SWOT ANALYSIS

ROMIR DAS
JYTORIMOY CHOWDHURY
ROUNAK PAUL
SOHAM BASU
 HISTORY OF ITC
• Established in 1910, ITC Limited is a diversified conglomerate with
businesses spanning Fast Moving Consumer Goods comprising Foods,
Personal Care, Cigarettes and Cigars, Branded Apparel, Education &
Stationery Products, Incense Sticks and Safety Matches; Hotels,
Paperboards and Packaging, Agri Business and Information Technology.
The Company 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 to India
Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In
recognition of the ITC's multi-business portfolio encompassing a wide range
of businesses, the full stops in the Company's name were removed effective
September 18, 2001. The Company now stands rechristened 'ITC Limited,'
where 'ITC' is today no longer an acronym or an initialised form.
 INTRODUCTIO
N
• SWOT analysis (or SWOT matrix) is a strategic planning and strategic management
 technique used to help a person or organization identify Strengths, Weaknesses,
Opportunities, and Threats related to business competition or project planning. It is
sometimes called situational assessment or situational analysis.
• Strengths: characteristics of the business or project that give it an advantage over others
• Weaknesses: characteristics that place the business or project at a disadvantage relative to
others
• Opportunities: elements in the environment that the business or project could exploit to
its advantage
• Threats: elements in the environment that could cause trouble for the business or project
 COMPANY OVERVIEW
• ITC Limited is an Indian conglomerate company headquartered in Kolkata.
ITC has a diversified presence across industries such as FMCG, hotels, 
software, packaging, paperboards, specialty papers and agribusiness. The
company has 13 businesses in 5 segments. It exports its products in 90
countries. Its products are available in 6 million retail outlets.
• Established in 1910 as the Imperial Tobacco Company of India Limited, the
company was renamed as the India Tobacco Company Limited in 1970 and
later to I.T.C. Limited in 1974. The company now stands renamed to ITC
Limited, where "ITC" today is no longer an acronym. As of 2019–20, ITC
had an annual turnover of US$10.74 billion and a market capitalisation of
US$35 billion. It employs 36,500 people at more than 60 locations across
India.
 STRENGTHS
• STRENGTHS: ITC LIMITED SWOT ANALYSIS
• Brand Image- ITC is a listed company that ranks among the 30 most valuable global brands. It is among the top 10
companies in India in terms of market capitalization and is among the top 8 out of 2,646 companies in the BSE 500
Index. ITC is the world’s second-largest cigarette company with an estimated market share of 8.8%.
• Global perspective and deep expertise in food retailing– ITC has built its brands from the ground up and worked hand in
hand with its franchisees to ensure success. ITC operates two publicly traded companies in India – Aashirvaad
Investment and Retail Solutions Ltd and Yippee! Brands Ltd – that have significant stakes in over 70 retail brands across
categories (including FMCG ).
• Social Initiatives- ITC has set up village internet kiosks – e-Choupals – which made real-time, up-to-date, relevant
information on weather, price discovery, Agri know-how, and best practices, etc readily available. Through the kiosk,
local farmers can instantly access agriculture-related information in their local language. Other initiatives by ITC are-
Choupal Pradarshan Khet (CPK), Sab Saath Badhein, and Baareh Mahine Hariyali, etc.
• Leading in other sectors- ITC Hotels is a cutting-edge collection of luxury hotels in India’s prime business and tourism
destinations. With the first property opening its doors in 1975, ITC Hotels today is a pioneer in creating a new
benchmark for the hospitality industry with its unique concept, Responsible Luxury. Also with decades of experience in
personal care, home care, catering and other segments across high-growth sectors, ITC’s latest brand – ITC MasterChef
– is focused on providing consumers with the most useful information they need to make a purchasing decision.
 WEAKNESSE
S
• WEAKNESSES: ITC SWOT ANALYSIS
• Inefficient Cost Management System- ITC has been focusing on diversification in their core
FMCG businesses but has failed and cannot garner the expected success rate. Being the only
conglomerate in the FMCG industry, the company has gotten severely affected due to the
reduction in expenditures brought by the recession. 
• Highly dependent on Tobacco- ITC’s revenue comes from two businesses – tobacco and
FMCG. Tobacco contributes to 86% of total revenue and FMCG contributes 14%.
• Incremental tax burden on the Cigarette Business – The newly enforced Goods and Services
Tax Act, 2017 has increased the overall tax rate, making a huge difference in the cigarette
business of ITC. If we take into consideration the tax slab before GST and compare it to the
rates levied after GST, we notice that there is a significant increase happening in the cigarette
business of ITC. For example, before GST 20 cigarettes were taxed at Rs.10 however, now 40
cigarettes are taxed at Rs.20 making cigarettes way more expensive.
 OPPORTUNITY

