phased manner? A. The brand is available across the country. Q. How are you priced vis--vis your competition? A. Fiama Di Wills products are competitively priced vis--vis premium personal care competitive products. Our shampoos are prices at Rs 99 for a 200 ml bottle and Rs 54 for a 100 ml bottle. Our shower gels are priced at Rs 90 for a 200 ml bottle. Q. Could you tell us something about any packaging innovations that you have done? A. We are aware that packaging plays a vital role in premium personal care products. The product packaging for Fiama Di Wills has been developed by international design houses to ensure high quality standards. Q. What kind of volumes/ market share are you looking at to begin with?
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A. Fiama Di Wills has so far gained widespread acceptance in the market. In terms of product quality, packaging and pricing, the response has been very encouraging. Our aim is to make significant inroads in the premium personal care market segment. Q. You have several trademarks competing in the same categories like shampoo, soaps, etc. What is your overall strategy for your personal care business? A. As I had said earlier, consumer engagement has been targeted through multiple touch points. Today, the ever discerning consumer has very specific product requirements. We aim to offer products that satisfy all these needs, and in the process establish Fiama Di Wills as the leading brand in the premium personal care market segment.
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ITCs Official Website www.itcportal.com
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ITCs Media Release

ITCs John Players embarks on a new journey with Ranbir Kapoor Mar 18, 2010
Unveils New Brand Logo, Spring Summer Collection 2010 and New Advertising Campaign In its endeavor to celebrate the joy of fashion, John Players, the youth fashion brand of mens apparel from ITC, today embarked on a new journey with Ranbir Kapoor by announcing the launch of its new advertising campaign. Reinforcing its connect with the style conscious youth, the advertising campaign, featuring Ranbir Kapoor, brings vividly alive both the personality of the brand and the vibrant new range. Adding to the spirit of celebration, Ranbir Kapoor in his inimitable style dazzled the ramp while presenting the exquisitely designed John Players Spring Summer Collection 2010. The platform was also used to launch the new brand logo, which wears a more contemporary look to connect with its audience. Scheduled to be launched in April this year, the advertising campaign, which is simple and clean, captures the various moods of Ranbir and his effortlessly cool persona. Speaking on the occasion, ITCs Divisional Chief Executive, Mr. Atul Chand said, With Ranbir, we plan to strengthen John Playerss connect with the youth and the foundation has been laid today with the launch of new brand logo. John Players new logo reflects the evolution of the brand in keeping with the changing consumer attitudes. Im particularly happy that the New Face of Cool for John Players, Ranbir is unveiling the new John Players Spring Summer Collection 2010 in person which also marks his commitment for the brand. As a youth icon, Ranbir is a trend-setter and appeals to a young audience. His style, charisma and attitude are reflected in the sentiments of millions of young Indians who aspire to be fashionable and trendy. He brings with himself a refreshing new look which we believe will go a long way in reinforcing universal appeal for the brand, he added. Expressing his excitement, Ranbir Kapoor said, It is a pleasure to be associated with John Players, a strong brand in its segment that understands existing and emerging needs of the fashion conscious youth of today. Moreover, it is wonderful to associate yourself to a brand with whom you are able to relate to. I am able to connect to John Players ideology of fashion as I feel its an inherent part of me. The collection this season is cool yet stylish and is perfect for todays go-getter generation. I had fun shooting the John Players spring summer 2010 ad campaign. In fact, Im very curious to see the reactions to the campaign when it is released. Going forward, I hope to contribute in my own little way to the brand persona and styling, Ranbir added.
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ITCs Bhadrachalam Facility gets coveted Forest Stewardship Council Certification
Mar 16, 2010
ITC has achieved yet another milestone in its environmental journey. India's largest integrated pulp and paper and paperboard manufacturing facility of ITC at Bhadrachalam has been awarded the FSC Chain of Custody certificate. It is the most widely respected certification for responsible fibre sourcing around the world. This certification provides a unique competitive edge to ITCs finepapers and paperboards in an increasingly environment-conscious world. The Forest Stewardship Council (FSC) is an independent, non-governmental, not-for-profit organization established to promote the responsible management of the worlds forests. FSC is a certification system that provides internationally recognized standard-setting, trademark assurance and accreditation services to companies, organizations, and communities interested in responsible forestry. Chain of Custody (CoC) certificates for paper/paperboard manufacturers are awarded after stringent audits that seek to establish the traceability of the fibre being used. The auditors verify that all material comes from known, legal sources which do not threaten the ecological balance and high conservation values of forests. ITC is already a global leader in the area of sustainability. Along with being India's first company to be invited to be a member of the WWF's Global Forest and Trade Network (WWF GFTN), ITC also has a sustainable social and farm forestry programme that has now greened over 100,000 hectares of land. ITCs unique large scale social forestry project has been the first of its kind in India to be registered with the UNFCC under the Clean Development Mechanism (CDM). The benefits of the project activity, which will earn 57792 CERs, will be passed on to the tribals post expenses incurred for the CDM project. ITC has also pioneered the innovative Wealth Out of Waste (WOW) programme in India, for collecting recyclable fibre directly from households. These achievements speak volumes for ITC's aspiration to be an exemplar in sustainability practices. This FSC certification comes close on the heels of the September 2009 certification of ITC PSPD's recycled paperboards unit at Kovai, underlining ITC's commitment to obtain credible environmental certifications for its wide range of products in paper and paperboard. ITCs Paperboards and Paper Business will now be able to offer unique products to discerning customers that are certified to be manufactured with sustainably sourced virgin or post consumer recycled content, under the ''FSC Mixed' and 'FSC Recycled' labels. Going forward, ITC PSPD will continue to pursue excellence in environmental performance, and increasingly offer credibly certified products from all its unit
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Media Reports
ITC sees a future in green houses

