ITC eyes Rs 23,000 crore investment over next decade

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ITC, the FMCG major, is quite bullish on the investment front as the company has outlined major investment plans across its diversified business portfolio.

The company is looking at the option to make an investment of Rs 8,000 crore over the next 7-10 years in order to boost the growth in this sector. This move by the company is aimed at keeping pace with the exponential growth in the sector.

Moreover, the company is planning to make an investment of Rs 6,000 crore in the paper, paperboards and packaging business.

Addressing shareholders at the companys annual general meeting, chairman Y C Deveshwar said that the FMCG sector in India is expected to grow to almost triple in size to more than Rs 3,55,000 crore by 2018.

Deveshwar also said ?At conservative estimates, India needs 50,000 rooms in the next 2 to 3 years. This sector too carries an investment opportunity for ITC of upto Rs 9,000 crore in the next 7 to 10 years to fuel its growth?.

The company, whose new properties were already under construction in Chennai as well as Kolkata, plans afoot in several other locations.

Regarding the financial performance, ITC has registered a surge in Profit After Tax (PAT) by 21.8 % at Rs. 1,070.31 crore during the Q-1 of the current financial year (2010-11). During the same quarter of previous financial year, the company had recorded Rs. 878.70 crore as compared to this quarter.

The net turnover jumped by 16 % to Rs. 4,817 crore.

The company had recorded a surge mainly due to the improvement in its cigarettes, foods, personal care and agri businesses.

Its Profit Before Tax increased by 19.2 % to Rs. 1,570 crore and Earnings Per Share (EPS) stood at Rs. 2.80.

The company said that its non-cigarette Fast Moving Consumer Goods (FMCG) businesses showed improved profitability. Operating profits from the non-cigarette businesses grew 38 %.

Source: Dalal Street Investment Journal
Dalal Street Investment Journal