ITC may consider investing in neighbouring countries to power the expansion of its FMCG business beyond the Indian shores.
The company, which aspires to build global Indian brands that can compete internationally, hopes to build on the rapidly expanding export basket of FMCG products.
ITC is counted among the top food companies in India, creating the new growth vertical over the last two decades by ploughing in profits from the legacy cigarette business.
“So far we have been focusing on the Indian market and we have got scale (here). In the last two to three years, we have started to export. We are in 70 countries,” said Sanjiv Puri, chairman and managing director of ITC Ltd.
To begin with, ITC is manufacturing biscuits (Dark Fantasy) in Nepal through the company’s subsidiary Surya Nepal Private Ltd. Puri indicated the company will look at proximal markets for the FMCG expansion.
“We are building the infrastructure and apparatus and over time, we will scale it up and back it up with investment into certain priority markets that are going to develop in future, for example in some proximal markets. It has started a bit in Nepal through our subsidiary there,” Puri said earlier this week.
The chairman was responding to a question on building brands. “(We) want to build world class Indian brands that will delight consumers across the world,” he said.
With Indian consumption rising, many international brands or companies with foreign parents are doing brisk business in the country.
Consequently, the economic surplus created from doing business is flowing back to the countries where the multinationals are domiciled.
“We have to go beyond the Indian shores and create global friends so that value can come back to India and get re-invested unlike today’s situation. As the consumption in India is growing, value is going out of the country and, therefore, jobs are getting exported,” Puri said.
Foreign exchange earnings of ITC Group over the last 10 years aggregated around $9 billion, of which 60 per cent was from agri export, according to the FY23 annual report. The PLI scheme of the central government has given fillip to ITC’s exports in biscuits and cakes, dairy and ready to eat categories.