Itc Limited · NSE:ITC
Itc — Investor Presentation (October 2018)
61 slides from Itc's investor presentation, October 2018
Slide 1: ITC Limited
ITC Limited One of India’s Most Admired and Valuable Companies 1
Slide 2: Profile
Profile One of India’s most Admired and Valuable companies - Market Capitalisation: ~Rs. 3.6 lakh crores A US$ 10 billion enterprise by Gross Sales Value^ - ~59% of Net Revenue from non-Cigarette segments Leading Fast Moving Consumer Goods (FMCG) marketer in India - Established 25 world-class
Slide 3: ITC Performance Track Record
ITC Performance Track Record (` crs) 22-yr Cagr 1995-96 2017-18 95-96 to 17-18 Net Revenue 2,536 39,255 13.3% PBT 452 16,439 17.7% PAT 261 10,953 18.5% Capital Employed 1,886 53,336 16.4% Segment ROCE% 36.3 69.0 Market Capitalisation 5,571 3,12,308 20.1% Total Shareholder Returns % 22.4% Sensex (CAG
Slide 4: ITC's ranking
ITC’s ranking Amongst all listed private sector cos. PBT: No. 5 PAT: No. 5 Market Capitalisation: No. 5 Note: Based on Published Results for FY18, Market Capitalisation based on BSE closing as on 30th Jun 2018 4
Slide 5: ITC's Economic Contribution to the Nation
ITC’s Economic Contribution to the Nation 10 year Value addition ~ Rs. 3.1 lakh crore (US$ 55 billion) – Among the top tax payers in the country – Over the last five years, the Value-Added by your Company, i.e. the value created by the economic activities of your Company and its employees, aggrega
Slide 6: Social Performance
Social Performance Direct employment ITC Group : over 32,000 Supported creation of around 6 million sustainable livelihoods e-Choupal: world’s largest rural digital infrastructure serving more than 4 million farmers Social and Farm forestry initiative has greened nearly 683,000 acres and gen
Slide 7: Environmental Performance
Environmental Performance Water positive - 16 years in a row Carbon positive enterprise – 13 years in a row Sequestering over twice the amount of CO2 that the Company emits Solid waste recycling positive – 11 years in a row Over 43% of total energy consumed is from renewable sources Sust
Slide 8: ITC's Vision Statement
ITC’s Vision Statement Be A ‘Enduring Value (— ) Sustain ITC’s position as one of India’s most valuable and admired corporations through world-class performance, creating growing value for the Indian economy and the Company’s stakeholders Ne y,
Slide 9: ITC's Vision
ITC’s Vision Make a significant and growing contribution towards : • mitigating societal challenges • enhancing shareholder rewards By • creating multiple drivers of growth while sustaining leadership in tobacco, and • focusing on ‘Triple Bottom Line’ Performance Enlarge contribution to the Nati
Slide 10: Key Corporate Strategies
Key Corporate Strategies Focus on the chosen business portfolio – FMCG; Hotels; Paperboards, Paper & Packaging; Agri Business; Information Technology Blend diverse core competencies residing in various Businesses to enhance the competitive power of the portfolio Position each business to attai
Slide 11: Strategy of Organisation
Strategy of Organisation 3-Tiered Governance Structure 11
Slide 12: ITC's Business Portfolio
ITC’s Business Portfolio FMCG Cigarettes Foods Personal Care Lifestyle Retailing Education & Stationery Safety Matches & Incense Sticks Paperboards, Paper Information Hotels Agri Business & Packaging Technology 12
Slide 13: ITC's Cigarettes Business
ITC’s Cigarettes Business Market leadership − Leadership across all segments - geographic & price State-of-the-art technology and world-class products 13
Slide 14: Cigarette Industry in India
