ITC-Report-and-Accounts-2023 totally based on personal experience

PROJECT REPORT
On
ITC
M.Com IV Sem –Marketing Management
(Session 2020-21)
THE BHOPAL SCHOOL OF SOCIAL SCIENCES

Submitted To Submitted By
Dr. Amrita Sahu Vidushi Upadhyaya
Associate Professor Roll Number: 19103057
Department of Commerce

CERTIFICATE FROM THE PROJECT GUIDE
This is to certify that the Project Report titled “ITC” is a bonafide work of Vidushi Upadhyaya
enrolment number R150191470100 undertaken for the partial fulfillment of Masters in
Commerce (M. Com) degree of Barkatullah University under my guidance. This project work is
original and has not been submitted earlier for the award of any degree or diploma of any other
University or Institution.
Signature of the Guide
Dr. Amrita Sahu
Associate Professor
Department of Commerce,
BSSS, Bhopal

DECLARATION
I Vidushi Upadhaya daughter of Vinod Upadhaya certify that the project report entitled
on “ITC”, prepared by me is my personal and is authentic work under the guidance of Dr. Amrita
Sahu, Associate Professor, Department of Commerce.
Date: 15/06/2021 Signature of the Student-
Place: BHOPAL Name: Abhishek Singh
Class: M.COM (IV SEMESTER)
Roll Number: 19103057

INDEX:
1. INTRODUCTION TO COMPANY
2. OBJECTIVES OF ANALYSIS OF COMPANY
3. ANALYSIS
4. SUGGESTIONS
5. CONCLUSION

INTRODUCTION TO ITC
INDIAN TOBACCO COMPANY (ITC) was incorporated on August 24, 1920 under the
name Imperial Tobacco Company of India Limited. In recognition of the ITC’S multi
business portfolio encompassing a wide range of business. Established in 1910, ITC limited
is a diversified conglomerate with business spanning fast moving consumer goods,
comprising foods, personal care, cigarettes and cigar, branded apparel, education & stationary
products, incense sticks and safety matches, hotels, paperboards and packaging, Agri business
and information technology. ITC’s aspiration to be an exemplar in sustainability practices is
manifest in its status as the only in the world, of its size and diversity, to be
carbon, water and solid waste recycling positive.
ITC’s business and value chains create sustainable livelihoods for more than 6 million people,
a majority of whom represent the poorest in rural India. ITC is the country’s leading FMCG
marketer, the clear market leader in the Indian paperboard and packaging industry, a globally
acknowledged pioneer in farmer empowerment through its wide-reaching Agri business, a
prominent noted chain in India that is trail blazed in “responsible luxury”.

ITC’s wholly- owned subsidiary, ITC infotech, is a specialized global digital solutions
provider. ITC’s new consumer goods business have established a vibrant portfolio of
25-world-class Indian brands that create and retain value in India. ITC’s world class FMCG
brands including Aashirwaad, sunfeast, yippee!, bingo !, B Natural, ITC Master chef, Fabelle,
sunbean, fiama, vivel. Savlon, classmate, paperkraft, mangaldeep, aim and other have
garnered encouraging consumer franchise within a short span of time.
The competitiveness of ITC’s diverse business rest on the strong foundations of institutional
strength derived from in deep consumer insights, cutting-edge Research and Development,
differentiated product development capacity, brand building capacity, world-class
manufacturing infrastructure, extensive rural linkages, efficient trade marketing and
distribution network and dedicated human resources. ITC’s ability to leverage internal
synergies residing across its diverse business lends a unique source of competitive advantage
to its products and services.
ITC’s ‘Nation First: sab saath badhein’ philosophy underlines its core belief in building a
globally competitive and profitable Indian enterprise that marks an exemplary contribution to
creating larger societal value. ITC is the only enterprise in the world of comparable dimensions
to be carbon-positive, water positive and solid waste recycling positive for over adecade now.

