ITC and its various segments

ITC SEGMENTS WISE DETAILS

ITC which was initially named as Imperial Tobacco Company started way back
in 1910. ITC started its first cigarette factory at Bangalore in 1913. In 1975 ITC
entered into the hospitality sector by acquiring hotel Chola. In 1994 hotels
under the company were transferred into the listed subsidiary company
ITC Hotels Limited. 

In 1996 they launched brand Wills and also sponsored Cricket World Cup in 1996.
In 2000, ITC stepped into clothing, stationary products and gifting business.

So, a company which started with one product i.e. cigarette has today diversified
itself into more than five major segments.

Major Segments of ITC

Cigarette

According to statistics 42% of the Adult Indian males consume Tobacco.
Out of this only 10% of the males consume legal cigarettes.
This makes India the fourth largest market for illegal cigarettes.
This illegal consumption results in an estimated loss of 13000 crore to
the government exchequer every year. 

Digging further into some more interesting facts. 7% out of 42% of
the males consuming Tobacco prefer cigarettes 14% prefer beedi and
13% of the people use smokeless tobacco. Overall legal consumption of
cigarettes has gone down by 4% on a year on year basis whereas illegal
consumption of cigarettes has gone up by 5% on a year on year basis.

90% of the smokers in India are consuming smuggled cigarettes.
This smuggled cigarette results in a loss not only to a government
exchequer but also to the health of the people. The smuggled cigarettes
do not carry the statutory warning which is made compulsory by the
Indian government. Due to this reason many people carry an opinion
that smuggled cigarettes are safer, which is not true. Rather smuggled
cigarettes are much more harmful.

The following chart shows the legal consumption of cigarettes in various countries.

Whereas the reality is far away from this legal data stated above.
Hence, there is an urgent need to take stringent action against illegal
cigarettes entering Indian market.

Stationary                           

Stationary is another very important and popular segment of ITC.
Everyone must have used classmate notebook, expression notebook,
classmate pens. While classmates focus on children, PaperKraft brand
of ITC focuses on executives and the products under this brand name are
mainly markers and highlighters. Another main point which needs to be
pondered upon is the Demographic of India. 

Since, the major portion of the population of India is young and school going
thus, the demand of stationery is also high in the country. Initiatives of the
government such as Sarva Shiksha Abhiyan have also resulted in an increase in
the number of school going children.

Incense Sticks or Agarbatti and Match sticks

Mangaldeep and Aims are the two famous brands under this category.
ITC showcased innovation when it came out with an App named Mangaldeep.
In this application one can play devotional songs in various regional languages.
Following is the logo of the application.

Garment Segment (Wills Lifestyle)

This is the garment segment of ITC. The main motive behind introducing
this segment was that, since, in India direct advertisement of alcohol, cigarette
and tobacco products is not allowed thus, Surrogate advertising is practiced in
such a case. 

Surrogate advertisement is a form of advertising which is used to promote
banned products, like cigarettes and alcohol, in the disguise of another product.
Wills is basically a brand name for cigarettes of ITC, ITC aims at surrogate
advertisement of cigarettes by the way of Wills Lifestyle.

Food and Beverages (F&B)

In this segment ITC has various brands such as Yippie, Sunfeast, Aashirvaad Atta,
Bingo B Natural etc. There is a lot of competition in this segment. The following
chart gives you the brand wise yearly revenue for ITC under F&B segment.

 Conclusion

Apart from the above-mentioned segments there are many more segments of
ITC such as Agriculture Business of ITC. ITC is the number one producer of
Tobacco leaf in India. ITC has its online application named E- Choupal which acts
as a link between farmers and ITC thus, eliminating middlemen.
Another important segment of ITC is hospitality. 

ITC owns various hotels. As per statistics 10.5 million tourist visit India per year.
The number of tourists is far behind China which welcomes 60.4 million tourist
each year. Tourism and hospitality are the flourishing industry of the Indian
economy. ITC is all set to welcome and accommodate the future increase in the
number of tourists in the country. 

Government has undertaken several steps to provide a boost to the tourism
industry of the country. ITC also has its presence in printing and packing
segment as well. Thus, we can say that ITC has a diverse group with a number
of segment as well. Thus, we can say that ITC has a diverse group with a number
of segments.