Comparative Research On Market Size of Cigarette Brand of IT

Comparative Research on Market Size of Cigarette Brand of ITC Ltd.
REASEARCH REPORT
ON Comparative Research on Market Size of Cigarette Brand of ITC Ltd.
Master of Business Administration 2009-11

SUBMITTED TO: G.B.T.U. Lucknow SUBMITTED BY: Gopal Jiaswal Roll no. 0928570006 MBA (4th Sem.)
INSTITUTE OF TECHNOLOGY AND MANAGEMENT
PANCHLI, MEERUT
ACKNOWLEDGEMENT
Before, I get into thick of things, I would like to add a few heartfelt words for all those people who were part of this report in numerous ways, and gave their unending support throughout. I wish to express my thanks and gratitude to all those who have provided the valuable support, insight and encouragement during my research at ITC Ltd. In the process of completing this project Comparative research on Cigarette brands. I have received cooperation from many quarters. I express my sincere gratitude and indebtness to Mr. Krishna Awtar Pandey, my research guide for his inspiring guidance, cooperation and for giving me an opportunity to enhance my skill in the field of my project in carrying out my research successfully. I am thankful for his guidance, patience and consummate support. He came to my help when it counted and I extend my heartiest thanks to him form enlightening my path. Moreover, I would also like to acknowledge my profound sense of gratitude and indebtness for Mrs. Sachi Rana (H.O.D. MBA Deptt.) for her cooperation, guidance, support and precious suggestions that motivated me in completing this project. I would like to extend my heartily gratitude to Mr.Deepak Gupta (Faculty, MBA) for his contribution, generous help, personal support and his valuable suggestions, guidance and personal attention, which enabled me to complete my research. I wish to express grateful feelings and thanks to all the faculties of MBA department, who helped me in various ways in the research completion and for their valuable suggestions. I am thankful for their generous help, personal support and their valuable suggestions during the course of MBA. I express my thanks to my friends who helped me during my research. I dont have enough words to express my love and thanks to my loving and caring guardians, especially for their endless love and care. It was their constant encouragement and their trust in me that has helped me at every crucial stage of development.
I also feel grateful and elated in expressing my indebtedness to all those who have directly or indirectly helped me in accomplishing this research work. I wish to express grateful feelings and thanks to ITC Ltd for giving me such a great opportunity to complete my research.
Gopal Jaiswal
STUDENT DECLARATION
I, GOPAL JAISWAL under signed hereby declare that the project report on
Comparative Research on Market Size of Cigarette Brand of ITC Ltd. complied and submitted under the guidance of Mr. Deepak Gupta , Faculty of Management, ITM, Meerut is my original work. The empirical finding in this reports are based on the annual reports of the company. While preparing this report, I have not copied material from any report.
GOPAL JAISWAL
Roll No. 0928570006
M.B.A.III Sem.
PREFACE
The changing marketing scenario emerging by virtue of liberalization in last one decade has introduced a vast variety of new concepts. Behavioral analysis gives much information at a single time. In the changed business scenario, where organizations are required to compete globally, benchmarks have also become global, organization survival and excellence requires not only meeting the targets, but also setting up of global standards. In the present scenario, to achieve world-class excellence or even surpass them depends upon the efficiency-marketing scenario of the company, which is the most important for any organization. The quest of productivity, quality and speed has spawned a remarkable number of management tools and techniques. Total quality management, bench marking, and Time based competition. Out servicing partnering, reengineer, change management of feeling the gap between the originations and the consumer, on the bases of market research are conducted by the big organizations. Now it is a world of world of cut throat competition. The concept of marketing has been changed completely; customer has become aware in the every field in the current time, todays market is customer oriented. The prime motive of the company should be customer delight and hence to survive and achieve organizational goals. Cigarette is one of the tobacco products. Cigarette itself has a niche in the market. Tobacco products are excisable item, which is controlled by the Government. The Government earns much money from tobacco product due to much excise duty on tobacco product. The tobacco companies work under the rule and regulations of the Government. It is very necessary and compulsory for manufacturers of tobacco to take license from the Government.
This research report has been divided in to various parts. First part gives an introduction about the project. Second part contains profile of the company and its financial overview. Third part is objective and scope of study. Fourth part is all about research methodology. Finally data interpretation and analysis of data, on the basis of analysis some recommendations and conclusions are given. In the end I would like the evaluators and readers to do a comprehensive study of my project and express their views and recommend valuable suggestions that would greatly enhance our knowledge of the subject.
CONTENTS
1 ACKNOWLEDGEMENT
2 EXECUTIVESUMMARY
3 OBJECTIVE OF THE PROJECT
4 INTRODUCTION
5 COMPANY PROFILE
6 SWOT ANALYSES
7 RESEARCH METHDOLOGY
8 DATA ANALYSIS & INTERORETATION
9 CONCLUSIONS
10 LIMITATIONS
11 RECOMMENDATIONS
12 BIBLIOGRAPHIES
13 QUESTIONNAIRES
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
The aim and objective of this research is to measure the brand image during the product purchase. ITC has a large customer base providing three types of cigarettes. My area of research is SHARANPUR and adjoining places. I have chosen this topic (project) because fulfilling brand images needs of the people is a major task, slight improvement of which will lead to an increased customer base and higher customer retention ratio which will lead to an increased customer base and higher customer retention ratio which will lead to an increase in companys sales and an enhanced brand image.
OBJECTIVE OF THE RESEARCH
Research Objective Primary Objective

1. To find out brand image of ITC Ltd. in area of Sharanpur 2. Find out whether there is an image mismatch between the FMCG brand and customer.
Secondary Objectives:1-To find out how to improve the brand image 2-Which is higher selling brand in deferent area 3-Which brand ensure proper availability of CIGGRETE? 4- How much ITC Product contributed in every outlet? 5- To find out Brand Promotional activity in the Market. 6- To create the ways to promote ITC as BRAND. 7- To determine the demand of the Cement. 8- To design marketing Strategy
The research conducted thus emphasized in fulfilling following objectives:
FROM THE ORGANIZATION POINT OF VIEW

Organization would be coming to know about the dealers attitude and their Complaints by this they can take corrective measures to rectify the complaints. Organization can also find its market share
MY POINT OF VIEWS:-
I while undergoing my training got familiar with the organization ITC Ltd. Cigarettes and came to know about the working of the organization as well as the services, policies etc. of the organization.
INTRODUCTION
INTRODUCTION
Marketing Research is a vehicle through we can obtain information about present and potential customers behavior, their reaction and prospective about marketing. Learning more about the consumer and marketing is the heart of marketing research. The objective of this study is to know about the consumers perception & preference towards cigarette of ITC Ltd. Cigarette itself has a niche in the market The Tobacco industry is developing with speed of app. 15%. The ITC enjoys a good position in the Cigarette Market by launching - Checkers, Hi-Val, Royal Classic and Gold Crest - in the extremely competitive US market. The coming up of Multinational in the field has made it tough for the company to capture the same market share as it was enjoying few decades ago. Since thirty years put now seeing the current requirements the company decided to change its old pattern and planned to walk with the Traits. This study contains the about the reaction of consumers towards the Cigarette. The target consumers are there figured and the area for research is also sound and through it. Tobacco consumption is growing at a rate of 2-3% per annum. India is the third largest producer and eighth largest exporter of tobacco and tobacco product in the world. The largest selling cigarette in India is of ITC Ltd according to experts ITC commands a 72% market share in the country and hence it is a market leader in the segment. . This report is aiming to find out the market size of cigarette of ITC Ltd. This project is also directed to find out the contribution share of the various brands of ITC Ltd and the taste and preferences of cigarette consumers. The population survey was conducted in pre-allocated areas. Total number of respondents is 500, in which only 33% said that they smoke. Out of them 43% said that they consume cigarette. 70.42 % cigarette consumers consume ITC cigarette in the specified area. Quality of the product and Packaging is good but customers think that the price of the product is average. Availability of the ITC cigarette is good in the retail stores. Awareness about the brand is also found to be satisfactory. Most of the consumers
of ITC cigarette are found to be satisfied with the product. We find that the cigarette brand of ITC limited has a very good position in the market among the customers. Majority of consumers go for the taste of cigarette and brand name. While some of the consumers of cigarette emphasize on the price. ITC is enjoying the market leadership in the industry not because of its products but another reason is that it is the first entrant in the Indian cigarette market. Most of the cigarette brands of ITC are doing well while a few are not in a good position. ITC should offer some offers and discounts to the customers and retailers.
THE TOBACCO INDUSTRY IN INDIA

