BCG Matrix for ITC Ltd.

Structure

Act I

Lights!

ITC- A Background

Act II

Camera!

The BCG matrix

Act III

Action!

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 ITCs position as one of

Indias most valuable corporations
through world class performance,
creating growing value for the Indian
economy and the Companys
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 &
Safety Matches
Agarbattis

Stationery

Paperboards & Packaging

Paperboards & Specialty Papers
Packaging

Business Mix (Contd)

Agri - Business
Agri-Exports

e-Choupal
Leaf Tobacco

Hotels
Group Companies
ITC Infotech; etc.

Business wise Sales data

Business/ Year

Growth
Value (Rs in Crore)
%
2005
2004

FMCG-Cigarettes 8.4

10002.54 9230.27

FMCG-Others

85.2

563.39

304.16

Hotels

124.1

577.25

257.53

Agribusiness

4.2

1780.07

1708.77

Paper & pkg.

24.9

1565.31

1253.29

Net revenue

12.99

13349.58 11815.04

CAGR during FY 2005-2008

Category

CAGR

Growth parameters

Cigarettes

10.9 %

Pricing power

Hotels

22.7%

Inward traffic, occupancy

Paper

17.2 %

Capacity utilization, value

added products

Agri
business

34.3 %

E-choupal, choupal sagar,

FMCGOthers

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.

Segment

Dominance

Cigarettes

70% share

Paper &
Packg.

Contribution %
Revenue
PBIT
77.0%

87.7%

Packaging board No.

1 in Asia

7.3%

10.7%

Agri
business

1of the largest xporters

from India

7.0%

3.7%

Hotels

ITC Group ranks No.2

4.3%

5.4%

FMCG
(Others)

20% share of greeting

cards market,
'Aashirvaad' atta is
No.1 in branded
segment

4.4%

-7.5%

A
c
t
2

Market attractiveness & Competitive

strength is also important.

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

FMCG- Others

Paperboards/
Packaging.
Agri business.
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 (Contd)

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.