Economic Times
March 13, 2010
ITC Ltd, with business interests ranging from tobacco to FMCG to hotels, has taken an in-principle decision to achieve Platinum LEED rating the highest global certification for environment-friendly buildings for every major construction it takes up from now on. The move, which perhaps marks the first such initiative taken by a corporate group in the country, would involve every hotel, office building, factory or shop that ITCplans to build. We have big plans to grow which involve investment in new buildings. Our objective is to reduce our carbon footprint across the companys operations and on its premises. The initiative will also encompass every existing property and office premises that ITC owns. For instance, for those properties which come up for renovation, we will introduce environment-friendly systems and processes that will set the ball rolling for them to achieve the green rating, Kurush Grant, member, corporate management committee, ITC Ltd. He was speaking to ET on the sidelines of a seminar on UK-India Business Partnership: Low Carbon Economy, organised by CII to mark the visit to Kolkata of the UKs representative for trade and industry, Prince Andrew, Duke of York. Incidentally, Platinum LEED, which stands for Leadership in Energy and Environment Design, is a US Buildings Council certification, has recently inspired an Indian standard in Teri-Griha or The Energy and Research Institutes Green Rating for Integrated Habitat Assessment. The latter was devised for India keeping local conditions in mind and involve energy efficiency, water conservation, environment. At present, we are implementing the initiative through in-house knowledge gathered over the years. If we get the right kind of experts we could also work with them, Mr Grant added. The company has already made a beginning of sorts in green buildings with the ITC Sonar Kolkata being the first hotel in the world to achieve thegreen tag. ITC has eight CDM projects registered so far, Mr Grant added. Apart from ITC Sonar, two other buildings that have already received green credits are ITC Royal Gardenia in Bangalore and ITC Green Centre in Gurgaon. Earlier, speaking at the seminar, Mr Grant shared some of ITCs experience with green initiatives. ITCs move to lower carbon footprint is being built around each business model and through corporate social responsibility around each unit, he said. For example, in its paper and packaging business, ITC faced a choice on whether to import wood pulp from Indonesia or to take up social forestry. It chose the latter and has now emerged as one of the champions in carbon sequestration, with 30% of its energy coming from renewable sources.
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In the green
Business Standard
December 15, 2009
Going green is good for the bottom line Going green, as a series of feature articles in this newspaper have shown, is not just good for the environment, it is good for corporate bottom lines also. If energy costs form a tenth of all costs, for instance, then anything which reduces energy intensity can only be good. The question, of course, is whether the energy-saving devices cost so much that they negate the effect of the annual saving. While most purveyors of energy-saving equipment say payback periods are under four years, the companies featured seem to suggest this is indeed true some, like ITC, claim to have delivered extra returns of up to a fourth to shareholders as a result of various environment-friendly measures. And these benefits are without taking into account the possibilities of tapping into the multi-trillion dollar opportunity for environmental products and services that are likely by 2020. Just the likely environmental credits that Indian industry can earn on the basis of the 1,400 Clean Development Mechanism (CDM) that has been approved so far, can earn a little over $6 bn by 2012. While ITC has always been known for its pioneering work in the field, this got a fillip with US Secretary of State Hillary Clinton visiting ITCs Green Centre in Gurgaon and calling it a monument to the future. A little over a decade ago, ITCs paper business was bleeding and what turned it around was a greening project over 100,000 hectares involving tribals and small and marginal farmers the company gave them saplings for commercial forestry which helped the environment (part of this programme is registered as a CDM project) and aided the bottom line from 15 to 30 per cent. The group as a whole is the only company of its size to be carbon positive for four years in a row, water positive for seven years in a row and solid-waste recycling positive since last year. Maruti Suzuki India Limited, the countrys largest auto-maker, similarly, has cut electricity consumption by a fifth between 2000-01 and 2008-09, water consumption by half and, since 200203, carbon emissions by 30 per cent. Apart from what it does to the companys bottom line, it complements its marketing effort. In a market like Europe that is increasingly getting fanatic about the environment, the companys A-Star is the first out of the country that meets the European end-of-life vehicle norms since 87 per cent of the car can be recycled at the time of scrapping; the rest, according to the company, can be put in incinerators and used in other forms. Though few power utilities have gone green, the potential is large since, as L&Ts sustainability report puts it, a watt saved is worth three watts generated, taking into account both the large transmission and distribution losses, apart from the losses due to the thermal inefficiency of equipment using this electricity. Few of the smaller units across the country are looking at going green, but the ones that have used energy-efficient furnaces or biomass gasifiers from Teri will testify, this has reduced costs and increased efficiency. So, whatever the view on whether Environment Minister Jairam Ramesh was right to talk of India needing to take on some non-binding commitments of her own at the Copenhagen global warming summit, the path for corporate India is quite clear.