4 players - ITC, Godfrey Phillips, VST and GTC, dominate the cigarette industry in India. These four companies together control almost 99% of the market. The cigarette industry faces competition mainly from the unorganized sector 'BIDI' manufacturers, who are protected from high duties due to small-scale industry status. Affected by steep duty hikes, the industry has been facing stagnant volume growth in the last 2-3 years. Based on the contribution from various products, ITCs business can be divided into three main divisions, namely cigarettes, tobacco and agri-products. ITCs mainstay of earnings is cigarettes (87%) and tobacco (3%). Agri-products business contributes 5% of the total revenues, while other businesses of hotels, paper and packaging collectively contribute the balance 5%. Tobacco today is one of the largest contributors to Indian excise collections. Despite that the industry has been getting step-motherly treatment by the central government. The industry has been facing regular increase in excise duty on cigarettes in every budget for past so many years. The cigarette industry in particular has been suffering both at the hands of central government as well as state governments.
Industry background:
India is the third largest producer and eighth largest exporter of tobacco and tobacco product in the world. While India's share in the world's area under tobacco crop has risen from 9% to 11% in the last 3 decades, its share in production has inched up from 8% to 9% in tobacco industry. Asia and America, together account for 75% of world's production of tobacco. China, USA and India are the three leading tobaccoproducing nations in the world. Andhra Pradesh, Gujarat and Karnataka account for the major portion (80%) of raw tobacco production in India. These states produce FCV tobacco, bidi tobacco, natu tobacco, cigar tobacco, cheroot tobacco and snuff tobacco.
Other states which manufacture tobaccos are Maharashtra, Orissa, Tamil Nadu, West Bengal, UP and Bihar. Tobacco is consumed in two ways, either by smoking or chewing. While smoking the following tobacco products are consumed: Cigarette, Cigar, Bidi (Hand rolled leaf wrapped country cigarettes) and to chew the products are: Raw tobacco, Supari (Areca nut), Gutkha, Pan Parag etc.. Due to diverse climatic conditions every type of tobacco is grown in India. Almost 90% of area is accounted for by Nicotine tobacem. and 10% by Nicotina Restica. Only one third of the tobacco output in the country is Flue cured Virginia (FCV) variety, suitable for cigarette manufacturing. As per World Health Organization (WHO), reported the prevalence tobacco habits in India to be, Bidis (34%), Cigarettes (31%), Chewing tobacco (19%), Hookah (9%), Cigars-cheroots (5%), and Snuff(2%). There are seven major categories of tobacco, Viz. Flue cured Virginia tobacco (FCV), Burley, Oriental, Bark flue cured, Sun cured, Light flue cured cigar and Dark flue cured. Flue cured Virginia tobacco is mainly used for manufacture of cigarettes. Light air cured tobacco is used in the manufacture of bidis. Unmanufactured tobacco is also consumed in India, for chewing purpose. Chewing tobacco has been a tradition in India for centuries. Of the total amount of tobacco produced in the country, around 48% is in the form of chewing tobacco, 38% as bidis, and only 14% as cigarettes. Thus, bidis, snuff and chewing tobacco (such as gutka, khaini and zarda) form the bulk (86%) of India's total tobacco production. In the rest of the world, production of cigarettes is 90% of total production of tobacco related products. The per capita consumption of cigarettes in India is merely a tenth of the world average. This unique tobacco consumption pattern is a combination of tradition and more importantly the tax imposed on cigarettes over the last 2 decades. Cigarette smokers pay almost 85% of the total tax revenues generated from tobacco.
India is a major grower and exporter of tobacco in the world. Presently India is among top three producers of tobacco in the world. Despite lower proportion of total produce being exported Indian exports it figure among top 10 exporters of the product in the world. In addition to being the largest contributor to government coffers, the industry also provides employment to more than 26mn people in the country both directly and indirectly. The Indian tobacco is largely used for making beedis and chewing products like khaini etc. Tobacco is a very peculiar crop, it is grown in rain starved areas on soils which are otherwise not suitable for any other crop. Thus it makes use of the least resources available to it, to give a produce which provides so much to government coffers in terms of excise, exports as well as employment that today the per acre earning of Farmers from a special type of tobacco are much higher than any other crop grown in the country. India is the second largest producer of tobacco in the world after China. It produced 572 m kgs of tobacco in FY03. However, India holds a meager 0.7% share of the US$ 30 bn global trade in tobacco, with cigarettes accounting for 85% of the country's total tobacco exports. Despite being the second largest producer, India is only the ninth largest exporter of tobacco and tobacco products in the world. Out of the total tobacco produced in India, only one-third is flue-cured tobacco suitable for cigarette manufacturing. There are various types of tobacco grown in the country but most of the exports of tobacco by our county is of Flue Cured Virginia (FCV) type. The Indian tobacco exported, is mostly used as filler in the international cigarettes. Infect like any other agri-product, the characteristics of tobacco, its taste, its aroma and other properties largely depend on the soil or area in which it is grown. Moreover cigarette smokers are very particular about the taste, the aroma of their cigarette brand. So it becomes extremely necessary to maintain the blend of tobacco used for cigarette manufacturing to give the same quality product to consumers. This is to maintain the consistency of taste of a brand.
Woes of the tobacco industry:

If we take a glance at the current situation of the tobacco industry we will find that the situation is just like that of a farmer killing the hen that laid golden eggs. Today the government is milching the industry, especially the cigarette industry, to such an extent that the industry would very soon die an unnatural death. Infact the indications from trend of consumption and excise collection just corroborate these fears. Presently tobacco industry's contribution to excise has increased from mere 7.2% in 1987-88 to 12% in 2000-01. This is in contrast with the international scenario where the cigarette contribution to total tobacco consumption has increased. Besides this, already the cigarette industry is gasping for breath due to imposition of luxury tax or entry tax by various states ranging from 1.5% to 10%. The legislation dates back to 1975 when the Tobacco Board Act was introduced to develop the tobacco industry, which facilitated regulation of production and curing of tobacco, fixed minimum prices and provided subsides to tobacco growers. Again in 1975, Cigarettes Act of 1975 was passed. It was India's first national level antitobacco legislation and prescribed all packages to carry the warning "Cigarette smoking is injurious to health". Prevention and Control of Pollution Act was introduced in 1988, which included smoking in the definition of air pollution. The Motor Vehicles Act of 1988 made it illegal to smoke or spit in a public vehicle. The Cable Television Networks Amendment Act of 2000 prohibited the transmission of tobacco commercials on cable television across the country. In February 2001, Indian Prime Minister Vajpayee's union cabinet introduced Cigarettes and other Tobacco Products Bill. This was a multifaceted anti-tobacco legislation to replace the Cigarettes Act of 1975. According to this bill, smoking in public places would be outlawed, sale of tobacco to people under 18 years of age would be prohibited, tobacco packages required to have warnings and it also prohibited tobacco companies from advertising and sponsoring sports and cultural events. This bill covers most tobacco products like cigarettes, cigars, bidis, cheroots, pipe tobacco, hookah tobacco, chewing tobacco, panmasala and gutkha. A first time offender will result in a fine of rupees 200
and a second time offender will result in a fine of rupees 1,00,000 and imprisonment for up to three years. Delhi was the first to impose a ban on smoking in public. In 1996, Delhi Prohibition of Smoking and Non- Smokers Health Protection Act was passed. This act prohibited sale of cigarettes 100 meters from the school building and to minors. The offender was fined a sum of rupees 100. But it was difficult to enforce this act and had little real impact, the key problem being lack of manpower to enforce the law. In 1999, Kerala High Court came out with a judgment prohibiting smoking in public places, including parks and highways and Goa banned smoking in public places through antitobacco legislation. For the past three years, Tamil Nadu and Andhra Pradesh have banned the marketing and sales of gutkha. In such a scenario of rising taxes and decreasing consumption, any further imposition of levies or taxes on the cigarette industry seems unjustified. So I think that the government should give a glance to these aspects and should try to see the situation from cigarette industry's point of view before finalizing any proposal.
Annual Per Capita Adult Cigarette Consumption

3000 2500 2000 1500 1000 500 0
pa n na N ep al ta n C hi ak is Ja 'd es h In di a U K U S
Japan US UK China Nepal Pakistan B'desh India
Source: Tobacco Institute of India
PRESENT SCENARIO
Cigarette manufacturers are planning to raise the rates because of the high taxes and recently VAT in many states and the price of a few cigarette brands have been raised already. A pack of the premium brand Classic was re-priced at Rs 88 from Rs 80 earlier while a pack of the mid-market Gold Flake brand was now priced at Rs 40 against Rs 38 earlier. The economy brand Silk Cut had also been revised upwards marginally from Rs 20 now, retailers added. Tobacco industry in India, boasts of a growth of 25 percent per year. The cigarette market in the country is estimated at 2 million sticks including made in Goa, a quantum jump from six lakh sticks in 1997. Cigarette is the largest segment of the tobacco industry in the country. India today is the largest consumer of cigarette overtaking USA two years ago. The cigarette market is witnessing flurry of launches from the MNCs by having their collaborations done with the India partners. These collaborations done by then are in two ways either shares of profits or technical partnership. The largest selling cigarette in India is of ITC Ltd. It Commands a 72% market share in the country. Prevention against the diseases that come with tobacco usage is based primarily on public and individual education to drop the habit or preferably not to begin in the first place. Some of the steps to be taken as suggested are Providing effective protection from involuntary exposure to tobacco smoke Providing effective program of health promotion and health education Effective smoking cessation program Prominent health warnings on tobacco product packing Progressive elimination of tobacco advertising Financial measures to discourage tobacco consumption Preventing children from becoming addicted to tobacco
Tobacco consumption is growing at a rate of 2-3% per annum. Since there is good growth in the cigarette industry but there are many restrictions and hurdles created in this industry by the government. So the companies need to move forward with care. Firms should also focus on the risk distribution against the core competency.
COMPANY PROFILE
ITC Ltd. An Overview
THE COMPANY PROFILE

