ITC scales FMCG play with 100 new launches, consumer spend touches Rs 34,000 crore

New Delhi: Multi-conglomerate ITC said consumer spending on the company's FMCG products has increased 4.6% to nearly Rs 34,000 crore in FY25, and the firm has expanded its play with 100 new products in the segment.

According to the latest annual report of the company, ITC, which has a presence in the branded packaged foods, cigarettes, personal care products, education & stationery products, agarbattis & matches, has a reach across over 26 crore households in India.

Besides, "digitally enabled sales have grown rapidly in recent years and, together with modern trade, now account for 31% of your company's FMCG portfolio," ITC said, addressing shareholders.

A year before, ITC had reported a growth of 12% in consumer spending on the company's FMCG products to nearly Rs 32,500 crore in FY24, with over 25 crore households having access to its various brands.

According to ITC, its FMCG business faced subdued demand conditions and a significant increase in competitive intensity from local/regional players.

"Costs of several major inputs such as edible oil, wheat, maida, potato and cocoa witnessed sharp escalation, especially in the second half of the financial year, weighing on margins," it said, adding it exerted pressure on bottomline through focused cost management interventions, judicious pricing actions and premiumisation.

ITC measures annual consumer spending as the sum total of what consumers spend on buying goods from the company. It is the net sales turnover of the brands, along with channel margins and taxes.

Its FMCG portfolio consists of over 25 Indian brands, which are largely built through an organic growth strategy leveraging institutional synergies in a relatively short period of time.

Some of them lead in their segments, such as Aashirvaad in Branded Atta, Bingo! in the segment of Snack Foods, Sunfeast in the Cream Biscuits segment, and Classmate in Notebooks.

ITC has logged a revenue of Rs 21,981.57 crore from FMCG businesses and is creating a future-ready portfolio including value-added adjacencies backed by smart omni-channel capability and excellence in supply chain to rapidly scale up businesses.

"Over 100 new products anchored on the vectors of Health & Nutrition, Hygiene, Protection & Care, Convenience & On-the-Go, Indulgence, etc., were launched across target markets during the year, leveraging the R&D platforms of your Company's Life Sciences and Technology Centre (LSTC) and agile product development teams across businesses," ITC told shareholders.

Now, ITC's growth strategy is to foray into value-added adjacencies and categories of the future by leveraging its 25 powerful mother brands it has established over the years.

In branded packaged foods, ITC said the industry witnessed severe headwinds during the year due to subdued consumer demand and unprecedented inflationary pressure.

However, it has "sustained its position as one of India's largest and fastest-growing branded packaged foods businesses, leveraging a robust portfolio of brands, a slew of first-to-market products, and regionally curated offerings, supported by an efficient supply chain and distribution network."

ITC, through its strong farm linkages, procurement efficiencies, brands and deep & wide multi-channel distribution network, with growing presence in new-gen channels such as e-commerce and modern trade, continues to deliver competitive advantage.

In the personal care space, ITC achieved "robust volume growth" led by rapid scale-up in new generation channels such as e-commerce, q-commerce and modern trade.

Besides the domestic market, ITC is expanding the export footprint of its FMCG businesses, with a reach now spanning over 70 countries.