ITC Ltd will invest $2-billion (around Rs 15,000 crore) in the mid-term to expand capacity in FMCG, paper, packaging, agri-business and update technology, chairman and managing director Sanjiv Puri said.
Addressing a virtual press conference on Thursday, Puri said the company is setting up new plants such as for spices which will cater to both exports and domestic markets, packaging plant in Gujarat since there are huge demand in that region from clients, a nicotine derivative plant and also adding new lines and upgrade existing ones. He declined to specify the investment horizon in years.
“The investment will also be to meet demand, make the organization more digitally enabled and invest behind new vectors of growth in FMCG, sustainable packaging and others. We are not factoring the investment for any acquisitions in this since it is difficult to size that up,” said Puri.
ITC is scouting for acquisitions across businesses and proactively in the FMCG business. In FMCG, Puri said it could be in categories of future such as smart home solutions, health, wellness, hygienece, convenience food and indulgence. “We will only go for acquisitions which are value accretive,” he said.
In the hotels business, ITC is betting on an ‘asset-right’ strategy which involves more focus on managing properties rather than investing behind newer ones.
ITC’s director Nakul Anand said the company currently manages 12 Welcom Hotels but will end the year with around 20 properties with 5-6 already signed and negotiations on for another 5-6 properties.
“In the next 3-4 years, ITC will have 34-35 Welcom hotels. Similarly, we expect to add 4-5 properties under our newly launched boutique hotel brand Storii which will come up primarily in nature based locations,” said Anand.
Puri said this asset right strategy for the hotel business will enable the company to have an alternate structure which will be decided when the hospitality industry improves.
https://m.economictimes.com/industry/cons-products/fmcg/itc-to-invest-2-bn-to-expand-capacity-in-fmcg-paper-packaging-agri-biz/amp_articleshow/85266786.cms