Cigarette Industry in India Legal cigarettes account for only ~10% of tobacco consumed in India due to a punitive and discriminatory taxation and regulatory regime India is the 4th largest illegal cigarette market in the World; resulting in Revenue loss of over 13,000 cr. p.a. to the Exchequer
Slide 15: Legal Cigarettes contribute 87% of Tax Revenue
Legal Cigarettes contribute 87% of Tax Revenue, despite constituting only 10% of Tobacco consumption 10% 90% Consumption Share Tax Revenue Share Cigarette taxes remain, effectively, about 50 times higher than on other tobacco products (on a per Kg basis of tobacco consumption) Note: Consumption Shar
Slide 16: Cigarettes are least affordable in India
Cigarettes are least affordable in India Source : WHO Report on the Global Tobacco Epidemic, 2015-Raising Taxes on Tobacco Cigarette taxes in India are 14 times higher than USA, 9 times higher than Japan, 7 times higher than China, 5 times higher than Australia and 3 times higher than Malaysia and
Slide 17: Per Capita Consumption of Tobacco in India
Per Capita Consumption of Tobacco in India (gms per year) Source:World Cigarettes – ERC Statistics, Tob Board & Industry Estimates – gms/Yr Per Capita consumption is ~60% of World Average 17
Slide 18: Per Capita Cigarette Consumption – 11% of World average
Per Capita Cigarette Consumption – 11% of World average Source: The Tobacco Atlas - 4th Edition (American Cancer Society) • Although India accounts for over 17% of world population, its share of world cigarette consumption is less than 2% • Per Capita consumption in India ~11% of World average 18
Slide 19: FMCG Cigarettes
FMCG Cigarettes • Legal cigarette industry volumes remain under pressure − While the legitimate cigarette industry has declined steadily since 2010-11 at a compound annual rate of 4.8% p.a., illegal cigarette volumes in contrast have grown at about 5% p.a. during the same period, making India one of
Slide 20: Creating World-class brands for Indian Consumers
Creating World-class brands for Indian Consumers 20
Slide 21: Rapid scale up of FMCG businesses
Rapid scale up of FMCG businesses (` crs) Note: Reported Gross Revenue for FY18 not comparable a/c GST transition; Comparable FMCG Business growth for FY18 at 11.3% as compared to reported growth of 7.8% 21
Slide 22: Annual Consumer Spends of ~16000 cr. (FY18)
Annual Consumer Spends of ~16000 cr. (FY18) >4000 cr. >3500 cr. >2000 cr. >1000 cr. >500 cr. 22
Slide 23: Branded Packaged Foods Portfolio
Branded Packaged Foods Portfolio Biscuits, Staples, Snacks, Noodles & Pasta, Confectionery, Ready to Eat, Juices, Dairy, Chocolates and Coffee 23
Slide 24: Fabelle Chocolate
Fabelle Chocolate Ganache Fabelle Chocolate Boutique at ITC Sonar Gianduja Fabelle Limited Edition Creations Fabelle Société de Chocolat Fabelle As You Name It 24
Slide 25: Branded Packaged Foods: Some recent launches (1)
Branded Packaged Foods: Some recent launches (1) Bounce Minis Sunfeast Bounce Dark Fantasy Choco Sunfeast Marie Fabelle Visible Strawberry Cakes Jellifills Cake Light Vita Inclusions Bingo! Mad Angles Bingo! Mad Angles Bingo! Tedhe Medhe Sunfeast YiPPee! Candyman Very Peri Peri Fillos Wakhra Style W
Slide 26: Branded Packaged Foods: Some recent launches (2)
Branded Packaged Foods: Some recent launches (2) Fabelle centre-filled chocolate bars Bingo! No Rulz Sunfeast YiPPee! Mood Masala Sunfeast Farmlite Candyman Chatpata Phalsa Masala Jamun Protein Power Crunchy Peanut Juice 26
Slide 27: Sharpening communication & consumer engagement
