ITC Ltd is optimistic about the long-term growth and profitability of its fast-moving consumer goods (FMCG) business, despite current macroeconomic headwinds, Chairman and Managing Director Sanjiv Puri said on Friday.
Puri, replying to AGM, said ITC's FMCG business has achieved significant scale and efficiency, with its total addressable market pegged at around ₹5 lakh crore—among the highest in the industry.
"The creation of this business has been achieved in a very capital-efficient fashion, leveraging institutional strengths," he noted.
Despite a "softer demand environment" influenced by global inflation, climate-related food price pressures, weak external demand, and dumping of goods into India, Puri said, "rural demand is showing signs of improvement. The rural market is a bit better, and it's improving." To navigate current market challenges, ITC has implemented internal efficiency measures and adopted calibrated pricing strategies. It has also enhanced its product mix to drive better realisations, with the benefits of these actions expected to become visible in the coming quarters, he said.
While current results are impacted by the gestation costs of newer categories and investments in Integrated Consumer Manufacturing and Logistics (ICML) facilities, Puri reaffirmed ITC's commitment to its profitability roadmap.
"We remain committed to the guidance of 80 to 100 basis points increase in margins year-on-year. While this will not be linear, it is a trajectory we expect will sustain," he said.
Highlighting digital transformation, he said new-age channels—including ITC's own B2B app—now contribute about 31% of FMCG sales. "We are building portfolios for FMCG for today and tomorrow," he added.
