Our Kolkata Bureau

KOLKATA 3 AUGUST

PUSHING SALES targets and higher profits have become a way of life at ITC. These days, such things alone do not excite the company’s visionary board so much. The challenge now seems to be meeting commitments beyond the market. The passion shows on chairman Yogi Deveshwar’s face.

"ITC believes that its aspiration to create enduring value for the nation provides the motive to sustain growing shareholder value," Mr Deveshwar told company shareholders at the 90^th annual general meeting in Kolkata on Friday. He said the philosophy was not only driving businesses towards international competitiveness, but also contributing to enhancing the competitiveness of a larger value chain of which the company is a part. Illustratively he mentioned ITC Bhadrachalam Paperboards.

From an entity steeped in trouble not long ago, ITC Bhadrachalam has come a long way. The aggressive pursuit of international competitiveness has enabled the paper and paperboards company to fundamentally transform itself.

Mr. Deveshwar said the company had created value-added products by absorbing state-of-the-art technology. It has also attained global benchmarking in both cost and quality, besides having effectively implemented an energy and fibre strategy to carve out a distinctive and sustainable competitive advantage. Mr. Deveshwar said ITC Bhadrachalam’s story has been so satisfying in the last few years that it has encouraged the company’s board to tout growth plans, entailing investments up to Rs.1,500 crore in the next five to seven years.

"Given adequate support for fibre and energy, this investment programme, on successful completion, carries the potential to catapult this company into a position of leadership in the value added segment in the Afro-Asian part of the globe.

Besides, paper and paperboards, the other example of long-term strategic approach is the ITC group’s commitment to its hotels business. Even though the present market conditions are tough, leading to sluggish growth, the long-term prospects are promising, Mr. Deveshwar said.

That the company is now changing its image as a cigarette maker is evident from its decision to drop the dots from its name I.T.C. "The `T’ no longer stands for tobacco alone," the chairman said. It represents trademarks, technology, travel and tourism, totality of business in the interest of shareholders, he said, explaining the name change. "ITC today is a multi-dimensional company, and must be understood as such," he said.

Mr. Deveshwar reiterated the company’s relentless pursuit against contraband cigarettes. "Smuggled cigarettes are a problem. We are continuously in dialogue with the government for tax moderation since it is the only way to curb contraband cigarettes from entering the country in a big way. It will also increase the overall revenue base of the government," the ITC chairman said.

Mr. Deveshwar has a long battle ahead. Of course, he also has the shareholders’ permission to continue as chairman for another five years or till retirement, whichever comes earlier.