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Fiama Di Wills
Vivel
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Essenza Di Wills
Superia
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7. Current Performance
7.1. Analysis of Current Financial Statements
Sales Turnover In the year 2008 it was Rs. 21467.38 crores and in the year 2009 it rose to Rs. 23247.84 crores. That means there was an increase in sales turnover by Rs. 1780.46 crores. And, when calculated in percentages it was 7.65%. Net Sales In the year 2008 the net sales of the company were Rs.14032.20 crores & in the year 2009 it was Rs.14985.81 crores. So, it is visible that there was an increase by Rs. 953.61 crores. And, in percentages it was by 6.36%. Total Expenses The total expenses in the year 2008 were 9615.51 crores but they were increased in 2009 to Rs. 10671.16 crores. Reason for this may be that company has expanded itself so much so the expenses were increased by this huge amount i.e. by Rs.1055.65 crores. And, in percentages it is 9.89%. Operating Profit It is Net Sales-Operating expenses. In the year 2008 it was Rs. 4449.15 crores and in the year 2009 it came to Rs.4944.95 crores. There was an increase in it i.e.Rs 495.8 crores. And, in percentages it was by 10.02%. Assets In the year 2008 they were Rs.2041.90 crores. And in the year 2009 it increased to Rs.2588. 91 crores. There was an increase of total Rs. 547.01 crores. And in percentages it has increased by 21%. Share Value Current prices of shares range between Rs. 245 and Rs. 255. Share Value has shown a growth of 130%.
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Business performance: ITC has managed to pass on the rising tax burden to its customers while maintaining a healthy growth rate. The margin of the companys cigarette business, for example, rose from 22 per cent in fiscal year 2004 (FY04) to 27.67 per cent in FY09. The compounded annual growth rate (CAGR) of the cigarette business remained healthy over this period at over 10 per cent, which is comparable to the growth of the overall FMCG industry. It follows that the company can handle margin pressure in its cigarette business due to rising government taxes However, the cigarette business is not the sole contributor to ITCs topline. In FY09, non-cigarette products accounted for around 49 per cent of its net turnover. Its non-cigarette portfolio includes fastmoving consumer goods (FMCG), hotels, paperboards, specialty papers and packaging and agri-business. ITC has strong brands in each category, such as Bingo, Sunfeast, Ashirwad and Fiama Di Wills in FMCG, and ITC Hotel and WelcomHotel in the hotels category. In the paperboards business, ITC is the market leader. Over the years, all of these segments have recorded healthy growth rates. For example, the FMCG segment (excluding cigarettes), has recorded a CAGR of 74 per cent in the last seven years. Financial performance: ITC is strong on all financial parameters. The sales CAGR for the last five years stands at around 15 per cent, and profit after tax grew higher at 17 per cent. It has a low debt-toequity ratio of 0.01. The cash flow has also increased: at the end of FY09, its cash balance was Rs 1,032 crore. ITCs hotel business was the only segment that was hit hard by the economic slowdown. However, the previous quarter (Q3FY10) results show that it is gaining traction. Overall, in Q3FY10, the companys net sales and profit grew 18 per cent and 26 per cent yo-y, respectively. (Worries Go Up In Smoke, outlookindia.com 2010)
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7.2.
Key Economic Indicators
ITC has progressively has grown over the years and is one of Indias foremost creators of wealth in private sectors. Given its unique business models, corporate strategies, governance philosophy of trusteeship, the economic value created by it has benefited all stakeholders. This is manifested in the creation of world-class products and services with superior quality for their customers, increasing contribution to the national exchequer, contribution to the livelihood of over 26,000 people through direct employment and supporting the livelihoods of over 5 million people through their business and social initiatives.
Table of Key Economic Indicators
Key Economic Indicators Gross Turnover Net Turnover Exports Contribution to Government Cost of Bought out Goods and Services Employee Wages & salaries Payments to Providers of Capital Interest and Dividend Retained Profits Community Investments
2007 Rs. (Crores) 19300 12164 1926 8455 7578 630 1170
2008 Rs. (Crores) 21356 13948 1695 10768 8810 733 1324
2009 Rs. (Crores) 23144 15388 1762 11233 9639 891 1415
1335 64
1577 57
1634 61
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Analysis of Key Economic Indicators
Net Turnover
20000 Rs. Crores 15000 10000 5000 0 2007 2008 Year 2009 12164 13948 15388
Employee Wages and Salaries