OPPORTUNITIES: ITC SWOT ANALYSIS

•Harnessing India’s Growth- Indian economy will grow by about 8-9 % in the next 10 years which helps ITC
to create more and more opportunities for itself in the food and beverages business. As the GDP increases, so
is the purchasing power of customers which means that they will be able to buy branded products instead of
unbranded products for better quality. Also due to an increase in purchasing power of the middle class, they
are now willing to eat out or dine out and hence hotels and restaurants will see an increase in their sales
resulting in new opportunities for ITC.
•Core Brand Extension- The company is going to scale up the distribution channels and optimize volumes by
using its Aashirvaad brand as a halo effect. Currently, there is substantial thrust on brands such as
Aashirvaad, Sun Feast, and Mint-o. This would be a growth driver for ITC in the near term.
•Online Community for Farmers- The e-Choupal initiative offers new opportunities for small farmers, by
improving the quality of production information flow, creating new channels of communication between
producers and buyers, and providing a forum for the resolution of issues related to farming online. This
initiative will serve as one of many vital tools to sustainably increase agricultural productivity, are beneficial
in addressing farmer suicides and other chronic issues plaguing this sub-sector within India .
 THREAT
•THREATS: ITC SWOT ANALYSIS
•Competition from Other Sectors- The threat of ITC lies in other companies able to
produce similar products for a lower cost. Customers will choose the outsourcing
company with the lowest cost product since it is less expensive for them. ITC’s
competitive advantage will be lowered as outsourcing companies lower their prices.
•Governments are tightening laws on Tobacco Industry- A ban on print advertising of
cigarettes will restrain ITC from its potential to reach out to consumers and promote its
products. Further, several other crucial fiscal policies such as an increase in Excise Duty
and increased taxes under GST are some of the obstacles that threaten this business.
•Uncertain profit margin- Massive uncertainties are surrounding ITC’s capital allocation
policy. The company has been investing in businesses that don’t exactly fit the profile of
an ITC stockholder. ITC Limited’s stock has slumped over the past three years as it has
had to contend with declining consumption in its flagship cigarette business, very bad
acquisition decisions, pressure on margins due to labour cost hikes, and a hostile bid
environment.
 PRIME
COMPETITORS
• The Indian market is currently emerging as a highly competitive sector with multiple players offering different
incentives and products for consumers. The current cost competitiveness presents a tough challenge for any
player to gain a competitive advantage in this crowded market. Here’s are a few major competitors of ITC
Limited-
• Dabur – Dabur India Limited is India’s fourth-largest FMCG company in terms of sales. Its product range spans
across the categories of Food, Beverages, Personal Care, and Pharmaceuticals. There are five business verticals
namely Personal Care, Health care, Pharma, Food and beverages. The business reported a consolidated
turnover of Rs. 13,415 crores for the financial year ended March 31, 2014, with a net profit of Rs. 2,190 crores.
• Nestle – With the largest share of the major commodity categories, India is Nestle’s second-largest market with
sales of over Rs. 13,000 Crore (USD 2.1 Billion) in FY 2012-13. It is one of Nestle’s top-performing markets in
the Asia Pacific with +15% growth. Nestle India has a strong pipeline for growth.
• Hindustan Unilever – HUL has its presence in 22 countries with over 4,000 products across 10 categories. Over
the years, HUL has built strong brands like ‘SUN’, ‘Lifebuoy’, ‘Rexona’, ‘Dove’ and ‘Fair & Lovely’ among
many others and has shown consistent growth. The company reported a sales turnover of Rs.43,497 Crore for
FY14 (ending March 31, 2014), with a net profit of Rs.4,386 Crore.
 BRANDS AND PRODUCTS OF ITC
• Products List of ITC
• So here is the ITC products list. ITC Limited launched
over 50 new FMCG products, across categories such as :
• Foods,
• Personal Care,
• Education, and
• Stationery products,
• Agarbatti and Matches,
• Strengthening its diverse and differentiated portfolio of
FMCG offerings.
 CONCLUSION
• ITC has touched the lives of consumers across India, whether it is in the food and
beverages space through over 275+ strong brands or in various social initiatives
helping improve the quality of life.
 ITC’s well-known household brands have been developed in markets with high
growth potential. There are problems, let alone to conquer these markets but also to
establish a foothold. On the one hand, it is questionable whether ITC will be able to
keep up with the rapid growth of its competitors in these markets using its
conventional marketing strategies because they have already established strong
positions in such markets. 
I think I can be fairly positive about the future of ITC Limited. My main concerns
are: What strategic direction will it adopt? Can it maintain its image as a multi-
product company, or must it become a focused player in selected product markets?
If it becomes viewed as a one-product specialist, will that decrease the value of its
brand name?