ITC, the Rs 11,000 crore tobacco major, is considering
backward integration for its apparel brand Wills. The company is planning to source cotton
for its ready made garments through the e-choupal initiative.
"We have plans to source cotton through our e-choupal
initiative to for our apparel business" S Sivakumar, chief executive officer, ITC
international business division (IBD), told Business Standard on the sidelines of a
recently held Globoil conference.
However, the company is likely to embark on cotton sourcing
initiative next year. IBD is country’s second largest exporter of agri-products with
exports of over Rs 500 crore. Of this, the share of e-choupal business is about Rs 300
crore which is expected to double in the current financial year to Rs 500-600 crore,
The division currently focuses on exports of soya meal,
rice, aqua products, peanuts, coffee, wheat, sesame seeds, black pepper, processed and
frozen fruits and vegetables.
ITC has initiated e-choupal coverage in Maharashtra and
under its three year plan, 500 e-choupals were being set up in the Vidarbha region in the
first phase, Sivakumar said adding that it would be expanded to Sangli followed by Nasik,
next year. They will focus on soyabean, horticulture and cotton.
"It is a three year plan and we will be sourcing
soyabeans to crush 70,000 tonnes of beans a year at a hired crushing plant in
Nagpur," Sivakumar informed.
The soyabean oil from this plant will be sold under
e-choupal brand in the rural market in line with what the company is already doing in
The company is planning to extend its e-choupal initiative
to Uttar Pradesh and Rajasthan next year.
ITC has already set up 2500 e-choupals in 14000 villages
spanning five states till date. "We are setting up six choupals everyday,"
ITC’s unique strength in this business is the
extensive backward linkages it has established with the farmers. This networking with the
farming community has enabled ITC to build a highly cost effective procurement system. ITC
has made significant investments in web-enabling the Indian farmer. Christened
‘e-Choupal’, ITC’s web plan for the farmer centres around providing
internet kiosks in villages.