ITC is one of India's foremost private sector companies with a market capitalisation of nearly US $ 18 billion and a turnover of over US $ 5.1 Billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC also ranks among India's top 10 `Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Branded Apparel, Packaged Foods & Confectionery, Greeting Cards and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery. The ITC Ltd Type Founded Headquarters Key people Industry Products Revenue Employees Website Public (BSE:ITC) August 24, 1910 Radha Bazar Lane, Kolkata, India Virginia House, Kolkata, India Y C Deveshwar, Chairman K Vaidyanath, Director, Partho Chatterjee, CFO Tobacco, Foods, Hotels, Stationery, Greeting Cards Cigarettes, Packaged Food, Hotels, Apparel $ 5.1 billion USD Over 29000 www.itcportal.com
As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this source
of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practises this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new Businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is aggressively pursuing emerging opportunities in providing end-to-end IT solutions, including e-enabled services and business process outsourcing. ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to be rated for Corporate Governance by ICRA, an associate of Moody's Investors Service, which accorded it the second highest rating, signifying "a high level of assurance on the quality of corporate governance."
ITC employs over 29,000 people at more than 60 locations across India. Ranked among India's most valuable companies by the 'Business Today' magazine, The Company continuously endeavors to enhance its wealth generating capabilities in a globalising environment to consistently reward more than 3,83,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder." Over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder."
THE ITC VISION
THE ITC MISSION
Key points
Strong volume growth in the core cigarette business in Q1FY200511% yearon-year, among the highest in the previous ten quarters. This is the third consecutive year of no excise duty increase and the second year of no price hike in cigarettes, leaving scope for the company to hike cigarette prices and boost its profits further. Diversification is paying off with non-cigarette businesses like hotels, paper and agri-products turning around. ITC's core business of cigarettes, we believe, will continue to grow at 4% in FY2008 in volume terms. Besides, it has made an entry into bakery and other fast moving consumer goods (FMCG) product lines (such as soaps, detergents and food products), which will benefit from its strengths in distribution. Meanwhile almost all of ITC's earlier diversifications are paying offthe hotels, paper and the agri-product ventures are likely to return the cost of capital invested in the next couple of years. Its capital expenditure needs are limited and litigation risks have all but disappeared. Hence we expect higher dividend payouts. We recommend buying this Apple Green stock.
Increase in other expenditure mainly coming from increased advertisement spends before the "Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003"
ITC has diversified presence in
Cigarettes: W. D. & H. O. Wills, Insignia, India Kings, Classic, Gold Flake, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake Hotels: ITC Welcomgroup chain of Hotels Paperboards & Specialty Papers: ITC Bhadrachalam Paperboards Limited"ITC Tribeni Tissues Division" Now there are four units under one name --> Paper Boards and Specialty Papers Division, Unit - Bhadrachalam, Tribeni, Bollarum and Kovai.
Agricultural Industry: Agri-Business, Leaf Tobacco, Gold Ribbon, Blue Ribbon, Aqua Kings, Aqua Bay, Aqua Feast and Peninsular Packaged Foods & Confectionery: Kitchens of India, Aashirvaad, Sunfeast, MintO, Candyman, Bingo Snacks Branded Apparel: Wills Lifestyle, John Players, Miss Players Personal Care: Essenza Di Wills, Fiama Di Wills, Superia, Vivel Di Wills, Vivel Greeting Card: Expressions Information Technology: ITC Infotech Safety Matches: iKno, Mangal Deep(Discontinued), VaxLit(Discontinued), Delite(Discontinued) and Aim Brands acquired from Wimco (Swedish Matches) Incense Sticks: Mangaldeep, Spriha Stationery: Classmate, Paperkraft, Saathi
Products of ITC Ltd.
History of ITC Ltd

ITC was incorporated on August 24, 1910 under the name of 'Imperial Tobacco Company of India Limited'. Its beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. This decision of the Company was historic in more ways than one. It was to mark the beginning of a long and eventful journey into India's future. The Company's headquarter building, 'Virginia House', which came up on that plot of land two years later, would go on to become one of Kolkata's most venerated landmarks. The Company's ownership progressively Indianised, and the name of the Company was changed to I.T.C. Limited in 1974. In recognition of the Company's multi-business portfolio encompassing a wide
range of businesses - Cigarettes & Tobacco, Hotels, Information Technology, Packaging, Paperboards & Specialty Papers, Agri-Exports, Foods, Lifestyle Retailing and Greeting Gifting & Stationery - the full stops in the Company's name were removed effective September 18, 2001. The Company now stands rechristened 'ITC Limited'. Though the first six decades of the Company's existence were primarily devoted to the growth and consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the beginnings of a corporate transformation that would usher in momentous changes in the life of the Company. ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's Cigarettes business. It is today India's most sophisticated packaging house. In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennai which was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of ITC's entry into the hotels business was rooted in the concept of creating value for the nation. In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited, which today has become the market leader in India. Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for export of agri-commodities. The Division is today one of India's largest exporters. In 2000, ITC launched a line of high quality greeting cards under the brand name 'Expressions'. In 2002, the product range was enlarged with the introduction of Gift wrappers, Autograph books and Slam books. In 2003, the company rolled out 'Classmate', a range of notebooks in the school stationery segment. ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wears for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded its range to include Wills Classic formal wear (2002) and Wills Clublife evening wear (2003). ITC also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills
Lifestyle India Fashion Week. In 2007, the Company introduced 'Miss Players'- a fashion brand in the popular segment for the young woman.
In 2000, ITC spun off its information technology business into a wholly owned
subsidiary, ITC InfoTech India Limited, to more aggressively pursue emerging opportunities in this area. Today ITC InfoTech is one of Indias fastest growing global IT and IT-enabled services companies and has established itself as a key player in offshore outsourcing, providing outsourced IT solutions and services to leading global customers. ITC's foray into the Foods business is an outstanding example of successfully blending multiple internal competencies to create a new driver of business growth. It began in August 2001 with the introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the confectionery and staples segments with the launch of the brands mint-o and Candyman confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the Company entered the biscuits segment. ITC's entered the fast growing branded snacks category with Bingo! in 2007. In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro. ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of its partnership with the cottage sector. ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath & body care products for men and women in July 2005. Inizio, the signature range under Essenza Di Wills provides a comprehensive grooming regimen with distinct lines for men (Inizio Homme) and women (Inizio Femme). Continuing with its tradition of bringing world class products to Indian consumers the Company launched 'Fiama Di Wills', a premium range of Shampoos, Shower Gels and Soaps in September, October and December 2007 respectively. The Company also launched the 'Superia' range of Soaps and Shampoos in the mass-market segment at select markets in October 2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range of shampoos in June 2008.
The Core Competency

ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, it has a leadership position in every segment of the market. Its highly popular portfolio of brands includes Insignia, India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake. ITC's leadership is founded on its core strategy of continuously enhancing product values through significant investments in product design, manufacturing technology, quality, marketing and distribution. In just the last 5 years, ITC has made capital investments of over Rs. 7 billion in its cigarettes business. In ITC, one of the pioneers of market research in India, the consumer is still the King. The Company continuously endeavors to provide its consumers products that are benchmarked to international quality. This strategic focus on the consumer has paid ITC handsome dividends. The most important of these is its enriched product mix, unmatched by competition. ITC's share of filter cigarettes in the country is more than 70%. In pursuit of international competitiveness, ITC has launched four brands Checkers, Hi-Val, Royale Classic and Gold Crest - in the extremely competitive US market. Recently ITC has launched Royale Classic, Gold Cut and Scissors Filter Kings cigarettes in the Middle East. The response to these brands has been encouraging. ITC's cigarettes are produced in its state-of-the-art factories at Bangalore, Munger, Saharanpur and Kolkata. These factories are known for their high levels of productivity and very contemporary work environment. ITC's FMCG businesses have one of the largest retail networks in the country, consisting of over 2 million retailers. Its reach covers a wide range of the retail spectrum, from premium outlets in the metros to small shops in the interiors of rural India. All initiatives are therefore worked upon with the intent to fortify market standing in the long term. This in turns aids in designing products, which are contemporary and relevant to the changing attitudes and evolving socio economic profile of the country. ITC's Cigarettes business has won numerous awards for its quality, environmental management systems and product excellence.
Plant location
ITC's cigarettes are produced in its state-of-the-art factories at-
Bangalore, Monger,
Saharanpur Kolkata
SISTER CONCERN COMPANIES

ITC Bhadrachalam Paperboards Ltd (56.00%) BFIL Finance Ltd (99.99%) BFIL Securities Ltd (99.98%) MRR Trading & Investment Ltd (99.98%) ITC Hotels Ltd (71.23%) Srinivasa Resort Ltd (68%) Bay Island Hotels Ltd (100%) Greenace Holding Ltd (100%) Fortune Park Hotel Ltd (99.99%) Russell Credit Ltd (100%) ITC Infotech Ltd (100%) All India Tobacco Company Ltd (100%) Elan Enterprises Ltd (100%) ITC Global Holdings Pvt Ltd (100%)
COMPETITION
Todays world is the world of Competition. In every field there is competition, the success of any company or product is also largely depends upon competition. At present scenario customer became aware about the market, he has full knowledge of the market. Competition provides a good quality of product to the customers. If a company wants to survive itself he will have to face through-cut competition. In liquor industry there is also competition. The increasing awareness and exposure to wines among consumers and the removal of quantitative restrictions in 2001 has been a big boost to the wine industry. It saw the emergence of new companies like GODFREY PHILLIPS INDIA LIMITED, set up recently by two non-resident Indians (NRIs) from USA. The consumption of liquor is growing at 20 per cent per annum. CIGARETTE consumption in the country is slated to treble in the next ten years with the segment for strong beer segment registering high growth. It boasts of a growth of 25 per cent per year. The increasing awareness and exposure to wines among consumers and the removal of quantitative restrictions in 2001 has been a big boost to the wine industry.
Pie chart showing the cigarette market shares in India among big players
Cigarette Brands
Name of the Product

