ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India

Limited. As the Company's ownership progressively Indianised, the name of the Company was
changed from Imperial Tobacco Company of India Limited to India Tobacco Company Limited
in 1970 and then to I.T.C. Limited in 1974. In recognition of the Company's multi-business portfolio
encompassing a wide range of businesses - Cigarettes & Tobacco, Hotels, Information Technology,
Packaging, Paperboards & Specialty Papers, Agri-business, Foods, Lifestyle Retailing, Education &
Stationery and Personal Care - the full stops in the Company's name were removed effective
September 18, 2001. The Company now stands rechristened 'ITC Limited'.

The Company’s beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the
centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by
purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for
the sum of Rs 310,000. This decision of the Company was historic in more ways than one. It was to
mark the beginning of a long and eventful journey into India's future. The Company's headquarter
building, 'Virginia House', which came up on that plot of land two years later, would go on to become
one of Kolkata's most venerated landmarks.

Though the first six decades of the Company's existence were primarily devoted to the growth and
consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the
beginnings of a corporate transformation that would usher in momentous changes in the life of the
Company.

ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for
ITC's Cigarettes business. It is today India's most sophisticated packaging house.

In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennai which
was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of ITC's entry into the hotels
business was rooted in the concept of creating value for the nation. ITC chose the hotels business for
its potential to earn high levels of foreign exchange, create tourism infrastructure and generate large
scale direct and indirect employment. Since then ITC's Hotels business has grown to occupy a position
of leadership, with over 100 owned and managed properties spread across India.

In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards
Limited, which today has become the market leader in India. Bhadrachalam Paperboards
amalgamated with the Company effective March 13, 2002 and became a Division of the Company,
Bhadrachalam Paperboards Division. In November 2002, this division merged with the Company's
Tribeni Tissues Division to form the Paperboards & Specialty Papers Division. ITC's paperboards'
technology, productivity, quality and manufacturing processes are comparable to the best in the
world. It has also made an immense contribution to the development of Sarapaka, an economically
backward area in the state of Andhra Pradesh. It is directly involved in education, environmental
protection and community development. In 2004, ITC acquired the paperboard manufacturing facility
of BILT Industrial Packaging Co. Ltd (BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC
to improve customer service with reduced lead time and a wider product range.
In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. Since
inception, its shares have been held by ITC, British American Tobacco and various independent
shareholders in Nepal. In August 2002, Surya Tobacco became a subsidiary of ITC Limited and its
name was changed to Surya Nepal Private Limited (Surya Nepal).

In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major
supplier of tissue paper to the cigarette industry. The merged entity was named the Tribeni Tissues
Division (TTD). To harness strategic and operational synergies, TTD was merged with the
Bhadrachalam Paperboards Division to form the Paperboards & Specialty Papers Division in
November 2002.

Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for
export of agri-commodities. The Division is today one of India's largest exporters. ITC's unique and
now widely acknowledged e-Choupal initiative began in 2000 with soya farmers in Madhya Pradesh.
Now it extends to 10 states covering over 4 million farmers. ITC's first rural mall, christened 'Choupal
Saagar' was inaugurated in August 2004 at Sehore. On the rural retail front, 24 'Choupal Saagars' are
now operatonal in the 3 states of Madhya Pradesh, Maharashtra and Uttar Pradesh.

In 2000, ITC forayed into the Greeting, Gifting and Stationery products business with the launch of
Expressions range of greeting cards. A line of premium range of notebooks under brand “Paperkraft”
was launched in 2002. To augment its offering and to reach a wider student population, the popular
range of notebooks was launched under brand “Classmate” in 2003. “Classmate” over the years
has grown to become India’s largest notebook brand and has also increased its portfolio to occupy
a greater share of the school bag. Years 2007- 2009 saw the launch of Children Books, Slam Books,
Geometry Boxes, Pens and Pencils under the “Classmate” brand. In 2008, ITC repositioned the
business as the Education and Stationery Products Business and launched India's first environment
friendly premium business paper under the “Paperkraft” Brand. “Paperkraft” offers a diverse
portfolio in the premium executive stationery and office consumables segment. Paperkraft entered
new categories in the office consumable segment with the launch of Textliners, Permanent Ink
Markers and White Board Markers in 2009.

ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality
relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded
its range to include Wills Classic formal wear (2002) and Wills Clublife evening wear (2003).
ITC also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002.
In 2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills
Lifestyle India Fashion Week - that has gained recognition from buyers and retailers as the single
largest B-2-B platform for the Fashion Design industry. To mark the occasion, ITC launched a special
'Celebration Series', taking the event forward to consumers.

In 2000, ITC spun off its information technology business into a wholly owned subsidiary, ITC
Infotech India Limited, to more aggressively pursue emerging opportunities in this area. Today ITC
Infotech is one of India’s fastest growing global IT and IT-enabled services companies and has
established itself as a key player in offshore outsourcing, providing outsourced IT solutions and
services to leading global customers across key focus verticals - Manufacturing, BFSI (Banking,
Financial Services & Insurance), CPG&R (Consumer Packaged Goods & Retail), THT (Travel, Hospitality
and Transportation) and Media & Entertainment.

ITC's foray into the Foods business is an outstanding example of successfully blending multiple
internal competencies to create a new driver of business growth. It began in August 2001 with the
introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the
confectionery and staples segments with the launch of the brands mint-o and Candyman
confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the
Company entered the biscuits segment. ITC's entered the fast growing branded snacks category with
Bingo! in 2007. In eight years, the Foods business has grown to a significant size with over 200
differentiated products under six distinctive brands, with an enviable distribution reach, a rapidly
growing market share and a solid market standing.

In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain
found yet another expression in the Safety Matches initiative. ITC now markets popular safety
matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.

ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of
its partnership with the cottage sector. ITC's popular agarbattis brands include Spriha and
Mangaldeep across a range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur,
Sambrani and Nagchampa.

ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath & body care
products for men and women in July 2005. Inizio, the signature range under Essenza Di Wills
provides a comprehensive grooming regimen with distinct lines for men (Inizio Homme) and women
(Inizio Femme). Continuing with its tradition of bringing world class products to Indian consumers
the Company launched 'Fiama Di Wills', a premium range of Shampoos, Shower Gels and Soaps in
September, October and December 2007 respectively. The Company also launched the 'Superia'
range of Soaps and Shampoos in the mass-market segment at select markets in October 2007 and
Vivel De Wills & Vivel range of soaps in February and Vivel range of shampoos in June 2008.

ITC pioneered the cultivation and development of Leaf Tobaccos in India. Nearly a century of
creating customer delight ensures that globally, ITC's Leaf Tobacco business is synonymous with being
"The One Stop Shop for Quality Indian Tobaccos". The Leaf Tobacco business' partnership with the
farmer is also almost a 100 years old. In a spirit that truly embodies the Company's "commitment
beyond the market", ITC has helped the Indian farmer grow quality leaf tobaccos and linked him to
global markets.

ITC is the largest buyer, processor and exporter of leaf tobaccos in India - creating a global
benchmark as the single largest integrated source of quality tobaccos. Serving customers in
50 countries across more than 70 destinations, ITC co-creates and delivers value at every
stage of the leaf tobacco value chain.

ITC buys nearly 50 per cent of all cigarette tobacco types grown in India. It has a team of
experienced, highly skilled and professional buyers and classifiers who source and segregate tobaccos
to exacting customer specifications. A large inventory base of quality tobaccos provides an edge in
serving customers through product customization, portfolio rationalization, product bundling and value
added services. This strategic direction insulates customers from crop fluctuations, a key 'winning
proposition' acknowledged worldwide.

ITC's comprehensive and sophisticated R&D facilities cover all aspects of cultivation,
product development and processing through fundamental and applied research. Thus, ITC's
value proposition to its customers is "On Time In Full" delivery of quality tobaccos spanning across all
tobacco types at competitive prices.

ITC's Green Leaf Processing plants at Chirala and Anaparti in Andhra Pradesh, the tobacco hub of
India, are benchmarked with the best in the world. State-of-the-art technology, shared product
knowledge base, sophisticated process and quality controls enable ITC to process and
deliver 120 million Kgs of high quality tobaccos annually. These factories have integrated
warehousing complexes that match international standards in hygiene, infestation control and
monitoring.