1000 800 Rs. Crores 600 400 200 0 2007 2008 Year 2009 630 733 891
Reatined Profits
2000 Rs. Crores 1500 1000 500 0 2007 2008 Year 2009 1335 1577 1634
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Payment to Providers of Capital-Dividend and Interest

1500 Rs. Crores 1000 500 0 2007 2008 Year 2009 1170 1324 1415
Community Investments
66 64 62 60 58 56 54 52 Rs. Crores 64 61 57
2007
2008 Year
2009
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8. Awards and Recognition

Year Award
2007
SAM/SPG Sustainability Leadership Award conferred at the International Sustainability Leadership Symposium, Zurich. Business Person of the Year from UK Trade & Investment, the UK Government organisation that supports overseas businesses in that country.
2006
2006
Inducted into the `Hall of Pride' by the 93rd Indian Science Congress.
2005 2001
Honored with the Teacher's Lifetime Achievement Award. Manager Entrepreneur of the Year from Ernst & Young Retail Visionary of the Year from Images, India's only fashion and retail trade magazine.
1998 1996 1994
Honorary Fellowship from the All India Management Association Distinguished Alumni Award from IIT, Delhi. Marketing Man of the Year from A&M, the leading marketing magazine.
1986
Meridien Hotelier of the Year.
Notable recognitions are: The Stockholm Challenge 2006 for the e-Choupal initiative. This award is for using Information Technology for the economic development of rural communities. United Nations Industrial Development Organisation (UNIDO) Award at the international conference on Sharing Innovative Agribusiness Solutions 2008 at Cairo for ITC's exemplary initiatives in agri business through the e-Choupal. The Corporate Social Responsibility Crown Award for Water Practicesfrom UNESCO and Water Digest for its distinguished work carried out in the water sector in India. ITC also received the National Award for Excellence in Water Management 2007 in
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the 'beyond the fence' category from the CII Sohrabji Godrej Green Business Centre for its leadership role in implementing water and watershed management practices. The watershed programme also won the Asian CSR Award 2007 for Environmental Excellence given by the Asian Institute of Management.The Award recognizes and honours Asian companies for outstanding, innovative and world-class projects. The Company also received the Ryutaro Hashimoto Incentive Prize 2007 for Environment & Development from the Asia Pacific Forum. This Award aims at promoting information dissemination of good practices towards sustainable development in the Asia-Pacific region. The Readers' Digest Pegasus Award for corporate social responsibility, recognising outstanding work done by socially conscious companies. The Corporate Award for Social Responsibility 2008 from The Energy and Resources Institute (TERI) in recognition of its exemplary initiatives in implementing integrated watershed development programmes across 7 states in India. The company also won the award in 2004 for its e-Choupal initiative. The Award provides impetus to sustainable development and encourages ongoing social responsibility processes within the corporate sector. The 'Enterprise Business Transformation Award' for Asia Pacific (Apac),instituted by Infosys Technologies and Wharton School of the University of Pennsylvania for its celebrated e-Choupal initiative. The Best Corporate Social Responsibility Practice Award 2008 jointly instituted by the Bombay Stock Exchange, Times Foundation and the NASSCOM Foundation. The NASSCOM CNBC IT User Award 2008 in the Retail & Logistics category. The Company has been recognised for its pro-active and holistic approach to IT adoption and the seamless alignment of IT with business strategy. This is the fourth time that ITC has won Nasscom's Best IT User Award since it was instituted in 2003. The Institute of Chartered Accountants of India Award for Excellence in Financial Reporting with its Annual Report and Accounts, adjudged as a commendable entry under the Category 'Manufacturing and Trading Enterprises. The Business Today Award for the Best Managed Company in recognition of its outstanding initiatives in the consumer products segment. The only Indian FMCG company to have featured in the Forbes 2000 list. The Forbes 2000 is a comprehensive ranking of the world's biggest companies, measured by a composite of sales, profits, assets and market value. The list spans 51 countries and 27 industries.
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The NDTV Profit Business Leadership Award for being the Best Food Company of 2007. The Award has been instituted to recognise organisational excellence. The CNBC-TV18's International Trade Award 2008 for Outstanding Exporter of the Year in the FMCG & Food category. ITC continues its dominance of The Economic Times' Brand Equity listing of India's 100 Biggest FMCG Brands, with three brands from its stable making it to the top five. Gold Flake remains India's biggest FMCG brandin terms of sales. Navy Cut ranks at No. 4. ITC's Scissors brand ranks at No 5 and is the only new entrant into the top 10. Restaurant magazine has chosen Bukhara at the ITC Maurya, New Delhias the best Indian restaurant in the world and the best restaurant in Asia. Bukhara has also been adjudged one of the top 50 restaurants in the worldby the London based magazine 'The Good Food Guide'. Bukhara is the only South Asian restaurant to figure in the list. The "Best Supply Chain Practices Award" for time-effective and cost-efficient Logistics Management in Organized Retail to ITC's Lifestyle Retailing Business Division (LRBD). The awards were organized by Retailers Association of India (RAI) in association with ITW Signode - the International leaders in packaging solutions. (Global Honours n.d)
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9. Economic Environment
9.1. Overview of the Personal Care Industry
The price of the premium segment products is twice that of economy segment products. The economy and popular segments are 4/5ths of the entire soaps market. The penetration level of toilet soaps is 88.6%. However, the per capita consumption of soap in India is at 460 gms per annum, while in Brazil it is at 1,100 gms per annum. In India, soaps are available in five million retail stores, out of which, 3.75 million retail stores are in the rural areas. Therefore, availability of these products is not an issue. 70% of India's population resides in the rural areas; hence around 50% of the soaps are sold in the rural markets. With increase in disposable incomes, growth in rural demand is expected to increase because consumers are moving up towards premium products. However, in the recent past there has not been much change in the volume of premium soaps in proportion to economy soaps, because increase in prices has led some consumers to look for cheaper substitutes. The major players in personal wash (Soap) market are HLL, Nirma and P&G.
9.2. Industry Capacity and Recent Trends

The personal care segment is dominated by HUL, whose brands, including Lux, Dove, Sunsilk and Clinic Plus, have 52.7% market share in soaps and 46.5% in shampoos, according to HUL. Two analysts based in Mumbai reveal that the company had around a 2% share of the total personal-care products market. ITC has made sizeable investments in launching personal care products, spending heavily on advertising and promotions and distribution. The companys sales grew 16% to Rs7,662.99 crore and net profit declined by 0.15% to Rs1,551 crore in the first six months of 2008-09. We have very clear internal targets and milestones for our progress and we are meeting those milestones.
9.3. Future Prospects

The future for the personal care products industry is very prosperous, which can be analyzed by the rising growth trends of the industry. But there are many concerns related to the chemicals and toxins used as ingredients for making personal care products. These substances can affect our health and the environment also. They are absorbed through our skin and can enter our bloodstream thereby affecting our kidney and liver, and thus can have very harmful effects on our bodies and when these products are washed off from the body, they are released in to the environment.
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Many companies are addressing these problems and are shifting their focus to the natural and organic products. These products are beneficial to our health as well as environment, because very less quantity of synthetic compounds and toxic elements are used in these products. In most of the countries the demand for organic products has been rising steadily. According to a study conducted by the Natural Personal Care Consumers: Unlocking Future Potential, the organic products market in UK alone will rise from USD 18.19 million in 2007 to USD 24.26 million in the year 2011. Organic and natural personal care products industry has profited much from the growing consumer awareness and their changing lifestyles. These developments have also helped in introduction of a lot of organic products in the market. Despite many sectors showing signs of maturation in the key, developed markets, innovation remains high and while economic prosperity continues many consumers are proving willing to make the trade up, signalling a positive future for value sales. (Personal Care Industry Overview n.d)
9.4. ITCs Expansion Plan

ITC Ltd, which made a big-splash entry in 2007 into the highly competitive market for consumer products such as soaps and shampoos, plans to expand its range of personal care brands as it strives for a bigger market share. ITCs current personal-care portfolio includes soaps, shampoos and fragrances. These products are marketed under the Fiama Di Wills, Superia and Vivel brands. Superia caters to the mass consumer segment, Vivel targets the premium and Fiama the so-called superpremium market. Products are priced at between a low of Rs.5 for a mass-market soap to Rs.2,100 for a high-end perfume. (ITC mulls expansion of its range of personal care brands 2009)
9.5. Analysis of ITCs FMCG Personal Care Sector