01. India King 02. Classic 03. Gold Flakes 04. Gold Flakes King 05. Filter 06. Wills 07. Wills Light 08. Wills King 09. Wills Filter 10. Wills Flakes 11. Scissors 12. Tiger 13. Charms Filter King 14. Charms 15. Charminar 16. Charminar Special 17. Cavenders 18. Cavenders Filter 19. Cavenders Leaf 20. Uttam 21. Cavenders Magnum 22. Four Square King 23. Four Square Filter 24. Four Square Special Filter 25. Chesterfield
Company
Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Indian Tobacco Company Wazir Sultan Tobacco Wazir Sultan Tobacco Wazir Sultan Tobacco Wazir Sultan Tobacco Godfrey Phillips India Ltd. Godfrey Phillips India Ltd. Godfrey Phillips India Ltd. Brooke Bond India Ltd. Godfrey Phillips India Ltd. Godfrey Phillips India Ltd. Godfrey Phillips India Ltd. Godfrey Phillips India Ltd. Godfrey Phillips India Ltd.
The major Competitors of ITC Ltd. Products 1) Godfrey Philips India Ltd.
Godfrey Phillips is the second largest player in the Indian cigarette industry with an annual turnover of Rs11bn. Incorporated in 1936; the companys operations primarily span the entire northern and western part of the country. The company established its own manufacturing facilities in 1944. Godfrey Phillips has two major stakeholders, the K.K. Modi Group and Philip Morris, and has over 15,000 shareholders. Headquartered in Delhi, Godfrey Phillips today boasts of two manufacturing facilities - located in Ghaziabad (near Delhi) and in Andheri (Mumbai), a state of the art R&D centre in Mumbai and a tobacco-buying unit in Guntur (Andhra Pradesh). The Company today manufactures some of the most popular cigarette brands in the country like Red and White, Four Square, Jaisalmer, Cavenders, Tipper and Prince.
2) Gallaher Asia Limited

The Company's roots date back to 1857 when Tom Gallaher started a business making Irish roll tobacco in Londonderry, Northern Ireland. In 1900, Queen Victoria awarded Gallaher a Royal Warrant, and in 1928 it became a public company for the first time. The first major acquisition took place in 1936 with Senior Service, then J.R. Freeman in 1947. Benson & Hedges was acquired in 1955, and Gallaher launched Silk Cut in 1963. The biggest change in the Company's history thus far happened in 1968 when American Tobacco Co. acquired Gallaher. American Tobacco Co. changed its name in 1969 to American Brands, Inc. After Gallaher became a wholly owned subsidiary of American Brands, Inc., it had several other diversified interests such as an optical company (Dollond & Aitchison) a kitchenware company (Prestige) and a whisky manufacturer (Whyte & Mackay). However, these were gradually disposed of, and Gallaher, under the ownership of American Brands, Inc., refocused as a 100% tobacco company in January 1996.
Gallaher demerged from American Brands in May 1997 and for the first time; Gallaher's Group Plc shares were listed on both the London Stock Exchange and its ADRs on the New York Stock Exchange. American Brands, Inc. also took the step of changing its name, and is now known as Fortune Brands, Inc. Since 1997, the Group has been transformed from a predominantly British and Irish company into a leading international tobacco group, assisted by the acquisitions of Liggett-Ducat and Austria Tabak. It is truly an international tobacco manufacturing and wholesale company now, employing over 11,000 people, with manufacturing plants in the UK, Russia, Kazakhstan, Austria, Sweden, Poland, Romania and Ukraine. Today, Gallaher is the fifth largest international tobacco company in the world and the fourth biggest in Europe (based on billions of cigarettes sold each year)
BUSINESS
4 players - ITC, Godfrey Phillips, VST (also a BAT affiliate) and GTC dominate the Indian cigarette industry. These four companies together control almost 99% of the market. The cigarette industry faces competition mainly from the unorganized sector 'bidi' manufacturers, who are protected from high duties due to small-scale industry status. Affected by steep duty hikes, the industry has been facing stagnant volume growth in the last 2-3 years. Cigarette sales dropped by 4% in volume terms in FY00. The 200001 budget also hiked excise on all types of cigarettes by 5%. Based on the contribution form various products, ITCs business can be divided into three main divisions, namely cigarettes, tobacco and agri-products. ITCs mainstay of earnings is cigarettes (63%) and tobacco (3%). Agri-products business contributes 5% of the total Rs80bn revenues, while other businesses of hotels, paper and packaging collectively contribute the balance 5%.
Cigarettes/ Tobacco:
ITC has a broad-based presence in all the segments of the cigarette market. Scissors is the brand leader in volumes and Wills Gold Flake family is the single largest consumer product trademark in India. Of the total produce more than 70% is in the filter cigarette category while rest is in non-filter category. The company has also shifted 45% of its cigarette sales in form of hinged lid packaging. During FY00 the company extended its Gold Flake brand to other tastes and flavours. Two of its brands namely, Checkers and Hi-Val sell more than 100mn sticks per month in USA. Cigarette volumes declined by 2.4% yoy in FY00. Average per unit realizations however improved during the year by 9% yoy to Rs1049 per 1000 sticks. Tobacco: ITCs India Leaf Tobacco Division (ILTD) procures tobacco directly from farmers and also through auctions/ traders. ILTD works with the Tobacco Board to help farmers in developmental activities. ILTD also supplies tobacco to an associate company VST and other cigarette companies, besides exporting. ITC is one of the leading exporters of leaf tobacco. Exports are mainly to Latin America, South East Asia, and Western Europe and also to CIS markets. The division's performance has got affected due to oversupply situation in the global market. Moreover unauthorized production of tobacco has also increased leading to excess availability. Tobacco board has recently declared a crop holiday in the state for tobacco. The Andhra Pradesh plant of the company at Chirala was awarded Golden Peacock award for environmental management during FY00. The plant has also been awarded social accountability Standard certification from Bureau Veritas Quality International. The company produced 24,026 tons of unmanufactured tobacco during FY00. It contributed 3% of the total revenue during the year.
Hotels:
ITC Limited entered the hotels business in 1975 with the acquisition of a hotel in Chennai, which was Hotel Chola. Since then the ITC-Welcomgroup brand has become synonymous with Indian hospitality. Today amongst India's finest and fastest growing hotel chains, it consists of over 90 hotels across 77 destinations in India. These include super deluxe and five star hotels, heritage palaces, havelis and resorts and full service budget hotels. The 442-room ITC Maurya at New Delhi is not only amongst the leading business hotel in the country, but is in a class by itself. Bukhara at ITC Maurya in New Delhi has been declared the Best Indian Restaurant in the world by 'The Restaurant Magazine', UK. It has also been voted the Best Restaurant in Asia and was the only Indian restaurant to feature in the list of 50 Best Restaurants in the World from 2002 to 2007. The 386-room ITC Maratha, opened in February 2001, is perceived as amongst the leading and the finest properties in Mumbai, designed in a grandiose classic style, the hotel pays tribute to Mumbai's colonial roots and the spirit of the Great Marathas. ITC has been investing very heavily in its hospitality business. During FY00 the company acquired land from its subsidiary, ITC hotels and started construction of Super Deluxe hotel. The construction work is till in progress. The company's Maurya Sheraton hotel has received ISO14001 certification during the year.
INFORMATION TECHNOLOGY
ITC Infotech, a global IT services company, is today one of Indias fastest growing IT services and solutions providers. Based out of a picturesque 35-acres campus in the heart of Bangluru city, ITC Infotech, through wholly owned subsidiaries in the UK and US, provides outsourced IT services and solutions to leading global customers. ITC Infotech offers IT services and solutions across five key industry verticals: Banking, Financial Services & Insurance (BFSI), Consumer Packaged Goods (CPG) & Retail, Manufacturing & Engineering Services, Travel, Hospitality & Transportation and Media & Entertainment. ITC Infotech conforms to the highest standards in international process quality, with ISO 27001, ISO 9001, SEI CMM Level 5 and BS 7799 accreditations.
These reflect the companys ongoing enterprise-wide focus to ensure that every engagement, program and project delivers international quality consistently. Industry Recognition Premier analyst and market research agencies have recognized ITC Infotechs position as the preferred IT partner. It has been:
Featured amongst Top 100 Global Outsourcing Companies in the Leaders category - International Association of Outsourcing Professionals Ranked amongst Top 10 Specialty Application Development Providers - Global Services, CMP Media. Named amongst major Indian global service providers for PLM implementation and engineering services - ARC Advisory Listed as a leading Player in CRM & CPG Space Forrester Mentioned amongst Top Offshore SAP Service Providers Forrester
Foods
ITC made its entry into the branded & packaged Foods business in August 2001 with the launch of the Kitchens of India brand. A more broad-based entry has been made since June 2002 with brand launches in the Confectionery, Staples and Snack Foods segments. The packaged foods business is an ideal avenue to leverage ITC's proven strengths in the areas of hospitality and branded cuisine, contemporary packaging and sourcing of agricultural commodities. All products of ITC's Foods business available in the market today have been crafted based on consumer insights developed through extensive market research. Apart from the current portfolio of products, several new and innovative products are under development in ITC's state-of-the-art Product Development facility located at Bengaluru. The Foods business is today represented in 4 categories in the market. These are:
Ready To Eat Foods Staples Confectionery Snack Foods In order to assure consumers of the highest standards of food safety and hygiene,
ITC is engaged in assisting outsourced manufacturers in implementing world-class hygiene standards through HACCP certification. The unwavering commitment to internationally benchmarked quality standards enabled ITC to rapidly gain market standing in all its 6 brands:

