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Despite dissenting voices move to diversify has paid off
Indian Express - 31 Jul 2014

Y C Deveshwar said ITC would now want to enter areas of  fruit juices, tea, coffee.

ITC chairman Y C Deveshwar  today said it was heartening to see that the company had diversified and built  several brands to get a fair degree of consumer franchise.

He said the company was now  looking at entering into newer areas of food business.

"I am happy that we did  not take note of the dissenting voices which were opposing the company's move  to branch out in other areas besides tobacco," Deveshwar told shareholders  at the company's AGM here today.

In 1996 there was opposition  from a section of the shareholders when the company wanted to diversify.

"It is not easy to  build brands. In ITC  Ltd we have international brands and the company had  been able to build a fair degree of consumer franchise," he said.

The traditional cigarettes  business, he said, had been subject to continuous high incidence of taxation  and would exert pressure on the legal industry volumes and sub-optimise the  revenue potential from the tobacco sector.

Deveshwar said ITC would now  want to enter areas of fruit juices, tea, coffee, chocolates and dairy  products. "Entering into these products because this is the best time to  absorb the cost of gestation," he added.

The tobacco business  continued to be the highest revenue grosser for the company followed by  agri-business.

Deveshwar said ITC was  investing in 65 projects involving an investment of Rs 25,000 crore and were  currently under implementation or in advanced stages of planning.

"These projects are  distributed across a majority of states and West Bengal has a high share with  an outlay of Rs 3,500 crore encouraged by the conducive policies of the state,"  he said.

"In my belief, the  company can aim for a revenue of Rs one lakh crore from the new FMCG businesses  by the year 2030 and be the number one FMCG player in India," Deveshwar  added.

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