ITC Ltd has reported a phenomenal growth in its fledgling food brands Aashirvaad and Sunfeast, with Aashirvaad atta volumes growing 10 times in three years and Sunfeast biscuit volumes 18 times in two years.
According to the company’s latest annual report for 2005-06, Aashirvaad atta now commands 45% of the market, having been launched in May 2002. In biscuits, an even more recent foray, ITC has captured a market share of 8%. In confectionery, ITC has built up a 17% share of mint candies and 24% of hard-boiled candies. Its two brands Mint-o and Candyman, along with their variants, grew almost 70% over last year.
Its ready-to-eat Sunfeast Pasta Treat has clocked 6% of the branded noodles volume in just one year. Overall, ITC’s foods business, which comprises ready-to-eats, staples, biscuits and confectionery, grew an impressive 87% over last year.
An HSBC report, referring to ITC’s Sunfeast, said, “ITC has been able to create a brand with annual revenues of Rs 7 billion” (Rs 700 crore). “This is 40% of the size of the country’s leading biscuit brand Britannia, and is one of the biggest brand creations that has happened over the last five years within the consumer staples sector,” the HSBC report noted.
ITC also has plans for setting up a biscuit manufacturing plant at a cost of Rs 70 crore, which, according to HSBC, would imply that ITC visualises a 50% growth in the size of the brand over the next two years. ITC said its foods business is powered by the agri-sourcing strength of its e-choupal network, cuisine expertise of its ITC Welcomgroup hotel chain, product development capabilities and branding, trade marketing & distribution competencies.
ITC has built up a network of 6,000 e-choupals, or internet booths manned by villagers that offer farmers advice on market and weather trends among other things. This chain, covering 36,000 villages across nine states, helps ITC help buy the best produce and also sell third party products to rural India. Such transactions added up to over Rs 100 crore last year, ITC said.
“Wheat procurement through the network doubled over the previous year, leading to substantial cost and quality advantage for ‘Aashirvaad’ atta, ‘Sunfeast’ biscuits and ‘Sunfeast’ pasta,” ITC said. ITC’s distribution network now covers around 14 million households. Between 2003 and 2005, ITC added 1.2 million retail outlets to its FMCG business, the largest by any company in India.
The Sunfeast brand, which covers a wide range of tastes, is now ITC’s flagship in sports sponsorship, having been the title sponsor of the Sunfeast Open 2005, the first of its kind Women Tennis Association tournament held in Kolkata.