Kitchens of India Aashirvaad Sunfeast Mint-o Candyman Bingo!
Lifestyle Retailing
ITCs Lifestyle Retailing Business Division has established a nationwide retailing presence through its Wills Lifestyle chain of exclusive specialty stores. Wills Lifestyle, as a fashion destination, offers a tempting choice of Wills Classic work wear, Wills Sport relaxed wear, Wills Clublife evening wear & fashion accessories, Essenza Di Wills an exclusive range of fine fragrances and bath & body care products for men and women and Fiama Di Wills a range of premium shampoos and shower gels. Wills Lifestyle has also introduced Wills Signature designer wear, created by the leading fashion designers of the country. With a distinctive presence across segments at the premium end, ITC has also established John Players as a brand that offers a complete fashion wardrobe to the youth of today. The launch of Miss Players with its range of trendy fashion wear for young women has been a successful addition to the youthful offering. With its brands, ITC is committed to build a dominant presence in the apparel market through a robust portfolio of offerings.
Wills Lifestyle has been established as a chain of exclusive specialty stores providing the Indian consumer a truly 'International Shopping Experience' through worldclass ambience, customer facilitation and clearly differentiated product presentation. Wills Lifestyle complements the range of premium apparel with a tempting choice of fashion accessories. Wills Sport, fashionable relaxed wear for men and women. Wills Classic work wear is positioned as the brand for new age leaders, who are changing the rules of business and encouraging a dynamic culture of enterprise, innovation and teamwork. ITC forayed into the youth fashion segment with the launch of John Players in December 2002 and is committed to be the No. 1 fashion brand for the youth. John Players offers complete and vibrant wardrobes of Casual wear, Party wear, Work wears, Denims, Outer wear and Suits & Jackets, incorporating the most contemporary trends, an exciting mix of colors, playful styling, trendy textures and comfortable fits. The launch of Miss Players has added to ITCs youthful portfolio. The range which spans trendy tops, funky denims, smart trousers and stylish dresses along with a whole range of cool fashion accessories has been designed keeping in mind the tastes of the young Indian woman.
Education and stationary products

ITC made its entry into the stationery business in 2002 with its premium range of notebooks, followed in the year 2003 with the more popular range to augment its offering. ITC's stationary Brands are marketed as "Classmate" and "Paperkraft", with Classmate addressing the needs of school goers and Paperkraft targeted towards college students and executives. The Paperkraft range consists of premium stationery with a wide variety for executives to choose from. The assortment consists of notepads & multi subject notebooks in hard, soft covers & multiple binding formats including spirals, wiros etc.
Classmate - India's largest National brand, reaching 50,000 outlets across the country, has over 300 variants in its range which comprises notebooks, long books, practical books, drawing books, scrap books, reminder pads etc. A recent addition to the Classmate portfolio has been the Classmate Fun N Learn range of children books targeting pre school learners. The Business has launched Geometry Boxes for school students branded as Classmate Invento. The Mathematical Instruments Box comprises world-class precision compass, high quality plastic instruments coupled with interesting trivia and useful information. ITC also markets a range of Greeting Cards and Gifting products under the Brand "Expressions". The gifting portfolio includes autograph books, slam books, party invitations, letter pads, gift-wraps, pop up books & mini books. In recognition of its quality products & processes, the business has been awarded with ISO 9001:2000
Safety matches
ITCs range of Safety matches include popular brands like i Kno, Mangaldeep, Aim, Aim Mega and Aim Metro. With differentiated product features and innovative value additions, these brands effectively address the needs of different consumer segments. The Aim brand is the largest selling brand of Safety Matches in India. ITC also exports regular and premium safety matches brands to markets such as Middle East, Africa and the USA. The successful acquisition of Wimco Ltd. by Russell Credit Ltd.
Agarbattis (incense sticks)

The Company commenced marketing Agarbattis (incense sticks) sourced from small-scale and cottage units in 2003. This business leverages the core strengths of ITC in nation-wide distribution and marketing, brand building, supply chain management, manufacture of high quality paperboards and the creation of innovative packaging solutions to offer Indian consumers high quality Agarbattis. Mangaldeep Agarbattis are
available in a wide range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Durbar, Tarangini, Anushri, Ananth and Mogra. Mangaldeep Yantra is a special offering from ITC and this specially created fragrance evokes the ambience of a temple. The premium ranges from ITC; Mangaldeep Spriha has two offerings, Pratiti and Sarvatra and are specially hand rolled by Cottage Industries. Seven out of 10 Mangaldeep Agarbatti manufacturing units are ISO 9000 certified.
Packaging and printing:

The company has leadership position in cigarette and liquor packaging The company's much-talked about acquisition of Rollatainers didn't materialize and it was called off. The division attained Level-6 in the international Quality rating system from an international accreditation agency. It also got World Star award for excellence in packaging. The exports by the division increased by 20% yoy following technology upgradation at its manufacturing plants.
Specialty paper:
ITC operates a 33000 tpa plant at Tribeni, West Bengal, to manufacture specialty papers, mainly with the imported wood pulp. Besides captive consumption, ITC also exports cigarette-packaging paper to BAT subsidiaries in Africa and Central Asia. Margins in the business have been adversely affected with stiff price competition from domestic as well as imported products post reduction in import duty. ITC has been scouting for an international joint venture partner for upgrading technology in this business. The division received certification under ISO9001 quality standards and Gold Star award from Royal Society for Prevention of Accidents UK. The specialty paper division contributed Rs1bn to the total revenues during FY00 compared to Rs880.5mn in FY99. The company produced 16355 tons of specialty paper during the year. International business division, which is involved in handling exports from the company,
did exports of Rs3.2bn during FY00. The division exports agri-products to various countries across the globe. Recently the division has decided to set up e-choupals for shrimps and coffee. These e-choupals would provide up-to-date information regarding local and global weather and scientific practices followed at different places to farmers. The division has plans of setting up 300 such choupals across the country in current year. ITC also has a infotech division, which is being realigned to focus on e-commerce software solutions. The company plans to hive off its Infotech division into a separate subsidiary.
Earnings sensitivity factors: Excise duty changes on cigarettes New product launches: Rothmans international brand portfolio may be launched through ITC, as Rothmans has withdrawn proposal for 100% subsidiary post global merger with BAT. Leaf tobacco crop depends on weather conditions and has significant impact on raw material costs.
Export markets reduce dependence on domestic market. Exports are also affected by the domestic crop production. Paper/ paperboard margins depend on international paper and wood pulp prices as well as changes in custom duty rates. Excise duty exemption in northeastern states. Growing gray market for foreign branded cigarettes Success in new business ventures Returns from investments in hotel business
Financial Review of ITC Ltd

ITC Ltd posted a 16 per cent rise in gross income at Rs 6009 crore in the fourth quarter (Q4) of fiscal 2009-10 (against Rs 5279 crore in Q4 of fiscal 2008-09) with posttax profit up 14 per cent at Rs. 736 crore (from Rs 650 crore) after adjusting for income tax refunds. For the full year 2007-08, ITC gross turnover rose to Rs.21966 crore (from Rs 19636 crore in 2006-07) while profit before tax rose to Rs 4571 crore (from Rs 3926 crore) and profit after tax for 2007-08 to Rs 3120 crore (from Rs 2699 crore). Cigarettes, reeling under a higher taxation regime, reported Q4 net sales of Rs 3583 crore (Rs3294 crore in Q4 of 2006-07) with segment gross profit at Rs 870 crore for Q4 (against Rs 741 crore).For the full year 2007-08, gross sales from the cigarettes business was Rs13825 crore (from Rs 12833 crore in 2006-07) while the segment gross profit from the cigarettes business was Rs 3634 crore (from Rs 3172 crore in 2006-07).
ITC - Financial Snapshot

(Rs. 1 crore = Rs. 10 million) Segment Revenues 2007-2008 1. Segment Revenue a) FMCG - Cigarettes - Gross - Net - Others Gross - Net Total FMCG Gross - Net b) Hotels Gross - Net c) Agri Business Gross - Net d) Paperboards, Paper & Packaging - Gross - Net Total Gross - Net Less : Inter-segment revenue - Gross - Net Gross sales / Income from operations Net sales / Income from operations 2. Segment Results a) FMCG Cigarettes - Others Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Profit Before Tax Provision for Taxation Profit After Tax 3. Capital Employed a) FMCG - Cigarettes - Others Year ended 31.03.2011 (Audited) 13825.60 6634.98 2511.05 2509.57 16336.65 9144.55 1100.20 1012.10 3868.44 3868.44 2364.33 2157.94 23669.62 16183.03 2313.68 2235.50 21355.94 13947.53 3634.04 (263.52) 3370.52 410.77 129.19 453.14 4363.62 4571.77 1451.67 3120.10 2314.64 1826.66
Total FMCG b) Hotels c) Agri Business d) Paperboards, Paper & Packaging Total Segment Capital Employed
4141.30 1865.32 1468.97 3264.18 10739.77
Operating results of ITC Ltd.

