ITC Announces ₹20,000 Crore Investment Plan for Next 5 Years.

Diversified conglomerate ITC plans to invest approximately ₹20,000 crore over the next five years, with a significant portion allocated to its non-cigarette FMCG business.

"Despite the headwinds, the investments made across all our businesses to enhance structural competitiveness and build an enterprise of the future position our company well to leverage emerging opportunities in the market. Our confidence in the India story is unwavering and is reflected in our company’s investment outlay of about ₹20,000 crore in the medium term," ITC Ltd Chairman and Managing Director Sanjiv Puri said during the company's annual general meeting on Friday.

During an interaction with mediapersons, Puri elaborated that roughly 35-40 percent of the planned investment would go into the non-cigarette FMCG business. "Another third or a little less than that will be going into Paperboards & Packaging. The balance will get into other businesses such as Agri, our traditional business, and certain other investments," he explained.

These investments aim to augment capacity, upgrade, modernize, and foster innovation. For the non-cigarette FMCG business, the funds will be directed towards Consumer Goods Manufacturing and Logistics (ICML) facilities, adding new capacities, upgrading product quality, and introducing more innovations.

The company plans to launch a new brand, "Rightshift," targeting consumers aged 40 and above. This brand will include a food product portfolio featuring meals, snacks, and drinks, all developed with proprietary formulations at ITC Life Sciences and Technology Centre (LSTC) in Bengaluru. "These are all completely natural products," Puri said.

Puri also highlighted ITC's strategic investments in neighboring markets, such as the FMCG facility established by the company's subsidiary, Surya Nepal. He mentioned that ITC is exploring exports to a large number of countries and is looking at more strategic presences in international markets, including local manufacturing and brand building.

Regarding the Paperboards & Packaging segment, Puri said the Bhadrachalam unit in Telangana is "fairly saturated," and the company is seeking a site for a greenfield project.

Puri confirmed that the proposed demerger of the hotels business is "on track" and expected to be completed within a few months. On August 14, 2023, the board approved the demerger of the hotel business into a separate entity, ITC Hotels, following shareholder approval in June.

The asset-right strategy for ITC Hotels will continue to focus on proximal markets, Puri said. This strategy, along with the impending move to establish ITC Hotels as a pure-play entity, promises an exciting future.

The company aims to expand its hotel footprint to over 200 properties in the coming years, contributing to employment generation. In the last 24 months, ITC has opened 32 hotels, bringing the total to nearly 140.

ITC Infotech, a wholly-owned subsidiary, has sustained its growth momentum and global expansion through capability-led strategic partnerships. Puri stated that the focus is on building ITC Infotech into a significant growth engine, akin to the FMCG business. While there are no immediate plans for an IPO for the IT arm, Puri acknowledged that it remains a future possibility.

HBL