ITC’s ‘Wellbeing Out of Waste Program (WOW)’, that comprehensively address the problem
of solid waste management of which plastic is a significant component, provides an end to
end sustainable and scalable solution that has reached out to many citizens in the country.
ITC has implemented largescale interventions in climate-smart and sustainable agriculture that
make a meaningful contribution to the hon’ble Prime Minister’s vision of doubling farmers
incomes. ITC has launched an integrated program titled ‘Baraah mahine hariyali’ to give a
new dimension to the complex task of multiplying farmer incomes. ITC is investing inIndia’s
future by building world-class consumer goods and factories and iconic hospitality
and that will contribute to the country’s competitive capacity. These investment projects
underpin the company’s support to the Government’s ‘Make in India’ vision.

OBJECTIVES OF ANALYSIS
Industry analysis is a market assessment tool used by business and analysis to understand the
competitive dynamics of an industry. It helps them get a sense of what is happening in an
industry, for example, demand-supply statistics, degree of competition within the industry,
state of competition etc. It helps them to identify both the opportunities and threats coming
their way and gives them a strong idea of the present and future scenario of the industry. It is
crucial because it helps a business understand market conditions. It helps them forecast demand
and supply and consequently, financial returns from the business. It indicates the
competitiveness of the industry and cost associated with entering and existing the industry.
Analysis helps to identify which stage an industry is currently in, whether it is still growing
and there is scope to reap benefits or has it reached in saturation point.
OBJECTIVES OF INDUSTRYANALYSIS:
□ To understand how industry structure derives competition, which determines the
levelof industry profitability.
□ To assess industry attractiveness.
□ To use evidence on changes in industry structure to forecast future profitability.
□ To formulate strategies to change industry structure to improve industry profitability.
□ To identify key success factors.

TYPES OF INDUSTRYANALYSIS:
1. COMPETITIVE FORCES MODEL (PORTER’S FORCES):
According to Porter, analysis of the five forces gives an accurate impression of the
industry and makes analysis easier. The five forces are:
□ Intensity of industry rivalry.
□ Threat of potential entrants.
□ Bargaining power of suppliers.
□ Bargaining power of buyer.
□ Threat of substitute goods and services.
2. BROAD FACTORS ANALYSIS (PESTLE ANALYSIS):
It is commonly called the PESTLE analysis stands for Political, Economic, Social and
Technological. PEST analysis is a useful framework for analyzing the external
environment.
3. SWOTANALYSIS:

It stands for Strength, Weakness, Opportunities and Threats. It can be a great way of
summarizing various industry forces and determines their implications for the
business in question.

ANALYSIS
1. PORTER’S MODEL:
□ THREAT OF NEW ENTRANTS:
Threat of new entrants reflects how new market players impose threats to
the existing market players. If the industry will be profitable and barriers to
enter the industry will be low, it will attract more players and hence, the
threat of new entrants will be high.
ITC limited India will be facing high new entrants’ threat if:
- Existing regulations support the entry of new players.
- Consumers can easily switch the brands due to weak or no brand
loyalty.
- Initial capital investment is low.
- Building a distribution network is easy for new players.
- Retaliation from the existing market players is not a discouraging
factor.
Threats for new entrants:
- New product differentiation is very tough
- Access to distribution channels is tough.
- Capital requirements is very high.
- High taxes.
□ THREAT OF SUBSTITUTE PRODUCTS OR SERVICES:
The availability of substitute products or services makes the competitive
environment challenging for ITC ltd., and other existing players. High

substitute threat shows that customers can use alternative products/
services from other industries to meet their need. Various factors
determining the intensity of this threat for ITC limited.
Threats of substitute products or services:
- A cheaper substitute product/service is available from other industry.

- The psychological switching costs of moving from industry to
substitute products are low.
- Substitute product offer the same or even superior quality
andperformance as offered by ITC ltd India first’s product.
Although, the threat is substantially low:
- The switching cost of using the substitute product is high.
- Customers cannot derive the same utility from substitute product
asthey derive from the ITC.
Threat of substitute goods:
- Herbal cigarettes have failed.
- Nicotine patch have failed.
- Nicotine gums have also failed.
- Electronic cigarettes are almost failed.
□ RIVALRYAMONG EXISTING FIRMS:
The rivalry among existing firms shows the member of competitors that
give tough competition to the ITC ltd. High rivalry shows ITC ltd., India
can face strong pressure from the rival firms, which can limit each other’s
growth potential.
The rivalry factors which are a major strategic concern for ITC Ltd.:
- The company will face intense rivalry among existing firms if market
players are strategically diverse and target the same market.
- The rivalry will also be intense if customers are not loyal with existing
brands and it is easier to attracts other customers due to low switching
cost.
- Competitors with equal size and offering undifferentiated products
with slow industry growth tend to adopt aggressive strategies
againsteach other.
The rivalry factor will be low if:

- There are only a limited number of players in the market.
- The industry is growing at a fast rate.
- There is a clear market leader.
- The products are highly differentiated and each market player
targetsdifferent sub segments.
- The economic/psychological switching costs for consumers are high.

