ITC To Invest $2 Billion To Upgrade, Expand Capacities
ITC Ltd. will invest $2 billion (Rs 14,850 crore) "over the medium term" to upgrade existing capacities and set up new units across categories.
“We have to beef up capacity to meet demand and also invest to remain competitive for which technology has to be upgraded and the quality has to be upgraded,” Sanjiv Puri, chairman and managing director of hotels-to-cigarettes conglomerate, said at a press conference. And there are "new vectors of growth" like the Super App, paperboard, single-use plastic substitutes for sustainable packaging, he said.
Digital and sustainability are now witnessing higher traction, Puri said, reiterating his stance at the annual general meeting where he told shareholders that the company would explore opportunities on the basis of these two trends.
Consumers are looking for smart solutions for their homes and opting for trusted brands, he said.
ITC is considering ways to expand its consumer goods margins. Puri said the company will gain from scale benefit as capacity utilisation improves. The maker of Aashirwaad wheat flour has created integrated facilities, is working on new launches by adding value to existing products, and managing costs using digital inputs, he said.
The company has already taken its ready-to-eat products to more than 100 cities and plans to expand its presence in these markets, Puri said. “The short-term goal is to scale up in markets in which we are already present. These are categories where there is huge headroom to grow.”
ITC will be optimising revenues from existing properties, and also focus on growth through management contracts, Puri said. "Both together will help us grow faster."
The company already has 12 hotels under the Welcomehotel brand and plans to increase the count 20 by the end of the year and 34 in the next three to five years, according to Nakul Anand, director at ITC.
ITC also plans to start a chain of boutique lifestyle Storii-branded hotels, Anand said.