Current industry consumer spend estimated at over Rs. 21000 crores p.a. (growing at 12%) Essenza Di Wills (Super Premium) Portfolios premium imagery augmented with launch of Aqua for men in fine fragrances and grooming range Fiama Di Wills (Premium) Launched with Shampoos/Soaps/Shower Gels/Conditioners Vivel Di Wills and Vivel (Mid) Soaps and Shampoos Superia (Popular) Soaps and Shampoos Products well received in the market, gaining customer acceptance Supported by investments in brands celebrity endorsements Investments being made in Research & Development and strategic tax incentivized manufacturing sites
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10.Demand
Price of goods
The demand for ITC products majorly depends upon the pricing of the goods. The soaps category is divided into 3 types i.e. high and snazzy customers, then it caters to premium sectors which include upper-middle class and the 3rd category which is priced for middle class. According to law when price rise demand decreases. Therefore when price of ITC personal care products rise the demand for it would decrease. So in this case the price of its neck throat competitor i.e. NIRMA would increase and vice-versa. Income of Consumers
If the purchasing powerof the consumer is high then the demand for high range products that is products of Essensa Di Wills would increase definitely. Similarly it goes for all the 3 categories of the products. Superia is the mass brand from the ITC stable, catering to lower income and rural segments
Price of the Related goods
The demand for the products of one brand depends upon the price of the other branded products. For e.g. if the price of ITC soaps goes up then demand for Nirma soaps would increase. Many people would give preference to buy nirma soap in that case. Taste patterns of the consumers
It is very important for the consumers to have a favorable image of the brand so that the products of the same brand could be easily sold out. So anyhow, if ITC suffers a bad image its products would not be demanded by customers anymore. For e.g. the advertising policy of ITC nowadays is becoming more famous and reaching customers mind , as compared to NIRMA so it definitely matters a lot. And would help in increasing ITCS sales more and more. Expected future price of products
If it is expected that ITC will raise its price in near future, then the demand for its products would increase in the present itself.
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Number of consumers in the market Depending upon the range of the products the customers for each class gets divided. So if the consumers are more in the premium range products then its demand would increase definitely. Similarly it goes for rest 2 categories. Other Important Factors: Segmentation
Creating brands from scratch with no history and lineage, ITC used clear segmentation across its five product lines and the target audience, each brand was meant for. Group Synergy
Once the five products were created and communication strategies set, ITC leveraged its properties like hotels, foods and apparel store network to retail these brands. Communication Strategy
Like HUL, these brands sport Western names, and different communication. Essenza & Fiama, meant for the elite, have English communication, while Vivel & Superia use Hindi. Brand Extension
Selective extensions as it dont want to confuse consumers with too many irrelevant brand extension & sub-brands. The Essenza range is the only exception. Brand Ambassador
ITC uses brand ambassadors strategically. While for the Fiama and Vivel ranges it has roped in brand ambassadors, for the Superia & Essenza ranges the key TG is the real king. Deepika padukone and Kareena kapoor are its brand ambassadors. Packaging
Since packaging plays a key role in product differentiation, ITC uses it to the hilt. It has taken foreign experts help to make its products stand out from competition.
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11. Supply
Price of the good
The price of good is directly related to the supply of any ITC product. The company would like to sell the products especially which are of high range i.e. products of Essensa Di Wills. As the prices are really high for these products so company would like to earn more and more revenues out of it. Input Prices
Prices of the raw materials affect the supply of the products. If the input prices are high it would not be very profitable to sell the products so the company would decrease the sales so that they do not lose their profits. For e.g. one of the raw material is caustic soda and if its prices are increased so it would affect in manufacturing the final product very much. Prices of the goods related in production
The price of the products of other brands such as Nirma, HUL affects the supply of ITC (soaps) products. If the price for the other branded products increases, then the sale of ITC products would increase. Technological advances
Advancement in the technology would decrease the production costs and would provide higher profits to the company. The brand would prefer to produce more due to advancement in the technology and thereby the supply of the products will increase. Expected future price of the products
If the future prices of the products are expected to increase, the current supply of the ITC products will decrease because ITC would want to sell its products when the prices will rise so that they can earn higher profits.
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ITCs total sales in the third quarter rose 18 percent to 45.3 billion rupees. Analysts expected 43.9 billion rupees. ITCs other income, which includes financial investments, rose 63 percent to 1.59 billion rupees. Revenue from ITCs hotel business rose for the first time in five quarters since the terrorist attacks in Mumbai in November 2008. Sales rose 0.2 percent to 2.48 billion rupees. Profit before taxes and interest fell to 762.9 million rupees. Sales at its paper business gained 29 percent to 8.12 billion rupees in the quarter. Profit before taxes and interest added 81 percent to 2.01 billion rupees.
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12. Budgetary Impact on FMCG Sector

Higher excise duty on non-filter cigarettes. Reduction in excise duty from 16 per cent to nil on tea and coffee mixes. Reduction in excise duty from 16 per cent to 8 per cent on water purification devices, specified packaging material and breakfast cereals. Tea Fund to get Rs 40 crore special support fund, while the Tea Research Association would get Rs 20 crore. Customs duty on bactofuges reduced from 7.5 per cent to nil
Excise duty on paper, paper board and articles manufactured out of non-conventional raw materials reduced from 12 per cent to 8 per cent with a further reduction on clearances up to 3,500 MT from 8 per cent to nil. Excise duty on certain varieties of writing, printing and packaging paper is to be reduced from 12 per centto 8 per cent. 12.1. Impact on sector Higher excise duty on non-filter cigarettes will bring it on par with both filter cigarettes. This is negative for the tobacco segment. Reduction in excise duties on packaging products would provide thrust to the packaging segment. Customs duty reduction on bactofuges would benefit dairy industry and increase shelf life of milk.
12.2. Impact on companies