Sharpening communication & consumer engagement Dark Fantasy – Can’t Wait Wont Wait Campaign B Natural - Not from concentrate campaign. YiPPee! Mood Masala campaign Mom’s Magic – ‘Dil ka Tukda’ campaign 27
Slide 28: Integrated Manufacturing and Logistics facilities
Integrated Manufacturing and Logistics facilities – Commissioned state-of-the-art facilities at Panchla, Kapurthala, Uluberia, Mysuru and Guwahati; Capacity utilisation progressively ramped up. – Steady progress is being made towards development of other such facilities which are expected to be comm
Slide 29: Personal Care Products
Personal Care Products The Business continues to enhance market standing in the Fragrance and liquids (handwash & bodywash) categories. ‘Engage’ range of deodorants continue to strengthen its market standing. − Clear No. 2 brand in the category; No. 1 in Women’s segment. − ‘Pocket Perfume’ range
Slide 30: Personal Care: Some recent launches
Personal Care: Some recent launches Vivel Bodywash Dermafique range of Nimyle Herbal Floor Premium Skincare Cleaner Engage On Flip pack Savlon Chota Bheem Savlon Hand Sanitizer Gel Fiama Bath Essentials Handwash 30
Slide 31: Sharpening communication & consumer engagement
Sharpening communication & consumer engagement Deepening consumer engagement in Vivel anchored on Women’s Empowerment through ‘AbSamjhautaNahin’ & ‘Know Your Rights’ initiatives Savlon ‘Healthy Hands Chalk Sticks’ initiative won 7 Lions at Cannes 2017 and Grand Prix for Creative Effectiveness at Can
Slide 32: Education & Stationery Products Business
Education & Stationery Products Business Leverage Company’s paper & printing expertise and distribution network - Classmate, Saathi and Paperkraft brands continue to enhance market standing Industry growth driven by increasing literacy and enhanced scale of government and public- private educati
Slide 33: Lifestyle Retailing
Lifestyle Retailing • ‘Wills Lifestyle’ brand positioned at the premium end of the market − The brand is available in ~350 outlets across multiple channels including six exclusive boutique stores across ITC Hotels • ‘John Players’ brand positioned in the youth fashion segment – The brand is availabl
Slide 34: Incense sticks (Agarbattis) & Safety Matches
Incense sticks (Agarbattis) & Safety Matches • ‘Mangaldeep’ continues to fortify its market standing in the Agarbatti and Dhoop segment. • ‘AIM’ continues to be the largest selling safety matches brand in India. • Launched in September 2016 on both Android & iOS platforms the Mangaldeep App is curre
Slide 35: Hotels
Hotels • One of the fastest growing hospitality chains in India •Trailblazer in Green Hoteliering • Leader in Profitability 35
Slide 36: Hotels & Tourism industry
Hotels & Tourism industry Foreign Tourist Arrivals (FTA) growth has picked up in the last few quarters. – FTA into India crossed the 10 million mark but remains far behind China (~59 million) [Source: Ministry of Tourism, UNWTO Tourism Highlights 2017 edition] – Going forward, as economic conditio
Slide 37: Hotels Business
Hotels Business The Chain: 107 properties across 72 locations − 4 Brands: ITC Hotels, WelcomHotel, Fortune & WelcomHeritage • 26 Five-Star Deluxe/ Five-Star Properties with over 4800 rooms • 46 Fortune Hotels with over 3600 rooms • 35 WelcomHeritage Properties with over 800 rooms Projects underw
Slide 38: ITC Kohenur launched on 1st June 2018
ITC Kohenur launched on 1st June 2018 Restaurants & Banquet Ottimo Dum Pukht-Begum’s Yi Jing Deccan State room 38
Slide 39: ITC Hotels: Trailblazer in Green Hoteliering
