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Rohit Roy - 14020241096ITC : M&AITC : Past & Present24 Aug1910 ITC incorporated under the name of 'Imperial Tobacco Company of India Limited'.1925 ITCs Packaging & Printing Business Division was set up as a strategic backward integration for ITCs Cigarettes business.1974 The Company's ownership progressively Indianised, and the name of the Company was changed to ITC Limited (Indian tobacco company).1975 The Co. launched its HOTEL BUSINESS which was named ITC-Welcome group Hotel Chola.1979 ITC entered the Paperboards Business by promoting. Bhadrachalam Paperboards Limited, which today has become the market leader in India.2002 Enter into fmcg sector.

Business Profile

ITC BUSINESS PORTFOLIOFMCG &CIGRATESHOTELS & ITAGRI BUSINESSPAPERBORD &PACKAGINGProduct Profile

Personal Care ProductsCurrent market size estimated at over Rs. 29000 cores (growing at 12% p.a.) ITC presence established in Body Wash (Soaps, shower gels), Hair Care (Shampoos, conditioner).Product portfolio enlarged with the launch of Fairness cream.Portfolio approach straddling all consumer segments with 4 umbrella brandsEssenza Di Wills (Prestige)Fiama Di Wills (Premium) Vivel Di Wills and Vivel (Mid)Superia (Popular) Products well received in the market, gaining customer acceptance

M&A in Personal CareITC has been pushing its non-cigarettes business portfolio.ITC Ltd has signed an agreement with consumer healthcare firm Johnson & Johnson to buy trademarks for its wound care product Savlon and talcum powder Shower To Shower for India.The acquisition strengthens its consumer products business in the country.Although cigarettes still bring bulk of ITC's profits, the firm has been slowly pushing its non-cigarettes business portfolio.The two deals signals ITC's change in strategy by acquiring a larger pie in the Indian non-tobacco FMCG space.M&A in Personal CareTill date, all of ITC's brands in the non-cigarette space have been developed organically in-house from John Player apparels to Classmate stationary to Bingo! snacks to Vivel soaps. This is in line with ITC's aspiration to achieve a revenue of Rs 100,000 crore from the new FMCG businesses by 2030.This is the second acquisition by ITC in 10 months after the Rs 100-crore B Natural juice buy last May. That acquisition gave ITC access to the growing natural juice market, dominated by players such as Dabur (with Real) and PepsiCo (with Tropicana).

The Way ForwardThe latest acquisition, notably of antiseptic liquid Savlon, will help the Kolkata-based major ramp up its play in health care - a market that will only grow.The organised hygiene market, according to industry estimates, is pegged at Rs 3,000-4,000 crores. This market, analysts say, has the potential to double, provided branded products are used even more in both urban and rural households. At the moment, it is not the case, with many households counting on plain water for cleanliness.Savlon's arch-rival RB's Dettol has taken the lead by moving beyond antiseptic liquids into soaps, hand wash, hand sanitizers and allied personal care products on the '100-per-cent germ protection' platform. RB has spent regularly on Dettol, unlike J&J, Savlon's erstwhile parent.The Way ForwardThe same goes for Shower to Shower. While it is restricted to talcum powder (both regular and prickly heat), it could be extended to areas such as anti-dandruff shampoos by ITC.Savlon's FY-14 sales were estimated to be Rs 65 crores, while Shower to Shower's FY-14 sales were roughly Rs 25 crores. Together these brands will add around Rs 90-100 crores to the top line of ITC's personal care portfolio, pegged at around Rs 900 crores.ITC has been successful in carving out a space in a market that only knew (Nestle's) Maggi in past.ITC's ability to out-spend rivals and its strong distribution network could help it expand the two brands. ITC, with its deep pockets, will always have the comfort of dictating prices.ConclusionWhile ITC has been stuck with 2-3 per cent market share in shampoos, in soaps, it is estimated to have a share of 4 per cent. In newer segments such as deodorants, ITC is estimated to have notched up a share of about 9-10 per cent with Engage, beating some older rivals.Besides Engage, ITC's Vivel, launched in 2008, is said to be its strongest personal care brand, according to analysts. With trademarks such as Savlon and Shower to Shower, analysts say, ITC has added more depth to its portfolio.ITC has very deep distribution and good financial to take up such brands and start promoting on and scaling them up. So, it reduces its time to market significantly.

Referenceshttp://www.vccircle.com/news/fmcg/2015/02/13/itc-acquire-savlon-shower-shower-trademarks-india-johnson-johnsonhttp://www.dnaindia.com/money/report-itc-buys-johnson-johnson-s-savlon-shower-to-shower-brands-2060821http://www.moneycontrol.com/news/stocks-views/itcs-latest-acquisition-goodlong-term-p-lilladher_1302068.htmlhttp://www.business-standard.com/article/markets/itc-extends-gain-on-acquisition-of-johnson-johnson-brands-115021600403_1.htmlhttp://www.business-standard.com/article/management/itc-s-newly-acquired-brands-to-have-multiplier-effect-115021801368_1.html