Higher excise duty would reduce cigarette sales volumes in non-filter segment. Further, reduction on excise on paper and paperboard would boost demand. Reduction in water purification devices would help Hindustan Unilever by way higher demand for its product 'Purefit'. Reduction in excise on tea, coffee and breakfast cereals would help companies like Tata Tea, HUL, Nestle. Reduction in duties would drive growth in the processed foods and personal care segment. Essel Propack and FMCG companies like HUL, ITC, Nestle and would benefit. The positive take aways were the reduction in excise duty on finished goods as well as packaging material. The lowering of direct tax will help create more consumer demand. We are disappointed that the customs duty was not brought down. (Union Budget 200809: Impact on FMCG sector 2008)
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13. Implications of Monetary Policy
13.1. Measures
Bank Rate
The Bank Rate has been retained unchanged at 6.0 per cent. Repo Rate
The repo rate under the Liquidity Adjustment Facility (LAF) has been retained unchanged at 4.75 per cent. Reverse Repo Rate
The reverse repo rate under the LAF has been retained unchanged at 3.25 per cent. The Reserve Bank has the flexibility to conduct repo/reverse repo auctions at a fixed rate or at variable rates as circumstances warrant. The Reserve Bank retains the option to conduct overnight or longer term repo/reverse repo under the LAF depending on market conditions and other relevant factors. The Reserve Bank will continue to use this flexibly including the right to accept or reject tender(s) under the LAF, wholly or partially, so as to make efficient use of the LAF in daily liquidity management. Cash Reserve Ratio
The cash reserve ratio (CRR) of scheduled banks has been retained unchanged at 5.0 per cent of net demand and time liabilities (NDTL).
13.2. Implications
The thrust of the various policy initiatives by the Reserve Bank since mid-September 2008 has been on providing ample rupee liquidity, ensuring comfortable dollar liquidity and maintaining a market environment conducive for the continued flow of credit to productive sectors. The important measures initiated include reduction of the repo and reverse repo rates, reduction of the CRR and the SLR, institution of several sector-specific liquidity facilities, establishment of a forex swap facility and relaxation in the guidelines for raising external commercial borrowings (ECBs). Also, the Reserve Bank allowed restructuring of stressed assets by banks in order to increase the flow of credit for productive purposes.
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In the Annual Policy Statement of April 2009, the reverse repo and repo rates were reduced by 25 basis points each. Currently, the reverse repo rate is at 3.25 per cent and the repo rate is at 4.75 per cent. These are at their historically lowest levels. (First Quarter Review of Statement on Monetary Policy for the Year 2009-10 2009)
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14.SWOT Analysis
14.1. Strengths
ITC leveraged it traditional businesses to develop new brands for new segments. For example, ITC used its experience of transporting and distributing tobacco products to remote and distant parts of India to the advantage of its FMCG products. ITC master chefs from its hotel chain are often asked to develop new food concepts for its FMCG business. ITC is a diversified company trading in a number of business sectors including cigarettes, hotels, paper, agriculture, packaged foods and confectionary, branded apparel, personal care, greetings cards, Information Technology, safety matches, incense sticks and stationery.
14.2. Weaknesses
The companys original business was traded in tobacco. ITC stands for Imperial Tobacco Company of India Limited. It is interesting that a business that is now so involved in branding continues to use its original name, despite the negative connection of tobacco with poor health and premature death. To fund its cash guzzling FMCG start-up, the company is still dependent upon its tobacco revenues. Cigarettes account for 47 per cent of the companys turnover, and that in itself is responsible for 80% of its profits. So there is an argument that ITCs move into FMCG (Fast Moving Consumer Goods) is being subsidized by its tobacco operations. Its Gold Flake tobacco brand is the largest FMCG brand in India and this single brand alone holds 70% of the tobacco market.
14.3. Opportunities
Core brands such as Aashirvaad, Mint-o, Bingo! And Sun Feast (and others) can be developed using strategies of market development, product development and marketing penetration. ITC is moving into new and emerging sectors including Information Technology, supporting business solutions. e-Choupal is a community of practice that links rural Indian farmers using the Internet. This is an original and well thought of initiative that could be used in other sectors in many other parts of the world. It is also an ambitious project that has a goal of reaching 10 million farmers in 100,000 villages. ITC leverages e-Choupal in a novel way. The company researched the tastes of consumers in the North, West and East of India of atta (a popular type of wheat flour), then used the network to source and create the raw materials from farmers and then blend them for consumers under purposeful brand names such as Aashirvaad Select in the Northern market, Aashirvaad MP Chakki in the Western market and Aashirvaad in the Eastern market. This concept is tremendously difficult for competitors to emulate.
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Chairman Yogi Deveshwars strategic vision is to turn his Indian conglomerate into the countrys premier FMCG business. Per capita consumption of personal care products in India is the lowest in the world offering an opportunity for ITCs soaps, shampoos and fragrances under their Wills brand.
14.4. Threats
The obvious threat is from competition, both domestic and international. The laws of economics dictate that if competitors see that there is a solid profit to be made in an emerging consumer society that ultimately new products and services will be made available. Western companies will see India as an exciting opportunity for themselves to find new market segments for their own offerings.
14.5. Financial Strengths

Profits from operations grow up 26% Pre- tax profits up 28% Post-tax profits up 27% Non-Cigarette FMCG segment robust revenue grow at 24% Agri business profits more than double for two quarters running with a growth of 107% Paper and pulp segment grow by 81%
14.6. Financial Weaknesses Major dependence on the cigarette sector Personal care sector not as strong as the tobacco sector Hotel industry impacted by slowdown in the economy
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15.Horizontal Analysis (Profit and Loss Account)