- The exit barriers are low, which means firms can easily leave
theindustry without incurring huge losses.
Rivalry among competitors:
- Many competing players.
- Price competition continues
- Banned on advertisements for cigarettes
- Holds major market share.
□ BARGAINING POWER OF SUPPLIERS:
- It reflects the pressure exerted by supplier on business organizations
byadopting different tactics like reducing the product availability,
reducing the quality or increasing the prices.
- High supplier bargaining power can increase the competition in
theindustry and lower the profit and growth potential for ITC Ltd.
- Weak supplier power can make the industry more attractive due to
highprofitability and growth potential.
Bargaining power of supplier will be high for ITC Ltd.:
- Suppliers have concentrated into a specific region and
theirconcentration is higher than their buyers.
- This force is particularly strong when the cost to switch from
onesupplier to other is high for buyers.
- When suppliers are few and demand for their offered product is high,
itstrengthens the supplier’s position against ITC Ltd.
- Suppliers’forward integration weakness the ITC Ltd., position as they
also become the competition in that area.
- If ITC Ltd., is not well educated, does not have adequate market
knowledge and lacks the price sensitivity, it automatically
strengthensthe suppliers’position against the organization.
- Other factors – high product differentiation offered by suppliers,
inputsrequired but in small amounts, direct access to distribution
channels.

The bargaining power of suppliers will be low for ITC Ltd.:
- Suppliers are not concentrated.
- Switching costs are low.
- Product lacks differentiation.
- Substitute products are available.

- ITC Ltd., is highly price sensitive and has adequate market knowledge.
□ BARGAINING POWER OF BUYERS:
- Bargaining power of buyers indicates the pressure that customers
exerton the business organization to get high quality products at
affordable prices with excellent customer services. This force directly
influences the ITC Ltd., ability to accomplish the business objects.
Strong bargaining power lowers profitability and makes the industry
more
competitive. Whereas, when buyer power is weak, it makes the industry less competitive
and increase the profitability and growthopportunities for ITC Ltd.
There are some factors that increase the bargaining power of buyer:
- A more concentrated customer base increases their bargaining
poweragainst ITC Ltd.
- Buyer’s power will also be high if there are few in number whereas
anumber of sellers are too many.
- Low switching costs also increases the buyers bargaining power.
- In case of corporate customers, their ability to do backward
integrationstrength their position in the market. Backward
integration shows the buyers ability to produce the products
themselves instead of purchasing them from ITC Ltd.
- Consumers’price sensitivity, high market knowledge and purchasing
standardized products in large volumes also increase the buyers
bargaining power.
Factors that decrease the bargaining power of buyers include:

- Lower customer concentration
- Customer’s inability to integrate backwards
- Low price sensitivity
- Lower market knowledge
- Higher switching costs
- Purchasing customized products in smaller
volumesPORTER’S 5 FORCE MODEL IMPLICATIONS:

□ The application of Porter five forces model in real world content allows
organizations to make wise strategic decisions. Impact and importance
ofeach of the five forces is context dependent. By using Five force
analysisITC Ltd., can determine the industry attractiveness, make
effective
entry/exist decisions and assess the influence of these forces on their own
business and competitors. Mostly, this model is considered as a starting
point and other frameworks are used in conjunction for a better
understanding of the external environment.
CONCLUSION ANALYSIS:
□ Threat of new entrants – LOW
□ Bargaining power of suppliers – LOW
□ Bargaining power of buyers – LOW
□ Threat of substitute products – LOW
□ Rivalry among competitors – HIGH
2. BROAD FACTORS ANALYSIS (PESTANALYSIS):
Broad factors analysis, also commonly called the PEST analysis stands for
Political, Economic, Social and Technological. PEST analysis is a useful
framework for analyzing the external environment.
To use PEST as a form of industry analysis, an analyst will analyze each of the 4
components of the model:
1.) POLITICAL: Political factors that impact an industry include specific policies
and regulations related to things like taxes, environmental regulations, tariffs,
trade policies, labor laws, ease of doing business and overall political stability.
2.) ECONOMIC: The economic forces that have an impact include inflation,
exchange rates, interest rates, GDP growth rates, conditions in the capital
market etc.
3.) SOCIAL: The social impact on an industry refers to trends among people and
includes things such as population growth, demographics (age, gender etc.)
and trends in behavior such as health, fashion and social movements.

