Calcutta: ITC Ltd. plans to spend 20,000 crore in the next five years to ramp up capacities in fast-moving consumer goods and paper businesses, among others, the company’s chairman and managing director, Sanjiv Puri, informed the shareholders on Friday. Speaking at the 113th annual general meeting of the company, Puri said ITC’s ‘confidence in the India story is unwavering, and it is reflected in the company’s investment outlay in the medium term.
Puri’s announcement comes close on the heels of Union Finance Minister Nirmala Sitharaman exhorting the private sector to step up capex, saying India offered the brightest opportunity. ITC’s investment program also follows a stable taxation regime undertaken by the finance ministry lately. The budget presented earlier this week did not hike taxes on cigarettes, the biggest penny-spinner for the company.
A stable regime allows regulated entities such as ITC to claw back shares from non-tax-paying illicit trade while boosting the exchequer. Elaborating further on the investment program, Puri said about 35–40 percent of the outlay would be spent in the FMCG business and about 30-35 percent in paperboard and packaging. The rest is being earmarked for agriculture and other businesses.
In FMCG, ITC intends to augment the capacity of the existing units and build a few new ones. Investments will go into adding machinery, upgrading product quality, bringing in variety and more innovation, and building new sites. The company has 11 integrated consumer goods manufacturing and logistics facilities.
Consumer spending on ITC’s demerger and the growth of the FMCG portfolio now stand as plans for the business. Puri at 32,500 crore.
“The drivers informed us that the process of structural competitiveness would be complete in the next six months unleashed by the ITC. Next month and ITC would pursue strategy reinforce our aspiration to be No.1 in this industry,” Puri told the shareholders