ITC Limited
Items 0 9 0 8 Absolute Change % Change Comments
Sales
23,247.84 21467.38
1780.46
8.29
Manufacturing 87.04 Expenses
73.52
13.52
18.38
Selling Expenses
1619.58
1609.33
10.25
0.65
Cost of Sales
Operating Profit
4944.95
4449.15
495.8
11.14
Depreciation
549.41
438.46
110.95
25.3
Tax Charges
1565.13
1480.97
84.15
5.68
Reported Net Profit
3263.59
3120.1
143.49
4.5
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Nirma Limited
Items 0 9 0 8 Absolute Change % Change Comments
Sales
3031.82
233.06
698.76
29.95
Manufacturing 1451.96 Expenses Selling Expenses Cost of Sales 458.22
1110.29
341.67
30.77
393.4
64.81
16.47
2516.95
1947.64
569.31
29.23
Operating Profit Depreciation
514.87
385.42
129.45
33.58
244.38
226.65
17.73
7.82
Tax Charges
31.29
3.15
28.14
893.3 2 -57.04
Reported Net Profit
93.43
217.55
(124.12)
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16.Conclusion
ITC Ltd. Has diversified itself into 5 bottom lines. They are mainly: FMCG, Hotels, and Paperboards which includes specialty paper and packaging, Agri Business and last is Information Technology. ITC constitutes 2% share for Personal Care Products in the market. It is basically categorized into 4 major brands i.e. Essenza Di Wills, Fiama Di Wills, Vivel Di Wills and Superia. ITC has contributed economically in the triple bottom line as follows: It has made sizeable investments in launching personal care products, spending heavily on advertising and promotions and distribution. The companys sales grew 16% to Rs7,662.99 crore and net profit declined by 0.15% to Rs1,551 crore in the first six months of 2008-09. We have very clear internal targets and milestones for our progress and we are meeting those milestones. The personal care segment is dominated by HUL, whose brands, including Lux, Dove, Sunsilk and Clinic Plus, have 52.7% market share in soaps and 46.5% in shampoos, according to HUL. Two analysts based in Mumbai reveal that the company had around a 2% share of the total personal-care products market. ITC has one of the best corporate strategies like continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Packaging, Agri Business and Information Technology. Enhance the competitive power of the portfolio through synergies derived by blending the diverse skills and capabilities residing in ITC are various businesses Some of the best honors and awards which ITC has got are The Best Corporate Social Responsibility Practice Award 2008 jointly instituted by the Bombay Stock Exchange, Times Foundation and the NASSCOM Foundation. The "Best Supply Chain Practices Award" for time-effective and cost-efficient Logistics Management in Organized Retail to ITC's Lifestyle Retailing Business Division(LRBD). The vision of the company is To be a leading labor administrator in their region in order to enhance the well being of workforce progressively and to promote the safety and health of those at work. The mission of the company is to improve and safeguard employees rights and benefits in an equitable manner.
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STRENGTH Brand Management
WEAKNESS Unrelated Diversification
OPPORTUNITY Rural Market E-Choupal
THREATS Increasing Tax on Cigarettes Health Hazard
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17. Recommendations
ITC Limited should work on its weaknesses in order to improve them and also look for ways to overcome the threats faced. WEAKNESS Unrelated Diversification
THREATS Increasing Tax on Cigarettes Health Hazard
After carrying out all the data, analysis and conclusion about ITC Ltd. There is an area for improvement left for the company which would help this big profile company to expand more and more. Following are the points which the company needs to remember: Unrelated Diversification: that means, the company need not diversify itself unnecessarily to all the fields, rather should work in the areas, or industries which is getting it maximum revenue. Dependency on Tobacco: the company is more dependent on the revenue which comes out of the tobacco. So they need to divert their area for making business out of these cigarettes. Competition from both domestic and international: The laws of economics dictate that if competitors see that there is a solid profit to be made in an emerging consumer society that ultimately new products and services will be made available. Western companies will see India as an exciting opportunity for themselves to find new market segments for their own offerings. Health Hazard: the company needs to be very attentive and handle the issues regarding health. Because all the tobacco producing companies do face this problem.
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18.Labour Department
Vision To be a leading labor administrator in their region in order to enhance the well being of the workforce progressively and to promote the safety and health of those at work. Mission To improve the utilization of human resources by providing a range of employment services to meet changes and needs in the labour market. To ensure that risks to peoples safety and health at work are properly managed by legislation, education and promotion. To foster harmonious labour relations through promotion of good employment practices and resolution of labour disputes. To improve and safeguard employees rights and benefits in an equitable manner.
18.1. Delhi
The mission of the department is to promote growth and commercial activities by ensuring harmonious relationship between employer and workmen. Responsibilities assigned to the department: Enforcement of various labour laws. Conciliation of disputes between worker and management. Referring the disputes to the labour courts and industrial tribunal for adjudication. Welfare related activities through welfare boards and departmental machinery and implementing the provisions laid down under Labour Legislations.
Rates of minimum wages payable in Garment industries: Categories of workers Unskilled Semi-skilled Skilled Basic min. wages 151.31 157.69 167.62 V.D.A 0.73 0.73 0.73 Total min. wages 152 158 168
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Rates of minimum wages payable in retail showrooms: Categories of workers Unskilled Semi-skilled Skilled Basic min. wages 151.31 157.69 167.62 V.D.A 0.73 0.73 0.73 Total min. wages 152 158 168
18.2. Haryana
Objectives To facilitate the growth of industry in Haryana by fostering harmonious industrial relations. To implement labour laws for ensuring proper working conditions and labour standards. To promote industrial health and safety. To introduce new labour welfare measures for enhancing the quality of life of the work force. To eliminate employment of all forms of child labour through identification and rehabilitation.
Rates of minimum wages payable in Garment Industries: Categories of workers Unskilled Semi-skilled A Semi-skilled B Skilled A Skilled B In rupees per day 151 156 161 166 171
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Rates of minimum wages payable in Retail showrooms: Categories of workers Unskilled Semi-skilled A Semi-skilled B Skilled A Skilled B Highly skilled In rupees per day 151 156 161 166 171 176
Note: Unskilled employees having 10 years experience would be categorized as Semi Skilled A. After 3 years of experience in Semi Skilled A the employees would be categorized as Semi Skilled B. And after 3 years of experience in Skilled A the employees would be categorized as Skilled B.
18.3. Uttar Pradesh

