1. BCG Matrix for ITC Ltd.Ranjan Varma http://financexchange.blogspot.com

2. StructureLearning points and conclusions Action! Act III The BCG matrix Camera! Act II ITC- A Background Lights! Act I 3. Act I[Lights!]

Governance structure

Strategic supervision

Strategic management

Executive management

Core values

Nation Orientation; Trusteeship; Excellence;

Customer focus; respect for people; Innovation

4. 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.

5. Business Mix of ITC Ltd.

FMCGCigarettesFoodsLifestyle RetailingGreeting, Gifting &StationerySafety MatchesAgarbattis Paperboards & PackagingPaperboards &Specialty PapersPackaging

6. Business Mix (Contd)

Agri - Business Agri-Exports e-Choupal Leaf Tobacco

Hotels

Group Companies ITC Infotech; etc.

7. Business wise Sales data Net revenue Paper & pkg. Agribusiness Hotels FMCG-Others FMCG-Cigarettes Business/ Year 12.99 24.9 4.2124.185.28.4 Growth % 11815.04 13349.58 1253.29 1565.31 1708.77 1780.07 257.53 577.25 304.16 563.39 Value (Rs in Crore) 9230.27 10002.54 2004 2005 8. CAGR during FY 2005-2008 Fast track, decent share. 60.2 % FMCG-Others E-choupal, choupal sagar, 34.3 % Agri business Capacity utilization, value added products 17.2 % Paper Inward traffic, occupancy 22.7% Hotels Pricing power 10.9 % Cigarettes Growth parameters CAGR Category 9. 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.

10. -7.5% 4.4% 20% share of greeting cards market, 'Aashirvaad' atta is No.1 in branded segment FMCG (Others) 5.4% 4.3% ITC Group ranks No.2Hotels 3.7% 7.0% 1of the largest xporters from India Agribusiness 10.7% 7.3% Packaging board No. 1 in Asia Paper &Packg. 87.7% 77.0% 70% share Cigarettes Contribution % RevenuePBIT Dominance Segment 11. Market attractiveness & Competitive strength is also important. Act 2 12. 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.

13. The BCG Matrix for ITC Ltd. Dogs

Cows

FMCG-Cigarettes

?

FMCG- Others

Stars

Hotels

Paperboards/Packaging.

Agri business.

14. Act III - Action-Learning points and conclusions

? -To be handled with care.

Strategic forays into emerginghigh growth markets.

E-Choupal is a transformational strategy.

Strong brand building capability will be tested.

15. Learning points (Contd)

Corporate strategy of creating multiple drivers of growth anchored on itscore 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.