ITC has carefully reduced the presence of the cigarette business in the public eye, talking much more about its fresh ventures and achievements as a corporate citizen.
A clever re-branding has taken the Wills brand's association much beyond cigarettes, so that the equity built over the decades because of ITC's dominance of the cigarette market is reaped by other products like apparel.
Harish Bijoor, the head of Harish Bijoor Consults, notes, "ITC now has a broader image. While it may seem to be insulating its businesses from the socially-ostracised segment of cigarettes, ITC may just have to live with this canker."
While cigarettes generated Rs 961.41 crore (Rs 9.61 billion) in profits in the first quarter of this financial year, the non-tobacco FMCG products eroded Rs 122.61 crore (Rs 1.23 billion).
The hotels, agri-business, and paperboards and packaging have registered year-on-year growth rates ranging from 33 to 43 per cent.
The new business of readymade clothing retail, too, is making dents in ITC's profit.
Image: A cigarette vendor in New Delhi | Photograph: Raveendran/AFP/Getty Images
Also read: Lalu Yadav, the management guru!
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