Subjects allotted to the ministry Labour policy and Legislation Safety, health and welfare of labour. Social security of labour Workers education Labour and employment statistics Policy to targets groups: Women and Child labour. Emigration of labour .
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Rates of minimum wages payable in Garment industries: Categories of workers Unskilled Semi-skilled Skilled Basic min. wages 100 114 126.54 V.D.A 29.69 33.85 37.57 Total min. wages 129.69 147.85
Rates of minimum wages payable in Retail showrooms: Categories of workers Unskilled Semi-skilled Skilled Basic min. wages 100 114 126.54 V.D.A 29.69 33.85 37.57 Total min. wages 129.69 147.85
18.4. Bihar
Objectives: Implementations of labour laws. Protecting interests of workers, both in organized and un-organized sector. Creation of skilled labour force by imparting training through I.T.Is. Medical care of workers insured on the ESI corporation.
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Rates of minimum wages payable in Garment Industries: Categories of workers Unskilled Min. wages 89 V.D.A 15 Total wages 104
Semi-skilled Skilled Highly skilled
92 113 138
15 19 23
107 132 161
Rates of minimum wages payable in Retail Industries: Categories of workers Min. wages V.D.A Total wages
Unskilled Semi-skilled Skilled Highly skilled
89 92 113 138
15 15 19 23
104 107 132 161
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ANNEXURE
Figures for social, economic and environmental are as in July 2009 Balance Sheet
MAR09 (Rs. In Crores) SOURCES OF FUNDS Owners funds Equity Share Capital Share Application Money Preference Share Capital Reserves & Surplus LOAN FUNDS Secured Loans Unsecured Loans Total USES OF FUNDS Fixed Assets Gross Block Less: revaluation reserve Less: accumulated depreciation Net Block Capital work-inprogress Investments NET CURRENT ASSETS Current Assets, loans and advances Less: current liabilities Total net current assets Miscellaneous expenses not written Total NOTES: Book Value of unquoted investments Market Value of quoted investments Contingent Liabilities Number of equity shares outstanding(lacs) MAR08 (Rs. In Crores) MAR07 (Rs. In Crores)
377.44 ______ ______ 13,302.55 11.63 165.92 13,857.54
376.86 _____ ______ 11,624.69 5.57 208.86 12,215.98
376.22 ____ _____ 10,003.78 60.78 140.10 10,580.88
10,558.65 55.09 3,286.74 7,216.82 1,214.06 2,837.75
8,959.70 56.12 2,790.87 6,112.71 1,126.82 2,934.55
7,134.31 57.08 2,389.54 4,687.69 1,130.20 3,067.77
8,450.99 5,862.08 2,588.91
7,306.99 5,265.09 2,041.90
6,281.07 4,585.85 1,695.22
13,857.54 2,861.88 9.12 261.36 37744.00
12,215.98 2,958.68 13.42 308.08 37686.10
10,580.88 3,091.90 13.30 129.56 37622.23
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Profit and Loss Account

MAR09 (Rs. In Crores) MAR08 (Rs. In Crores) 21,467.38 7,435.18 14,032.20 516.50 32.46 14,581.16 6,307.79 309.90 745.00 73.52 1,609.33 682.72 -112.75 9,615.51 4,449.15 4,965.65 24.61 4,941.04 438.46 0.00 4,502.58 117.41 4,619.99 1,480.97 3,120.10 3,307.72 0.00 1,319.01 224.17 MAR07 (Rs. In Crores) 19,519.99 7,206.16 12,313.83 276.22 322.96 12,913.01 5,807.48 253.00 630.15 65.32 1,299.17 601.28 -42.52 8,613.88 4,022.91 4,299.13 16.04 4,283.09 362.92 0.00 3,920.17 61.94 3,982.11 1,263.07 2,699.97 2,806.40 0.00 1,166.29 198.21
INCOME Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income Expenditure Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Admin Expenses Miscellaneous Expenses Preoperative Exp Capitalised Total Expenses Operating Profit PBDIT Interest PBDT Depreciation Other Written Off Profit Before Tax Extra-ordinary items PBT (Post Extra-ord Items) Tax Reported Net Profit Total Value Addition Preference Dividend Equity Dividend Corporate Dividend Tax Per share data (annualised) Shares in issue (lakhs) Earning Per Share (Rs) Equity Dividend (%) Book Value (Rs)
23,247.84 8,262.03 14,985.81 425.22 630.30 16,041.33 6,863.97 394.12 903.37 87.04 1,619.58 875.63 -72.55 10,671.16 4,944.95 5,370.17 47.65 5,322.52 549.41 0.00 4,773.11 81.52 4,854.63 1,565.13 3,263.59 3,807.19 0.00 1,396.53 237.34
37,744.00 8.65 370.00 36.24
37,686.10 8.28 350.00 31.85
37,622.23 7.18 310.00 27.59
107
2010
108

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ITC Limited Personal Care

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3. Product Profile ITC: Touching Your Lives Everyday

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3.1 Personal Care Products

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(Nirma Ltd. 2007)

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4.1. Competitor Analysis

Better Products Better Value Better Living.

COMMUNICATION STRATEGY BRAND EXTENSIONS

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Audit Compensation Sustainability Committee Committee Committee

Investor Services Committee

Corporate Management Committee

Corporate Functions, each headed by a HOD

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5.2. Corporate Strategies

5.3. Contribution to Triple Bottom Line

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5.4. Human Resource

Selecting from among the Applicants

Placement and Orientation

Training and Development

Promotion and Career Planning

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(Occupational Health and Safety 2009)

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Product Place Target Price Consumers Promotion

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6.1. Macroenvironment Analysis

6.1.1. Demographics of India

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Social and Cultural Environment

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6.2. Microenvironment Analysis

Hindustan Unilever Reliance Industries Tata Group Nirma Ltd.

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6.3. Internal Environment

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