ITC's quality emanates from its intimate involvement with the tobacco farmers in India. Effective
reach mechanisms help transfer 'best practices' from the lab to the land. With an extensive presence
in rural India, ITC's Leaf Tobacco business maps critical Soil, Crop and Process control parameters
across cultivated areas. Intermediation through a dedicated pool of trained managers in critical areas
like soil testing, varietal improvements, vermicomposting, nutrient management and post harvest
management results in a superior agri output. These initiatives position ITC as an integral part of
India's agricultural landscape. ITC's collaboration with related Government agencies has
helped develop new varieties of tobaccos and explore new areas for tobacco cultivation

Catering to industries as diverse as Food & Beverages, Consumer Electronics, Pharmaceuticals, Steel,

Cement and Oil & Gas, ITC distributes products and provides access to even the most remote parts of

the country. With a range of services to choose from, customers can decide how their products get

delivered and how soon they arrive.

Our focus is on providing integrated distribution solutions. ITC's vast transport infrastructure, IT systems,

cutting - edge technology solutions and an intensive knowledge of Pakistan allows it to tailor its

distribution solutions to meet every customers' unique needs. ITC offers a wide range of options and does

not waver in its focus on quality, reliability and speed.

is the ideal partner for clients looking to distribute goods from multiple locations and those with changing

distribution needs. For an SME or an MNC entering the Pakistani market, ITC Logistics is the right choice.

The unique features of ITC's distribution solutions are:

 "Ready Made" distribution channel

 Standardisation at all locations

 Inventory location close to your customer

 Entry into new markets without a large capital investment

 Shelf Space at our Warehouse locations

The ace up the sleeve of ITC's newest foods venture is its extensive distribution reach  

Taking stock of the FMCG block is tobacco and hotels giant ITC Ltd. A few years ago it climbed onto the
retail bandwagon, leveraging existing strengths to diversify into areas from greetings and gifts to lifestyle
retail. While it's got a long way to go to challenge Hindustan Lever, ITC is banking on the two mainstays
of consumer goods that it does possess - a strong brand equity and a wide distribution network.

The game plan is all about strategic synergy. A year ago the company's newest division, Bangalore-
based ITC Foods, moved into the branded packaged foods market and is leveraging the parent
company's agricultural products division for sourcing, as well as ITC Welcomgroup's specialist cuisine
knowledge and its packaging division.

The ace up ITC's sleeve, however, is the company's established distribution network that includes the e-
choupal system - a two-way sourcing and distribution system for farmers in remote villages, as well as its
cigarette and paan network.

With this infrastructure in place ITC Foods has launched into four branded foods areas - ready-to-eat,
staples, snacks and confectionery. Its Kitchens of India brand sells packaged gourmet Indian cuisine,
which offers recipes from ITC Welcomgroup Hotels. "We picked up popular recipes and put them into
cans", says CEO Ravi Naware. "This is five-star food prepared by our chefs and targeted at connoisseurs
of good food". The brand is marketed through upmarket retail chains in Delhi, Mumbai, Bangalore,
Chennai, and Ahmedabad, and select clubs in Kolkata.

The selling point is that no preservatives are added, and through 'retorting' technology the shelf life of
these foods is close to one year. ITC Foods has a contract manufacturing facility, where quality is
supervised with focus on ingredients and recipe. A panel tastes it and approves it before processing takes
place. The canned Kitchens are present in 48 towns (of over 500,000 population) and the group plans to
export its products after is has established the brand nationally.

The group sees high growth potential in the staples segment. "The consumption of aata is 45 million
tonnes in India", says Naware. "Only 2 per cent of this is branded". ITC's branded aata is customised to
cater to different tastes, to suit markets in the north, west, and south. To differentiate each type, the
package is colour-coded - the main variant in each area is coded red, while its Ashirwad Select is coded
orange. Essentially an urban phenomenon, it covers 27 cities in India. The company plans to have its
staples available all over India by March this year - and next on the agenda is branded rice and salt.
"There's a need to consolidate, to establish the business and the brand, and then fill up the portfolio",
says Naware. Gopal G.V.R., a supervisor at Foodworld in Bangalore, notes: "You just can't compete with
Lever's Annapurna or Godrej's Pillsbury". However, he does point out that the awareness and demand is
picking up for ITC's aata. Kitchens of India, on the other hand, is doing well with an elite segment of
consumers, while the orange Minto confection is taking off.

