BCG Matrix for ITC Ltd.. Structure Act ILights! ITC- A Background Act IICamera! The BCG matrix Act IIIAction! Learning points and conclusions.

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Presentation transcript:

BCG Matrix for ITC Ltd.

Structure Act ILights! ITC- A Background Act IICamera! The BCG matrix Act IIIAction! Learning points and conclusions

Act –I [Lights!] Governance structure Strategic supervision Strategic management Executive management Core values Nation Orientation; Trusteeship; Excellence; Customer focus; respect for people; Innovation

Vision & Mission statements Vision: Sustain ITC’s position as one of India’s most valuable corporations through world class performance, creating growing value for the Indian economy and the Company’s stakeholders. Mission: To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering superior and sustainable stakeholder value.

Business Mix of ITC Ltd. FMCG Cigarettes Foods Lifestyle Retailing Greeting, Gifting & Stationery Safety Matches Agarbattis Paperboards & Packaging Paperboards & Specialty Papers Packaging CigarettesFoodsLifestyle RetailingGreeting, Gifting & StationerySafety MatchesAgarbattisPaperboards & Specialty PapersPackaging

Business Mix (Cont’d) Agri - Business Agri-Exports e-Choupal Leaf Tobacco Agri-Exportse-ChoupalLeaf Tobacco Hotels Group Companies Group Companies ITC Infotech; etc.

Business wise Sales data Business/ YearGrowth % Value (Rs in Crore) FMCG-Cigarettes FMCG-Others Hotels Agribusiness Paper & pkg Net revenue

CAGR during FY CategoryCAGRGrowth parameters Cigarettes10.9 %Pricing power Hotels22.7%Inward traffic, occupancy Paper17.2 %Capacity utilization, value added products Agri business 34.3 %E-choupal, choupal sagar, FMCG- Others 60.2 %Fast track, decent share.

Market share of ITC Ltd. Outstanding market leader Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports. Gaining market share Nascent businesses of Packaged Foods & Confectionery, Branded Apparel and Greeting Cards.

SegmentDominanceContribution % Revenue PBIT Cigarettes70% share77.0%87.7% Paper & Packg. Packaging board – No. 1 in Asia 7.3%10.7% Agri business 1of the largest xporters from India 7.0%3.7% HotelsITC Group ranks No.24.3%5.4% FMCG (Others) 20% share of greeting cards market, 'Aashirvaad' atta is No.1 in branded segment 4.4%-7.5%

Market attractiveness & Competitive strength is also important. Act2Act2

Limitations Assumes market growth rate. A firm may grow the market. A “Dog” may be helping other products. High market share/Growth is not the only success factor. Linkage between market share and profitability is questionable.

The BCG Matrix for ITC Ltd. Stars Hotels Paperboards/ Packaging. Agri business. ? FMCG- Others Cows FMCG-Cigarettes Dogs Maybe ITC Infotech.

Act III- Action- Learning points and conclusions ? - To be handled with care. Strategic forays into emerging high growth markets. E-Choupal is a transformational strategy. Strong brand building capability will be tested.

Learning points (Cont’d) Corporate strategy of creating multiple drivers of growth anchored on its core competencies and distribution reach. Embracing difficult and challenging corporate strategy. (Ex: Paperboards). EHS philosophy: Contribution to the triple bottom line- Economic, Environment and social capital.