Year Ending 31st March Gross Income Excise Duties etc. Net Income Cost of Sales PBDIT PBDT PBIT PBT Tax Profit after tax (Before exceptional items) Exceptional Items (Net Of Tax) Profit after taxation Dividends Retained Profits 2005 8069.37 4133.89 3935.48 2475.45 1460.03 1347.48 1341.50 1228.95 436.51 792.44 792.44 224.55 567.89 2008 13585.39 5710.13 7875.26 4846.89 4846.89 2985.94 2715.50 2673.07 836.00 1837.07 354.33 2191.40 881.70 1309.70 2011 21966.84 7408.41 14558.43 9543.59 5014.84 5010.23 4576.38 4571.77 1451.67 3120.10 3120.10 1543.18 1576.92
Gross incomes Comparison
Comparison between non-cigarette of different year of ITC Ltd.
Profit trends of ITC Ltd.
MAJOR FACTORS INFLUNCING BUYING BEHAVIOUR CULTURAL

Social Buyer Reference group Family Roles and status Age Occupation Economic Lifestyle Personality Motivation Perception Learning Beliefs Culture Subculture Social class
PERSONAL
PHYCHOLOGICAL
OTHER FACTOR
ECONOMIC FACTOR The economic factor determines the demand and supply of the brands. it can be said that people from any income group can readily have an access to the product and this determines a good for it. CULTURAL FACTOR India market has opened up for long and the effect of liberalization can be seen in the culture of the country too. People are opening up to new national product as which were once not even spelled of in the country. Moreover the desi product with an international name such as slice is very of a know substance in the country and is highly liked. PERSONAL FACTOR Customers are highly drive to a product by virtue of personal reasons. look for is a construction this way it has been quite a successful product. PSYCHOLOGICAL FACTOR The slice seals off due to same Psychological factor. People construction it sometimes feel that its different from the rest and distinct among the crowd. This helps the craze grow for the brand and its products
RESEARCH METHODOLOGY
RESEARCH METHODOLOGY
Marketing Research is the backbone of marketing. The objective of my research is to study the consumer perception about Cigarette product of ITC in Indian consumer durable industry. The nature of this research is exploratory research. Its goal to shed light on the real nature of the problem and to suggest possible selection and to suggest possible selection and it involves number of steps. Methodology The research is exploratory in nature and the approach was very flexible and judgmental in order to provide opportunity for considering different aspects of the problem. The enabled the respondents to raise issues and questions which are considered to our projects. Exploratory research In the case of exploratory research, the focus is on the discovery of ideas. Objective of the study is to generate new ideas; respondents have been given sufficient freedom to express themselves. We as the interviewer allowed the participants to discuss the issue fully when we feel that some important aspects in the discussion are likely to be left out by the respondent. Define the Problem & Research Objective: Management must define a problem in broader way. Because it is said that that the well defined problem is half solved and the objective of this research is to study the consumer perception about ITC Cigarette products in Indian consumer durable industry.
Developing the Research Plan The second stage of marketing research is to develop the most efficient plan for gathering the needed information. Research plan development includes decision on the data sources, Research Approaches, Research Instruments, and Sampling Plans & Contact Methods.
Size and Selection of Sample

Sample size The size of sample as specified by the project guide is taken for the study. Large samples give more reliable results than small sample. 500 respondents have been interviewed for the data collection. Selection of sample There are two types of sampling methods: Probability sampling method Non-Probability sampling method Probability sampling has been used in this study. Again this method is divided in different parts. Probability sampling method
Random Sampling
Multi-stage Sampling
Cluster Sampling
Systemic Sampling
Probability sampling has been project. Persons were interviewed, as they were available at the time. This sampling is also called accidental sampling, as the respondents in the sample are included merely because of their presence on the spot.
Sampling Plan: Primary data is collected from MEERUT and sub urban areas and respondents are contacted directly along with the questionnaire. Sample Procedure: To obtain representative samples. Simple random sampling has been used that comes under the probability sampling. Contact Method: Once the sampling plan has been determined the marketing research must decide how the subject should be contacted. Personal interviews are used for the collection of the data.
Methods of data collection

In this research study process, after the objective of study has been finalized, the research problem and the design have been chalked out; the next important step is of Data Collection. This applies for Primary Data as secondary data. Primary data Primary data were collected by conducting personal interviews of retailers in specified areas in the territory (questionnaire enclosed). Survey of the outlets and personal interviews of consumers: This method has been chosen because of the following reasons: a. Relevant information could be gathered. b. Economical c. Simple to be carried out d. Conformance to respondents way to thinking e. Time involved is also not much This technique is preferred as it is: Economical More informative non-responses are low Spontaneous relations-which are more realistic lots of supplementary information, comes up.
Secondary data Secondary data was collected from the websites of ITC Ltd, and through the press release, and it was used in designing of the Questionnaire to analyse the market size of cigarette brand of ITC Ltd. Figures are also collected from annual reports of ITC Ltd. Magazines, Catalogue, Newspapers, Product Profile & Internet are also used to gather the secondary data. Research approaches Primary data can be collected into five ways observations, focus groups, survey, behavioral data & experiments and here I have used survey research. Survey Research Surveys are best suited for exploratory research ITC take survey & resurveyed to learn about peoples, knowledge, beliefs, preference & satisfaction & to measure these magnitudes in the general population.
TYPE OF RESEARCH:
The basic type of research are as follows:
1.
Descriptive vs
Analytical: Descriptive research includes surveys
and
finding enquires of different kinds. The MAJOR purpose of descriptive research is description of the state of affairs as it exits at present. In social science and business research we quite often use the term ex post facto research for descriptive research studies.
In analytical research on the other hand the researchers has to use facts or information already available, and analyze to make a critical evaluation of the material.
2.
Applied vs Fundamental:Research can either be applied (or action) research or fundamental (or basic or pure) research. Applied reseachaims at finding a solution for an immediate problem facing a society or an industrial or business organization , whereas fundamental research is mainly concerned with generation and with the formulation of a theory. Gathering knowledge for knowledge sake is termed as a pure or basic research.
3.
Quantitative vs qualitative: Quantitative research is based on the measurement of quantity or amount. It is applicable to phenomena that can be expressed in terms of quantity. Qualitative research on the other hand is concerned with qualitative Phenomenon i.e., phenomenon related to or involving quality or kind.
4.
Conceptual vs Empirical: Conceptual research is that related to some abstract idea(s) or theory. It generally used by philosophers and thinkers to develop new ideas new concept or to reinterpret existing ones.
On the other hand, empirical research relies on experience or observation alone often without due to regard for system and theory.
RESEARCH PROCESS:
The various step provides a useful guide line regarding the research process: 1. Formulating the research problem. 2. Extensive literature survey. 3. Developing the hypothesis. 4. Preparing the research design. 5. Determining sample design. 6. Collecting of data. 7. Execution of project 8. Analysis of data. 9. Hypothesis of testing. 10.Generalization and interpretation 11. Preparation of the result, i.e., formal write up of conclusion reached.
CUSTOMER SATISFACTION
Satisfaction or dissatisfaction has been called an episodic measure in that it relates to the quality of ITC Ltd. By contrast, cement quality is a global evaluation of all past service experiences Research has found that customer, perceived evaluation of cement quality has an impact on their level of satisfaction. Therefore, cement quality evaluation is an antecedent to customer satisfaction In case of quality failure the level of customer dissatisfaction will be determined by how and where customers attribute the cause of the failure or poor quality. The process of deciding the cause of a quality failure is called attribution theory. Controllable and uncontrollable factors are situational in nature and will vary from one consumer to another.
Managing Consumer Expectations (During Post Purchase Phase) Managing consumer expectations does not after the service is performed. Service firms have three strategies they can use after the service has been completed. First, companies should communicate with customers immediately after the service is completed to see if expectations were met. Second, firms can use a follow-up program, such an evaluation survey sent to the customer through the personal meting or phone call.
Third, companies should have a procedure for dealing with dissatisfied customers that will assist in managing future expectations.
Upon the completion of a service, service personnel should talk with customers about the service. If customer expectations have been met, the probability of the customer coming back is greatly increased. Some services are difficult for customers to evaluate immediately, so follow up calls are an effective way to manage customer expectations.
My project forms the part of such services sells services.