4.) TECHNOLOGICAL: The technological aspects of PEST analysis incorporate
factors such as advancements and developments that change the way a
business operates and the ways in which people live their lives.

ITC PESTLE ANALYSIS:
1.) POLITICAL FACTORS: The organization needs to follow various policies
that apply across the regions of its operations. Keeping a tab on the changing
policies is a mandate that the company needs to undertake, be it local or
national. The better stability of the government, the higher is the ease of
working in that region. There are various opportunities that ITC can utilize
and thus making it a strength rather than just a policy to be followed.
Considering the taxation policy, misuse related to discriminatory taxation
policy were eradicated and a new taxation system, that classifies these
products in a better way was introduced in India. Through GST has
reduced the effect of discriminatory taxation, the products continue to
be taxed. This has increased the expenditure of the company, to
monitor the changing cost of raw materials and the different tax slabs
they fall into. On the bright side, the FMCG market in India is expected
to triple in size by 2020, to Rs. 4,00,000 crores. This provides the
company with an opportunity to seize the opportunity of becoming a
market leader in various segments, by working in close ties with the
local governments as well as the central governments. The trade wars
between countries are expected to affect the business of the
organization, but yet the recent trade agreements signed by India with
various countries may rule out the intensity of the trade war.
2.) ECONOMIC FACTORS: With India being a developing country, the more
stable the economic policies higher will be the disposable income, and better
will be the standard of living. This will benefit the company since it believes
in the development of all. The company preaches this thought through its
tagline “sab sath me badhein”. With any changes in the policies relating to
income, there will be a sharp change in the consumption of necessity goods. It
may be higher or lower depending upon the new policy. Any event that causes
a currency devaluation or fluctuation in the currency values, especially in the
developing markets. Further a change in the capital controls, government
currency policies such as demonetization in India, or others, increase the
restrictions to the trade of raw materials or finished products to and from
different countries. ITC has invested over 6000 crores in the last decade and

created employment for over 20,000 employees directly and approximately 5
million people indirectly.

3.) SOCIAL FACTORS: A slight change in the operations of the company can
affect its profitability of a large scale, thus staying updated with the recent
trends popular among the population is a must. The quality of its products is of
prime concern to ITC. Any deviation from the standard quality that the society
expects, is a major setback for the company. Since these products are seen as a
negative element in the society, the company needs to take due care that it
does not promote such products actively. The ban on advertising products on
social media platforms keeps a check on the promotional activities of the
company. Since the concern for these products has increased in the society,
and with the need for overall health status improvement of the society, the
company needs to make sure that it clearly states the use of any sort of
harmful products across its entire product line. The society is concerned with
the growing consumption of these products by minor-aged i.e. people below
the age of 18. The company needs to make sure that it runs proper awareness
programs, and proper information is transmitted through various platforms, to
prevent minor people from consumption of these products. The ability of the
company to success lies in its capability to analyze the changing trends and
grasp the requirements of the consumers. Only through continuous analysis
can the organization maintain its status in the market. Innovation is something
that the consumers expect of the company. The company believes in effective
growth for the country and believes in strengthening the rural areas in the
country. The company has undertaken various CSR initiatives to empower the
impoverished farmers, with one of its initiatives being the e-Choupal. A major
impact on the development and growth of the company comes from the level
of talent of the workforce employed. With a higher level of skills and
education, the company can employ more people and thus enrich society as
well as increase its profitability.