ITC Hotels: Trailblazer in Green Hoteliering All ITC Luxury Hotels LEED Platinum certified “Responsible Luxury” ethos woven into the Brand Identity 39
Slide 40: Paperboards & Packaging Business
Paperboards & Packaging Business • No. 1 in Size • No. 1 in Profitability • World-class Environmental Performance 40
Slide 41: Indian Paperboard market
Indian Paperboard market Annual paperboard demand over 3.1 million tonnes Low per capita usage of paper at around 13 kgs p.a. (world average – over 57 kgs p.a.) Indian paperboard market growing at 7.2% p.a. Value-added Paperboards - the fastest growing segment (10.5% p.a.) in India driven by
Slide 42: ITC's Paperboards, Paper & Packaging businesses
ITC’s Paperboards, Paper & Packaging businesses Market leader in Value-Added Paperboards segment World-class technology & quality – Fully integrated Ozone bleached Pulp Mill (3.5 lakh TPA) – one of its kind in Asia meeting world-class environmental standards – India’s first Bleached Chemical The
Slide 43: Agri Business
Agri Business • Leading Agri Business player in India • Pioneer in rural transformation • No. 1 in Leaf Tobacco 43
Slide 44: ITC's Agri Commodity Business
ITC’s Agri Commodity Business Distinctive sourcing capability for ITC’s Branded Packaged Foods Businesses − Identity-preserved superior quality wheat for ‘Aashirvaad’ atta − Superior quality fruit pulp for ‘B Natural’ range of juices − Sourcing support for spices, chip stock potatoes Farm linkag
Slide 45: ITC's Agri Commodity Business
ITC’s Agri Commodity Business e-Choupal: Strategic Thrust Procurement: cost & quality optimisation – strategic sourcing support to the Branded Packaged Foods Businesses – cost-effective sourcing for exports/domestic external business Rural retail – 23 Choupal Saagars operational 45
Slide 46: ITC e-Choupal – Global Recognition
ITC e-Choupal – Global Recognition – World Development Report 2008 published by World Bank – Stockholm Challenge Award 2006 in the Economic Development category which recognises initiatives that leverage Information Technology to improve living conditions and foster economic growth in all parts of t
Slide 47: ITC's Leaf Tobacco Business
ITC’s Leaf Tobacco Business India – the second largest producer of tobacco (World excl. China) However, India’s share is only at 9% of world tobacco trade – Leaf exports declined 4th year in a row to ~178 million Kgs. ITC – India’s largest buyer, processor, consumer & exporter of cigarette tob
Slide 48: ITC - Key Financials – Q1 2018/19
ITC - Key Financials – Q1 2018/19 Gross Revenue for the quarter ended 30th June, 2018 is not comparable with the previous period a/c GST transition. ` Crs Q1 2018-19 2017-18 Goly(%) Gross Sales Value ^ 18,172 16,011 13.5% Gross Revenue 10,722 13,722 -21.9% EBITDA 4,202 3,746 12.2% PBT 4,300 3,945 9.
Slide 49: Gross Segment Revenue – Q1 18/19
Gross Segment Revenue – Q1 18/19 Gross Revenue not comparable with previous period a/c GST transition (` crs) Q4 Q1 2017-18 2018-19 2017-18 Goly(%) Segment Revenue (Gross) 4936 a) FMCG - Cigarettes 5128 8774 (41.6) 3052 - Others 2870 2601 10.3 7988 Total FMCG 7998 11375 (29.7) 408 b) Hotels 341 305
Slide 50: Segment Results – Q1 18/19
Segment Results – Q1 18/19 (` crs) Q4 Q1 2017-18 2018-19 2017-18 Goly(%) Segment Results 3506 a) FMCG - Cigarettes 3558 3274 8.7 91 - Others 50 5 823.0 3597 Total FMCG 3609 3280 10.0 75 b) Hotels 13 5 149.0 124 c) Agri Business 195 235 (17.3) 242 d) Paperboards, Paper & Packaging 296 257 14.9 4039 T
Slide 51: Segment Capital Employed Q1 18/19