If customer expectations have not been met, the service provided was below the adequate serves level and outside of the tolerance zone.
Tools and Techniques used

Percentage To calculate the percentage of the respondents attitude for a particular question, firstly I made the tally tables, to find number respondents having similar attitude, and then I have divided that number of respondents with the total number of respondents and multiplied it with hundred. Chi Square The major objective of the study was to analyse the market share and customer satisfaction. For this purpose I used chi square method taken null hypothesis, as
customers are not satisfied with the product. Null hypothesis is taken as the customers are not satisfied with the product. Level of significance is 5%. Research Instrument Marketing Researcher has choice between two main research instruments in collecting primary data Questionnaire & Mechanical device. Questionnaire has been as a research instrument. Questionnaire: Questionnaire contains 09 questions and presented to know about the views of consumers. In preparing this questionnaire open ended as well as close-ended questions have been usedThe questionnaire measure the responses using parameter like Awareness of Brand/product. Factors affecting while buying the cigarette Consumption of cigarette of different brands. Determinant factor for the consumption of cigarette of ITC Ltd. Satisfaction level of consumer at different parameters. Behavior of retailers while selling the product.
Analyzing the information The step in the marketing research process is to analyse the data and extract the findings from the collected data. Findings of the study In the later segment of the report findings are mentioned that are relevant to make the major marketing decisions by the management.
SWOT ANALYSIS
SWOT ANALYSIS
Organization performs SWOT (Strength, Weakness, Opportunity, Threats) analysis to identify and evaluate their competitive position. STREGTHS: The company has excellent distribution system. The company has built a strong image among the customers. The company experiences excellent Brand loyalty for its Products from the customers. The company has made its Packaging attractive which lures the customers and consequently the products are favorite among the customers. WEAKNESSES Some products have high prices as compared to the other products OF Godfrey Philips India Ltd. & Gallaher Group. The company branches are not spread through out the region; as a result load of the work at the regional offices are tremendous. The company pays less attention towards advertisement as against its competitors. The brewery of the company is old and not up to expectation of modern times. OPPORTUNITIES India has a vast potential market, which the company can get hold up. The company can prove to be major threats for its competitors if it increases its marketing efforts. Tobacco market in India is at a growing stage. ITC Ltd. should concentrate on the premium segment market.
THREATS The major threat that company faces is from its competitors who are introducing products with good features like soft filter and good quality tobacco in the cigarette at lower cost backed by aggressive promotional schemes to attract buyer. The arrival of the MNC is a major serious threat for the company.
DATA ANALYSIS
INTERPRETATION AND ANALYSIS OF DATA

The questionnaire was designed to find out the perception of consumer towards Cigarette of ITC Ltd and to determine the market share of Cigarette of ITC Ltd. The sample size taken for this questionnaire was 500. The area of survey included Meerut and suburban area. The analysis of each question of the questionnaire is as follows:
Q1. Do you smoke? This question was asked to find out the percentage of smokers among the surveyed population. The sample size for the survey was 500. Various responses from the respondents are summarized in the following table:
Response Yes No Total
No of respondents 165 335 500
We can further analyze it with the help of a pie chart that is given on the next page.
So we can see from the above figure that among the population surveyed 149 respondents are smokers that constitute a major proportion (approx.33 %) of the category and 67% of the respondents are non-smokers.
Q2. What do you smoke? This question was asked so that consumers of cigarette can be sorted out from the respondents. Responses are summarized in the following table
Product Cigarette Bidi Both Total
No. of Respondents 71 68 26 165
We can also find the percentage number of cigarette consumers with the help of following pie chart.
No. of Respondents
Both 16% Cigarette 43% Cigarette Bidi Both Bidi 41%
41.21% of the respondents consume Bidi, 43.03% of the respondents consume cigarette and 15.76% of the respondents consume both Cigarette and Bidi.
Q3. If cigarette then, what are most determinates factors affect you while buying cigarette? This question was asked to find out what are the factors that affect a consumer buying behaviour while purchasing a cigarette. Do they emphasize over the brand/company, price, taste or anything else. Features Brand/Company Price Taste All of the above Any other Total No. of Respondents 43 12 44 12 8 71
Factors Determining Purchase of Cigartte

50 45 40 35 30 25 20 15 10 5 0 No. of Respondents 43 44
12
12
Pr ic e
Ta st e
pa ny
Br an d/ Co m
ab ov e
Names of Factors
Out of 71 cigarette consumers 60.56 % said that they emphasize on the brand while 61.97 % said that they prefer the taste and 16.90 % focus on the all given factors and minority of 11.26 % go for the any other factor.
Al lo
ft he
An y
ot he r
Q4. Which brand do you prefer most among the following? This question was asked to find out the percentage of ITC cigarette consumers. The responses from the various respondents are given in the following table: Brands ITC VTC GST Godfrey Phillips Dont know Total No. of Respondents 50 5 4 7 5 71
Out of 71 cigarette consumers 70 % prefer cigarette of ITC while 7 %, 6 %, 10 % like the cigarette of VTC, GST and Godfrey Phillips respectively.
Q5. Which product of ITC you like most? This question was asked to find out the most popular product of ITC Ltd. Four different options were given, Gold Flake, Wills, Classic and India Kings. The responses of the respondents are given in the following table. Brand Gold Flake Wills Classic India Kings Any Other No. of Respondents 19 15 7 6 3
The graphical representation of the above table will give a clearer view about the Brand Preference among ITC Cigarette consumers.
Brand Preference among ITC Cigarette Consumers
3 19 Gold Flake Wills Classic
7 15
India Kings Any Other
From the above pie chart it is clear that Gold Flake and Wills are the most popular brand of ITC Ltd. with a consumer base of 68% of the ITC cigarette consumers.14% of the respondents prefers Classic and 12% of the respondents prefer India Kings. While 6% of the respondents prefer any other brand of ITC Ltd.
Q6. Please rate ITCs product on the following parameters: This question was asked to find out the rating of the ITC cigarette on the given parameters and to find out that which factors satisfies the consumers most. No. Of Respondents Very Good Average Good Quality Packaging Various Varieties of product Price Availability in retail store Awareness about the Product Taste
Features
Below Average
Poor
13 14 15 11 8 7 10
19 23 17 12 22 15 22
12 9 4 14 11 8 9
4 4 9 12 6 16 6
2 0 5 1 3 4 3
To analyze the above table Likert scale technique has been used. In this we will give points to various scales, which have been used to rate the different statements. The points are given are as follows: Very Good Good Average Below Average Poor : : : : : +2 +1 0 -1 -2
After this we multiply it with the number of respondents for a particular statement in each scale to get the score for that particular statement. Like this score for each statement can be obtained. Thus the score for a particular statement will range from +100 to 100 with the average score being 0. if the score falls-
Between 100 to 75 it will be considered as Poor. Between 75 to 25 it will be considered as Below Average. Between 25 to +25 it will be considered as Average. Between +25 to +75 it will be considered as Good. Between +75 to +100 it will be considered as Very Good. By using all these things the analysis of all the statements in the question is as follows: Quality of the product+37 points The score of this statement falls between +25 to +75 that means it is good. According to the respondents Quality of the product is good. Packaging of the product: + 47 points The score of this statement falls between +25 to +75 that means it is good. According to the respondents Packaging of the product is good. Various Varieties of product: +28 The score of this statement falls between +25 to +75 that means it is good. According to the respondents Various Varieties of product is good. Price of the product: +20 The score of this statement falls between 25 to +25 that means it is average. However it has positive score but the price of the product is average.
Availability in retail store: +26 The score of this statement falls between +25 to +75 that means it is Good.
Awareness about the Product: +5 The score of this statement falls between 25 to +25 that mean it is average. According to the respondents it is considered that Awareness about the Product is just satisfactory.
Taste of the product: +30 The score of this statement fall between +25 to +75 that means it is good. According to the respondents Taste of the product can be considered as Good. All the factors given in this question can analyze the various features of ITC products. By the analysis it is concluded that Quality of the ITC cigarette has been given +37 points which indicates that consumers are satisfied with the quality of ITC cigarette, packaging of the ITC cigarette is given +47 points that indicates that packaging is also good. Various varieties of the products are given +28 points that are a good performance. It shows consumers are quite happy with the varieties provided by ITC. Pricing of the products is given +20 points that indicate average pricing of ITC cigarettes. Availability of ITC cigarettes in retail stores is given 26 points that shows that retailing of ITC products is good and consumers get their favorite brands from retailers. Awareness about the products is not satisfactory and it has been given +5 points. Taste of the ITC products is given +30 points and it shows consumer satisfaction towards ITC cigarettes. For the further analysis of this question we can draw the column charts. The representation of charts is as follows:
QUALITYWISE PERFORMANCE OF ITC CIGARETTE 20 18 16 14 12 10 8 6 4 2 0 19 13
No. of Respondents
12
4 2
Very Good
Good
Average Rating
Below Average
Poor
From the above column chart it is clear that out of 50 respondents 32 (64%) rated the quality of ITC Cigarettes as either very good or good. A minority of respondents 6 (12%) is of the view that ITC cigarettes are of below average or of poor quality. Rest of 12 (24%) respondents think the quality of ITC Cigarette as average
Packaging Base performance of ITC Cigarette

25 No. of Respondents 20 15 10 5 0 Very Good Good Average Rating Below Average 14 9 4 0 Poor 23
From the above column chart it is clear that out of 50 respondents 37 (74%) rated the packaging of ITC Cigarettes as either very good or good. A minority of respondents 4 (8%) is of the view that packaging of ITC cigarettes is below average or of poor. Rest of 9 (18%) respondents think the packaging of ITC Cigarette as average
Variety Base Performance of ITC Cigarette