4.) TECHNOLOGICAL FACTORS: The company has undertaken various
initiatives on the technological end to stay relevant in the market. It utilizes the
various social media platforms to describe the various changes that are being
brought about by the company for the betterment of society. It also markets
and promotes its various products through the utilization of media to create an
emotional connect with its consumers. The company has recently launched the
first multi-layer plastic collection and recycling unit in Pune. Through this
venture, the company believes in creating a more sustainable environment
through the use of advanced technology. The company has set up established
new systems to constantly monitor all its operations and supply chain related
processes. Artificial Intelligence is another area where the organization can try
its luck. Since the world is moving towards digital, and advancement in
technology will help the organization increase its hold in the fields of
consumer engagement and insight discovery, smart manufacturing, agri-value
chains, supply chain agility, etc. With major changes in the paperboards and
packaging industry, ITC stands out with its latest innovations of antifungal
coated cartons, micro-perforation for specific laminates, braille features for
labels and cold seal laminates for chocolates.
3. SWOTANALYSIS:
SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework
used to evaluate a company's competitive position and to develop strategic
planning. SWOT analysis assesses internal and external factors, as well as current
and future potential. A SWOT analysis is designed to facilitate a realistic,
fact-based, data-driven look at the strengths and weaknesses of an organization,
initiatives, or within its industry. The organization needs to keep the analysis

accurate by avoiding pre-conceived beliefs or grey areas and instead focusing on
real-life contexts. Companies should use it as a guide and not necessarily as a
prescription.

SWOT analysis is a technique for assessing the performance, competition, risk,
and potential of a business, as well as part of a business such as a product line or
division, an industry, or other entity.
Using internal and external data, the technique can guide businesses toward
strategies more likely to be successful, and away from those in which they have
been, or are likely to be, less successful. Independent SWOT analysts, investors,
or competitors can also guide them on whether a company, product line, or
industry might be strong or weak and why.
□ STRENGTH: Strengths describe what an organization excels at
and what separates it from the competition: a strong brand,
loyal customer base, a strong balance sheet, unique
technology, and so on. For example, a hedge fund may have
developed a proprietary trading strategy that returns

market-beating results. It must then decide how to use those
results to attract new investors.
□ WEAKNESS: Weaknesses stop an organization from performing at its
optimum level. They are areas where the business needs to improve
toremain competitive: a weak brand, higher-than-average turnover,
highlevels of debt, an inadequate supply chain, or lack of capital.

□ OPPORTUNITIES: Opportunities refer to favorable external factors that
could give an organization a competitive advantage. For example, if a
country cuts tariffs, a car manufacturer can export its cars into a new
market, increasing sales and market share.
□ THREATS: Threats refer to factors that have the potential to harm an
organization. For example, a drought is a threat to a wheat-
producingcompany, as it may destroy or reduce the crop yield.
Other common threats include things like rising costs for materials,
increasing
competition, tight labor supply. and so on.
SWOT Table

Strengths
1. What is our
competitive
advantage?
2. What resources do
we have?
3. What products are
performing well?
Weaknesses
1. Where can we improve?
2. What products are
underperforming?
3. Where are we lacking
resources?
Threats
1. What new
regulations threaten
operations?
Opportunities
1. What technology can we use
to improve operations?
2. Can we expand our core

2. What do our
competitors do well?
3. What
consumertrends
threaten
business?
operations?
3. What new market segments
can we explore?
INTERNAL:

What occurs within the company serves as a great source of information for the
strengths and weaknesses categories of the SWOT analysis. Examples of internal
factors include financial and human resources, tangible and intangible (brand
name) assets, and operational efficiencies.
Potential questions to list internal factors are:
● (Strength) What are we doing well?
● (Strength) What is our strongest asset?
● (Weakness) What are our detractors?
● (Weakness) What are our lowest-performing product lines?
EXTERNAL:
What happens outside of the company is equally as important to the success of a
company as internal factors. External influences, such as monetary policies,
market changes, and access to suppliers, are categories to pull from to create a list
of opportunities and weaknesses.1