Minto helped to generate quick volumes in four months, says Naware. Acquired from Candico in March
2002, Minto was reengineered and the flavour variant - orange - introduced. "We got into the untapped
potential of the mint market", says Naware. "We brought novelty to this segment - orange mint is 50 per
cent of consumption". ITC Foods' product development centre in Bangalore is working at bringing added-
value products across segments. The bid to be different "to create a buzz in the market", says Naware,
also led to the wild banana variant in the Candyman range of sweets. The flavour was one of the two (the
other being mango) chosen after a sampling of six flavours by 3,600 schoolchildren. Here the distribution
makes use of the tobacco network: ITC services 1.1 million outlets at average frequency of three days
down to villages of population 2,000, and has 1,000 wholesale dealers.

"ITC's distribution philosophy is that of channel-tailored support. ITC and its distributors use different
sales forces to cater to the separate channels of convenience outlets, grocers, and supermarkets", says
Naware. "ITC services trade channels and not specifically one kind of outlet alone. Thus for impulse
purchases like confectionery, the bulk of our sales come from convenience outlets. However, categories
like aata, ready-to-eat foods, and snack foods are directly distributed to grocers and key accounts, in
addition to some convenience outlets".

ITC directly services more than a million outlets all over India. It has depots in key states and the depots
are geographically dispersed to optimise logistics costs, according to Naware. He points out that for high-
bulk, low-weight items (such as the most recent launch of snack brand I Bischips), specific retail stocking
and display solutions use floor and air space for ease of placement and high visibility.

The other advantage is ITC's backward integration with the parent company's $155 million international
business division (IBD), which markets agricultural products abroad. IBD's e-choupal system, which
sources directly from the farmers through 1,286 kiosks across 9,000 villages, also helps to develop
markets and brands for ITC's consumer goods. As a distribution channel, the two-way-functioning e-
choupal is cost effective, with the added scope of increasing in range as more kiosks and more farmers
are tagged on to the sourcing network. The e-choupals and the storage hubs - the company has a
strategically located hub in each state - function as centres where ITC and the firms it partners can
market FMCG goods that range from agricultural products to household items.
The company also uses local paanwalla networks to help to boost its brands. Cash-rich and networked,
the company is cashing in on the potential of a 2.5 million-strong force of such retailers. The group's
experience in cigarettes has sensitised the system to fine-tune stock control mainly because cigarettes
are a high-value product with high inventory carrying costs. At an individual retail outlet level the company
has a supervision process that ensures stockouts/overstocking do not take place.

ITC's frequency of retail servicing is one of the highest in the consumer-goods business. Consequently it
does not need to resort to dumping of stocks at an outlet as an insurance against stockout situations but
can sell only as much as the retailer can dispose of and top up stocks whenever and wherever necessary.
This also makes the group manage its working capital better.

Timing and data-gathering regarding stocks is crucial. "We have a fully online ERP-based logistics
system linking our distributors, godowns, and marketing branches to head office and factories,
continuously feeding in data of sales and stock positions across the entire supply chain", says Naware.
"This enables us to track pipelines and sales in real time and keep control over all elements of the supply
chain, be it raw material, packaging material, work-in-process inventory, or finished goods."

To leverage its network and distribution reach, and to centralise the data flow between various divisions,
ITC has installed Project Infobahn, a companywide hybrid network using a virtual private network (VPN)
through an Internet service provider. This comprises 69 leased lines, 103 ISDN lines, 10 radio frequency
devices, and four new VSAT links. This lets staff, wholesale dealers, and partner companies access data
and transact business over the Internet. It also leverages the existing network to 'cross-sell' and 'up-sell'
the company's own business offering and enables it to market offers from other business houses through
a secured distribution network. The network spans 110 locations and all ITC divisions.

ITC complements its distribution effort with consumer research. According to Naware, it spends Rs12
crore on consumer research. He says that a study showed that 48 per cent of annual household
expenditure goes on buying food. Branded food comprises 5 per cent of this and the percentage will
increase as the economy improves. Naware believes expenditure on food will touch Rs100 crore in five
years' time.

Meanwhile, how is ITC gearing up to take on Hindustan Lever, Nestle, and others in the foods business?
Says Naware : "Competitive advantage will come from distribution strength, servicing of outlets, product
quality, relevance, and differentiation. These constitute the mainstay of our business strategy. We hope to
leverage our brand development capabilities and establish ourselves in the market place." Naware also
points to ITC's abilities in "building consumer brands, in distribution, in unmatched servicing of retail in
India to even villages of 2,000 population as well as its ability to deal with agricultural products".