ITC Limited


ITC Limited is an Indian multinational conglomerate company headquartered in Kolkata, West Bengal. Established in 1910 as the Imperial Tobacco Company of India Limited, the company was renamed as the India Tobacco Company Limited in 1970 and later to I.T.C. Limited in 1974. The Company now stands renamed to ITC Limited, where 'ITC' today is no longer an acronym or an initialised form. ITC has a diversified presence across industries such as Cigarettes, FMCG, Hotels, Packaging, Paperboards & Specialty Papers and Agribusiness. The company completed 100 years in 2010 and as of 2019–20, had an annual turnover of US$10.74 billion and a market capitalisation of US$35 billion. It employs over 36,500 people at more than 60 locations across India and is part of Forbes 2000 list.

History

Tobacco business and early years

"ITC Limited" was originally named 'Imperial Tobacco' and was later renamed 'Imperial Tobacco Company of India Limited,' succeeding W.D. & H.O. Wills on 24 August 1910 as a British-owned company registered in Calcutta. Since the company was largely based on agricultural resource, it ventured into partnerships in 1911 with farmers from the southern part of India to source leaf tobacco. Under the company's umbrella, the 'Indian Leaf Tobacco Development Company Limited' was formed in Guntur district of Andhra Pradesh in 1912. The first cigarette factory of the company was set up in 1913 at Bangalore.
Though the first six decades of the company's business was primarily devoted to the growth and consolidation of the cigarette and leaf-tobacco businesses, ITC's packaging & printing business at Munger was set up in 1925 as a strategic backward integration for ITC's cigarettes business. It is today India's most sophisticated packaging house. More factories were set up in the following years for cigarette manufacturing across India.
In 1928, construction began for the company's headquarters, the 'Virginia House' at Calcutta. ITC acquired Carreras Tobacco Company's factory at Kidderpore in 1935 to further strengthen its presence. ITC helped to set up indigenous cigarette tissue-paper-making plant in 1946 to significantly reduce the import costs and a factory for printing and packaging was set up at Madras in 1949. The Company acquired the manufacturing business of Tobacco Manufacturers Limited and the complementary lithographic printing business of Printers Limited in 1953.

Towards Indianization and business diversification

The company was converted into a Public Limited Company on 27 October 1954. The first step towards Indianization was taken in the same year with 6% of Indian shareholding of the company. ITC also became the first Indian company to foray into consumer research during this time. During the 1960's, technology was given more focus on setting up of cigarette machinery and filter-rod manufacturing facilities aimed at achieving self-sufficiency in cigarette-making.
Ajit Narain Haskar became the company's first Indian chairman in 1969 and this was crucial in building up the Indian management for the company. As the company's ownership was progressively Indianised, under Haskar's leadership, the name of the company was changed from 'Imperial Tobacco Company of India Limited' to 'India Tobacco Company Limited' in 1970. ITC also became the first company in India to start from the 1971 Scissor's Cup. Innovative market campaigns and electronic data processing were started in the 1970s.
In 1973, ITC set up its integrated research center in Bangalore, aimed at diversification and venturing into newer businesses with research and development. With the unfolding diversification plans, the name of the company was changed to 'I.T.C. Limited' in 1974. The Indian shareholding grew further to 40% during this time. ITC entered into the hospitality sector with hotel business in 1975 with the acquisition renaming of ITC Welcomgroup Hotel Chola in Madras. ITC chose the hospitality sector for its potential to earn high levels of foreign exchange, create tourism infrastructure and generate large scale direct and indirect employment.
The shareholding went over 60% in 1976 and more hotels were started by the company in the following years. ITC Sangeet Research Academy was set up at Calcutta in 1977. In 1979, ITC entered the paperboards business by promoting ITC Bhadrachalam Paperboards Limited. J N Sapru took over as the company's chairman in 1983 and the international expansion started with the acquisition of Surya Nepal Private Limited in 1985. The year 1986 saw vigorous moves from the company with the opening of an Indian restaurant was in the city of New York, acquisition and renaming of Vishvarama Hotels to ITC Hotels Limited, setting up of two new ventures – the ITC Classic Finance Limited and ITC Agro Tech Limited under its umbrella. ITC also entered into the edible oils industry with the launch of the 'Sundrop' brand of cooking oils in 1988. Tribeni Tissues Limited was acquired in 1990. K L Chugh assumed the role of chairman in 1991 and ITC Global Holding Private limited was started as an international trading company in Singapore in 1992. In 1994, all the hotels under the company were transferred into the listed subsidiary company ITC Hotels Limited. ITC, through the brand 'Wills', sponsored the 1996 Cricket World Cup.
Y.C. Deveshwar took over as the company's chairman in 1996 and the corporate governance structure was re-crafted to support the effective management of multiple businesses. ITC exited from edible oils business and financial services; sold the ITC Classic Finance Limited to ICICI Limited and handled the 'Sundrop' business to ConAgra Foods Limited in 1998. In the year 2000, an innovative initiative for farmers called 'e-Choupal' was started in Madhya Pradesh in 2000. The same year witnessed the launch of ITC's 'Wills Sport' range of casual wear with first retail outlet in New Delhi and ITC's entry into stationery products and gifting business introducing the 'Expressions' range of greeting cards and 'Classmate' notebooks. A wholly owned information technology subsidiary, ITC Infotech India Limited was also started in 2000 and the ITC Bhadrachalam Paperboards Limited was merged into ITC Limited. The name of the company was changed to 'ITC Limited' omitting the dots and adapting the strategy 'No stops for ITC' in 2001. An employee stock option scheme was introduced for the first time and a web portal for the company was launched. Subsidiaries for ITC Infotech were set up at United Kingdom and the USA.
On July 27 2020, ITC has acquired 100 per cent of the equity share capital of Sunrise Foods in a 2150 crore deal. Consequent to it, Sunrise and its two subsidiaries, Sunrise Sheetgrah Private Ltd and Hobbits International Foods Pvt Ltd, have become wholly-owned subsidiaries of ITC, it added. Sunrise is a market leader in eastern India in the fast-growing spices category and has a brand legacy of over 70 years.

Products and brands

Cigarettes

ITC Ltd sells 81% * of the Cigarettes, Bidi in Asia, where 275 million people use tobacco products and the total cigarette market is worth close to $11 billion.
ITC's major cigarette brands include Wills Navy Cut, Gold Flake Kings, Gold Flake Premium lights, Gold Flake Super Star, Insignia, India Kings, Classic, 555, Silk Cut, Scissors, Capstan, Berkeley, Bristol, Lucky Strike, Players, Flake and Duke & Royal,wave.

Other businesses

ITC's equity shares are listed on Bombay Stock Exchange, National Stock Exchange of India and Calcutta Stock Exchange. The company's Global Depository Receipts are listed on the Luxembourg Stock Exchange. ITC is part of 2 major Stock Market Indices of India which are NIFTY of National Stock Exchange & Sensex of Bombay Stock Exchange.

Employees

Per the Annual report of the company, it had 25,963 employees as on 31 March 2013, out of which 3,043 were women. It spent Rs. 2,145 crores on Employee benefits during the FY 2012–13. During the same year, its attrition rate was 12%.
ITC's Chairman Y C Deveshwar won renowned awards and recognition including Padma Bhushan from Govt. of India 2005–09, by Boston Consulting Group and seventh-best-performing CEO in the world by Harvard Business Review.
Meera Shankar, Indian ambassador to the USA between 2009 and 2011, joined the board of ITC Limited in 2012 as the first woman director in its history. She is an additional non-executive director of the company.