Potential questions to list external factors are:
● (Opportunity) What trends are evident in the marketplace?
● (Opportunity) What demographics are we not targeting?
● (Threat) How many competitors exist, and what is their market share?
● (Threat) Are there new regulations that potentially could harm our operations
orproducts?
ITC SWOT ANALYSIS:
● STRENGTHS OF ITC:
- ITC’s cigarette sector contributes a significant proportion of its sales tothe FMCG.
- Portfolio of Companies: under its name, ITC has 6 large and diverse
businesses that boost its total revenue and allow ITC to innovate andpursue other business
opportunities.
- Powerful brand: ITC is a large brand house with most of its products
leading the segments in which it works.
- ITC owns some of the most famous cigarette brands, such as the
GoldFlake and Classic. It also owns Sunfeast, one of India’s highest-
sellingbiscuits. Similarly, the Aashirvaad Chaki Fresh Ata, the Yippee! ,
Engage, John Players, and Bingo are all among the industry leaders in
their respective groups.
- ITC’s hotel and property businesses are also doing well. With a
portfolio like this, ITC has become one of India’s most dominant
conglomerates and is revered all over the world.

- Efficient Social Business Initiatives: The ITC has developed a
three-pronged strategy that focuses on building national
economic,social, and environmental resources.
- ITC has introduced initiatives such as E-Choupal, Choupal Pradarshan
Khet (CPK) that support grass-roots people, i.e. farmers. Such
initiatives have also enabled ITC to boost their brand reputation as a
conventional tobacco producer.
- Inter and Intra-Divisional Synergy: ITC has effectively used the
strengths of core companies to push into newer products or categories.ITC has leveraged the
powerful distribution network of cigarette brands to build a market for its FMCG products.

- In addition, ITC has leveraged the experience of food and bakery
itemsfrom its hotel company to become part of the Packaged Food
group.
- ITC has a large and competent management team. Clear brand
image,outstanding promotional goods Diversified range of products
and
services, including FMCG, hotel chains, paper & packaging, andagribusiness.
- Over 6500 E-Choupal CSR programs and sustainability projects
improve the brand identity of ITC to more than 4 million
farmers.
- ITC has reduced personnel to more than 25.000 employees
Goodservices for research and development.
● WEAKNESS OF ITC:
- High Proportion of Tobacco Product Revenues: ITC has made
continuous efforts to separate the FMCG sector from over-dependenceon tobacco products
and has been successful in doing so to some degree. Nonetheless, tobacco products remain the
biggest source of revenue contributing more than 60 percent to FMCG’s overall revenue.
- Tobacco Products Association has an impact on the brand: ITC has
made a great deal of effort to enhance its corporate image, but the
factthat ITC has many tobacco products in its portfolio has an impact
on its corporate image. The increase in the Tobacco Tax has an
effect onrevenue: due to the rise in the tax on tobacco products,
rates and,
subsequently, profits are affected.
- ITC is still dependent on its tobacco sales, and people have
cheaperalternatives and other brands.
- The hotel industry has not been able to build an enormous
marketshare.

● OPPORTUNITIES OF ITC:
- Acquisitions: ITC will continue to make strategic acquisitions, as it has
done in the past, by purchasing Savlon from Johnson & Johnson and B
Natural from Balan Natural Foods. Keeping in mind that the product
fits into the current distribution network, ITC will try to increase its
product range and broaden its non-tobacco FMCG business and thus
improve its revenue base.
- Growth in purchasing power and changing lifestyles: ITC can tap into
rising buying power and changing customers’lifestyles in India. It will
help to raise sales for all of its companies.
- Growing Personal Hygiene as well as Food Processing Industry in
India: ITC should use its distribution channel in the Personal Hygiene
and Food Processing Industry to capitalize on the growth of
categoriesand thus increase revenue.
- Tap opportunities created in the rural sector: the rising rural sector
inIndia and other developing nations are generating enormous
opportunities to boost the company’s bottom line.
- Mergers and acquisitions are planned to reinforce the brand.

- Increased people’s buying power, thus rising competition.
Moreexposure to hotel chains to increase market share.
● THREATS OF ITC:
- Intensifying rivalry in FMCG companies: ITC is facing intense
competition in its FMCG market from major MNCs such as HUL andP&G and Indian FMCGs
such as Patanjali and Dabur. It limits the market share of the ITC.
- Regulations and Increased Taxation in Cigarette Business: The
Tobacco and Cigarette Industry in India continues to be regulated
by
strict government regulations and the tax system. This poses a threat tothe highly profitable
ITC Cigarette company.
- Increasing health awareness: there has been an increase in health
awareness, which has resulted in a decrease in the demand for tobaccoproducts in India. Anti-
smoking programs throughout the country alsohave an effect on cigarette sales.
- Intense and increasing competition among other FMCG companies and
hotel chains.
- FDI in the retail sector, thereby allowing for international brands.

