Our Corporate Bureau

Kolkata, July 30: ITC Ltd’s foods division expects to achieve a turnover of Rs 500 crore within the next four years, according to Mr Ravi Naware, the chief executive of the unit.

"Out of the Rs 500 crore, the biscuits business should contribute around Rs 200 crore," Mr Naware said here on Wednesday. He was addressing a press conference at the launch of the "Sunfeast" brand of biscuits.

He said the food division is yet to reap a profit, since it is one of ITC’s recent forays. "We expect the division to earn profit by the same time when it will achieve the Rs 500-crore turnover," Mr Naware said

He said that ITC expects to capture around 11 per cent share in the biscuits market within the next 3 years. "This will put us in the 3rd position in the biscuits market," he said.

According to him, the current size of the Indian biscuits market is around Rs 4,500 crore, out of which the size of the organised sector is Rs 2,700 crore. In terms of volumes, Mr Naware said, the total production of biscuits in India currently stands at around eight lakh tonnes out of which 4.5 lakh tonnes come from the organised sector.

"There has been a tremendous growth in the biscuits market during the last couple of years specially in 2002-03, when the market grew by around 12 per cent. This overall market growth has prompted ITC to venture in the field in a big way," he said.

He said that ITC expects maximum sale of biscuits in west India which will cater to around 29 per cent of the company’s total biscuits sales. "The share of east and south will be somewhat similar at around 23 per cent," he said.

He said that currently ITC has two contract manufacturing units - at Burdwan in West Bengal and Nagpur in Maharashtra. The management, he said, is considering opening two such additional contract manufacturing units one in north and the other in South India. "This will help us in minimising the logistics cost and will also enable us to provide fresh biscuits all over the country," Mr Naware said.

He said that the current capacity of the Burdwan unit is 700 tonnes a month. However, he ruled out the possibility for ITC opening its own manufacturing unit.

"We will restrict ourselves in training the people in the contract manufacturing units, so that there is a consistent quality production," he said.

According to Mr. Naware, that during the current financial year, the company’s food division will concentrate mainly on strengthening of its distribution network.

"We are looking at sales or profit right at this moment. Our primary aim now is to make our products available in all corners of the country," he said.

He refused to divulge the details of the company’s planned expenditure in promoting its food brands. "Marketing and promotional spends will be tailored according to necessity," he said.

Mr. Naware further said that the company has no plans to go for export of biscuits in a big way immediately. "However, we will concentrate on exports of confectioneries," he said.

Mr. KN Grant, chief executive of the tobacco division, pointed out that ITC has the best collection of chefs, who have the best recipes. "Probably, that prompted the management ITC to diversify from tobacco to this sector," he said.