Segment Capital Employed Q1 18/19 (` crs) Rs. Cr. Q4 Q1 2017-18 2018-19 2017-18 Mvt Segment Capital Employed 3332 a) FMCG - Cigarettes * 3211 4429 (1218) 5717 - Others 6711 6508 203 9049 Total FMCG 9923 10938 (1015) 4999 b) Hotels 5092 4801 291 2507 c) Agri Business 2561 2725 (164) 5953 d) Paperboar
Slide 52: Headline Financials : FY 17-18
Headline Financials : FY 17-18 Gross Revenue for the year ended 31st March, 2018 is not comparable with the previous period a/c GST transition. (` crs) 2018 2017 Goly % Gross Sales Value ^ 67082 64174 4.5 Gross Revenue 43957 55002 -20.1 PBDIT 15541 14578 6.6 PBT (before exceptional items) 16439 1550
Slide 53: Gross Segment Revenue – FY 17-18
Gross Segment Revenue – FY 17-18 Gross Revenue not comparable with previous period a/c GST transition (` crs) Reported Comparable 2018 2017 Goly (%) 2018 2017 Goly a) FMCG - Cigarettes 22894 34002 -32.7 43926 41850 5. - Others 11329 10512 7.8 12661 11377 11 Total FMCG 34223 44514 -23.1 56587 53227 6
Slide 54: Segment Results – FY 17-18
Segment Results – FY 17-18 (` crs) 2018 2017 Goly (%) a) FMCG - Cigarettes 13341 12514 6.6 - Others 164 28 483.6 Total FMCG 13505 12542 7.7 b) Hotels 140 111 26.0 c) Agri Business 849 906 -6.3 d) Paperboards, Paper & Packaging 1042 966 7.9 Total 15536 14525 7.0 Less: i) Finance Cost 87 23 ii) Unallo
Slide 55: Awards & Accolades (1)
Awards & Accolades (1) One of the foremost in the private sector in terms of : – Sustained value creation – Operating profits – Cash Profits – Contribution to Exchequer ITC won the prestigious Porter Prize 2017 for 'Excellence in Corporate Governance and Integration' and for its exemplary contri
Slide 56: Awards & Accolades (2)
Awards & Accolades (2) Harvard Business Review ranked ITC Chairman Y C Deveshwar as the 7th Best Performing CEO in the World. Chairman Y C Deveshwar was conferred the Padma Chairman Y C Deveshwar conferred the Bhushan by the Indian Visionary - Business Leader Award by Government of India The Economi
Slide 57: Awards & Accolades (3)
Awards & Accolades (3) AIM Asian CSR Rainforest Businessworld Award by the Alliance FICCI CSR Asian Forum on awarded ITC's award in Large Corporate Bhadrachalam Enterprise Social Unit, the Forest category Responsibility Stewardship Council Forest Management certification ITC Hotels awarded the Best
Slide 58: Recent Awards & Accolades (1)
Recent Awards & Accolades (1) ‘Engage’ won a Gold at Abby (India's biggest advertising and creative award) for its social and digital campaign. The ‘Engage’ campaign on social media also won two Golds at the Content Marketing Awards, South Asia. ‘Savlon Healthy Hand Chalk Sticks’ the first Indian br
Slide 59: Recent Awards & Accolades (2)
Recent Awards & Accolades (2) ITC Limited was recognised and felicitated as the ‘Corporate Trailblazer’ at the India Today Safaigiri Awards. ITC was the only Corporate to have been presented the Safaigiri Award by India Today. ITC Hotels received global accolades and recognition at The Global Social
Slide 60: Forward-looking Statements
Forward-looking Statements Statements in this presentation describing the Company’s objectives, future prospects, estimates, expectations etc. may be “forward looking statements” within the meaning of applicable securities laws and regulations. Investors are cautioned that “forward looking statement
Slide 61: For More Information & Updates
For More Information & Updates Visit Our Website ITC Corporate App http://www.itcportal.com/default.aspx http://www.itcportal.com/app/itc-apps.aspx Subscribe to News Update http://www.itcportal.com/itcnewsticker/ UserRegistration.aspx 61