SUGGESTIONS
● ITC Limited India First can develop brand loyalty by working on customer
relationship management. It will raise psychological switching costs.
● It can develop long-term contractual relationships with distributors to widen
access to the target market.
● ITC Limited India First can also an investment in research and development
activities, get valuable customer data and introduce innovative
products/services to set strong differentiation basis.
● ITC Limited India First can reduce the Threat of Substitute Products or services
by clearly emphasising how its offered product/service is better than the
available substitutes.
● It should provide convincing reasons to the customers by offering a better
experience and high value for money.
● It can raise switching costs by working on loyalty.
● Lastly, it can improve the quality, maximise value for money and set strong
differentiation basis to discourage customers from using the substitute
product.
● ITC Limited India First should focus on the implicit needs and expectations of its
customers to strengthen the differentiation basis. It should raise switching costs by
developing long-term customer relationships. The organisation should also invest in
research and development activities to identify new customer segments. In some
cases, collaborating with competitors can be mutually beneficial. The organisation
can look for this option as well.
● ITC Limited India First can strengthen its position against suppliers by decreasing the
dependency on one or a few suppliers. It will increase its price sensitivity. Developing
the long-term contractual relationships with suppliers from different regions not only
lowers their bargaining power but also allows ITC Limited India First to improve its
supply chain efficiency. Finally, ITC Limited India First can find the alternate ways of
producing the product if product demand is high enough and the firm has required
competencies and expertise. However, it requires detailed cost-benefit analysis to
determine its feasibility. Product redesign and diversification of the product lines can
also help the organisation reduce the suppliers’power in the market.

● ITC Limited India First can manage the bargaining power of buyers by increasing and
diversifying their customer base. It can be done by introducing new products,
targeting new market segments and adopting the product diversification strategies.
Marketing and promotional strategies can also be helpful in this regard. Building
loyalty by embedding innovation and offering excellent customer experience can raise
the switching costs, which will ultimately reduce their bargaining power. ITC Limited
India First can adopt these strategies to strengthen its competitive positioning in the
market.

CONCLUSION
ITC is one of India's foremost private sector companies and a diversified
conglomerate with businesses spanning Fast Moving Consumer Goods,
Hotels, Paperboards and Packaging, Agri Business and Information
Technology. The Company is acknowledged as one of India's most valuable
business corporations with a Gross sales value of ₹ 76,097.31 crores and Net
Profit of ₹ 15,136.05 crores (as on 31.03.2020). ITC was ranked as India's
most admired company, according to a survey conducted by Fortune India, in
association with Hay Group.
Multiple Drivers of Growth:
ITC is the country's leading FMCG marketer, the clear market leader in the
Indian Paperboard and Packaging industry, a globally acknowledged pioneer
in farmer empowerment through its wide-reaching Agri Business, a
pre-eminent hotel chain in India that is a trailblazer in 'Responsible Luxury'.
ITC's wholly-owned subsidiary, ITC Infotech, is a specialized global digital
solutions provider.
Over the last decade, ITC's new Consumer Goods Businesses have established
a vibrant portfolio of 25 world- class Indian brands that create and retain
value in India. ITC's world class FMCG brands including Aashirvaad,
Sunfeast, Yippee!, Bingo!, B Natural, ITC Master Chef, Fabelle, Sunbean,
Fiama, Engage, Vivel, Savlon, Classmate, Paperkraft, Mangaldeep, Aim and
others have garnered encouraging consumer franchise within a short span of
time. While several of these brands are market leaders in their segments,
others are making appreciable progress.

BIBLIOGRAPHY
- https://www.itcportal.com
- https://simconblog.wordpress.com
- https://corporatefinanceinstitute.com
- https://www.mbaskool.com
- https://www.investopedia.com
- https://www.projects4mba.com

ITC-Report-and-Accounts-2023 totally based on personal experience

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