18 16 14 12 10 8 6 4 2 0 17 15
No. of Respondents
9 4 5
Very Good
Good
Average Rating
Below Average
Poor
From the above column chart it is clear that out of 50 respondents 32 (64%) thinks that ITC has presented sufficient varieties of the cigarette and they rated the variety dimension of ITC Cigarettes as either very good or good. A minority of respondents 14 (28%) is of the view that ITC has not presented sufficient varieties of the cigarette and they rated the variety dimension of ITC cigarettes is below average or of poor. Rest of 4 (8%) respondents think the variety of ITC Cigarettes as average
Price Base Performance Of ITC Cigarette

16 14 12 10 8 6 4 2 0 14 11 12 12
No. of Respondents
1 Very Good Good Average Rating Below Average Poor
11(22%) of the respondents said price of ITC cigarettes is very good, 12(24%) said it is good, 14(28%) said average, 12(24%) said its below average and only 1(2%) respondent said it is poor. If I consider the respondents who gave the rating average, below average and poor, they are not satisfied with the prices and the respondents who have given rating very good and good considered as satisfied with it. Now I can say that 23(46%) consumers are satisfied and 27(54%) are not satisfied. Overall it can be considered that price of ITC cigarettes are acceptable.
Availability Base Performance of ITC Cigarette

25 No. of Respondents 20 15 10 5 0 Very Good Good Average Rating Below Average Poor 8 11 6 3 22
8(16%) of the respondents said availability of ITC cigarettes is very good, 22(44%) said it is good, 11(22%) said average, 6(12%) said its below average and only 3(6%) respondent said it is poor. If I consider the respondents who gave the rating average, below average and poor, they are not satisfied with the availability and the respondents who have given rating very good and good considered as satisfied with it. We can say that 30(60%) consumers are satisfied and 20(40%) are not satisfied. Overall it can be considered that ITC cigarettes are easily available.
Awareness Base Performance of ITC Cigarette

18 16 14 12 10 8 6 4 2 0 15 16
No. of Respondents
8 4
Very Good
Good
Average Rating
Below Average
Poor
From the above column chart it is clear that out of 50 respondents 22 (44%) are well aware about the ITC cigarette and they rated the awareness of ITC is either very good or good. 20 (40%) of respondents is of the view that awareness of ITC cigarette is below average or of poor. Rest of 8(16%) respondents rated the awareness of ITC Cigarettes as average
Taste Base Performance Of ITC Cigarette

25 No. of Respondents 20 15 10 5 0 Very Good Good Average Rating Below Average Poor 10 9 6 3 22
From the above column chart it is clear that out of 50 respondents 32 (64%) thinks that the taste of ITC cigarette is either very good or good. A minority of respondents 9 (18%) is of the view that taste of ITC cigarette is below average or of poor. Rest of respondents rated the variety of ITC Cigarettes as average The next fact to analyze is Whether the consumers are satisfied with ITC Cigarettes or not. We can clear above question with the help of Chi Square. For the Chi Square we can take null hypothesis, as consumers are not satisfied with the ITC Products.
Features
No. of Respondents Satisfied Dissatisfied 18 13 18 27 20 28 18 142 Total 50 50 50 50 50 50 50 350
Quality Packaging Various Varieties of product Price Availability in retail store Awareness about the Product Taste of the product Total For satisfied consumers E (32)=50*208/350 =29.71
32 37 32 23 30 22 32 208
The expected value for all satisfied consumers will be 29.71.
For dissatisfied consumers E (18)=50*142/350 =20.29 Similarly expected value will be 20.29 for all the dissatisfied consumers. Computation of 2 Expected Frequency 29.71 29.71 29.71 29.71 29.71 29.71 29.71 20.29 20.29 20.29 20.29 20.29 20.29 20.29 O-E 2.29 7.29 2.29 -6.71 0.29 -7.71 2.29 -2.29 -7.29 -2.29 6.71 -0.29 7.71 -2.29 (O-E) 2 5.2441 53.1441 5.2441 45.0241 0.0841 59.4441 5.2441 5.2441 53.1441 5.2441 45.0241 0.0841 59.4441 5.2441 (O-E) 2/E 0.176510 1.788761 0.176510 1.515453 0.002831 2.000811 0.176510 0.258457 2.619226 0.258457 2.219029 0.004145 2.929724 0.258457 14.208370
Observed Frequency 32 37 32 23 30 22 32 18 13 18 27 20 28 18 Total
2 = [(O-E) 2]
= 14.208370 Degree of freedom = (7-1)*(2-1) =6*1 =6 At 5% level of significance 2 =14.067 We get above value from the chi square distribution table.
Decision rule
Since calculated value of 2 is greater than tabulated value, it is significant at 5% level of significance. Hence the null hypothesis is rejected and it is concluded that consumers are satisfied with the products.
Q7. Are you satisfied with ITCs cigarette? In response to the above question the following numbers were found out of 50 respondents are: -
Response
Yes No Indifferent
No of respondents
43 5 2
Total
50
Out of total 5o consumers 43 respondents said they are satisfied with ITC cigarettes while 5 respondents said they are not satisfied with ITC cigarettes and 2 the respondents were indifferent.
Q8. Does the retailer force you to purchase other brands in the absence of demanded brands? In response to the above question the following responses were found out of 50 respondents: Out of 50 consumers 7 said that retailer forces them to purchase other brands in the absence of demanded brands and 43 said that retailer never forces them to purchase any other brands in the absence of demanded brands.
Q9. Do you want to give any suggestion to ITC for their product? If yes, then please Suggestions from the consumers are included in the recommendation section of the report.
FINDINGS
FINDINGS
From the analysis and interpretation of data we can find the following facts from the allocated are for the study: Only 33% of the total respondents smoke in the allocated area of the study. 43 % of the smokers consume cigarette and 41% consume Bidi, we can say that the Bidi producers are the main competitors for the cigarette producers in the Indian cigarette market. A majority of the cigarette consumers agreed to the fact that most determent factor that affects them while buying cigarette is taste (62%) and brand (60%) and cigarette of ITC has a good taste. Analysis of the questionnaire suggests that ITC has a market share of 70.42 % in the cigarette market, while the VTC, GST and Godfrey Phillips have captured 7.04 %, 5.63 %, and 9.85 % market respectively while 7 % respondents dont know about the company name. ITC has the market leadership. Gold Flake and Wills are the most popular brand of ITC Ltd. with a consumer base of 68% of the ITC cigarette consumers. Powerful brands across segments and leadership in all segments - geographic & price and exciting long-term growth potential. Quality of the cigarette, packaging and varieties is good while consumers say that the price is average. Availability and taste of the ITC cigarette is said to be good by the respondents. Future growth depends on relative prices of product and growth in per capita income and moderation in taxes.
On the basis of Chi Square we can say that the consumers of ITC product are satisfied. 86 % of the ITC cigarette consumers are satisfied with the product when 10% found to be unsatisfied and 4% are indifferent. 14% said that the retailer forces them to purchase another brand in the absence of demanded brand.
RECOMMENDATIONS
RECOMMENDATIONS
The following are Recommendations for the company to improve itself which the study has been shown: ITC should focus on the sales promotion as competitors are offering lower prices for the similar type of the products. ITC should revise the pricing of the cigarettes. The behavioral analysis of the retailers and customers shows that most of the customers give the preference to the price of a product, then performance of the products at most of the times. There are very less people who prefer both the options. So it should be more and more price oriented. We can see that the most important factor, which is considered by the retailers to keep the products of a company, is profit margin. After that it is followed by brand/company, price of product, various schemes and performance respectively. Retailers prefer that product, which gives more profit margins so it should increase profit margin for retailers. ITC should focus on surrogate advertising as awareness of ITCs cigarettes is less among the customers, as direct advertising of tobacco products is banned as per Indian government rules. Incentive schemes for Retailers should be started by ITC Ltd to increase the sale, if they loose the confidence of the Retailers, the company can loose the market share. The company Representative should regularly visit to the Retailers to solve their problems, and to tell them about new products and schemes. This would help them to know about the consumer behaviour, their taste and preferences.
Schemes provided by the company are also an important factor for the retailers. Schemes distribution of the Redistribution Stockiest is not so much accepted by the retailers, so it should provide proper scheme distribution to keep them happy. The company should also offer some Gifts and scratch coupon schemes for the consumers.
CONCLUSION
CONCLUSION
The study that has undertaken concludes that the product of ITC is delightful product for the consumers. Thus from the analysis and interpretation of data we can conclude the following things. The sale of ITC is good but we should say it satisfactory, as it is the first entrant in the Indian market.
Conclusion is as follows:
banned.
The awareness of ITCs cigarettes is less to the consumer due to advertisement
Taste of Cigarette is the factor that attracts the consumers most while they go for smoking. Extensive distribution network o Over 900 wholesale dealers serving more than 1 million retail outlets Consumers prefer filtered cigarette to the non-filtered. Gold Flake & Wills are more preferred by the consumers. No attractive scheme is offered by the ITC to the retailers and consumers.
LIMITATIONS
LIMITATIONS
In spite of making all my efforts to make the dissertation a perfect one there are certain limitations in the study, which are felt while conducting the survey. As the study is an exploratory one designed to find new hypothesis, readers are not suggested to conclude the result. The study suffers from the basic limitations of the possibilities of difference between what is recorded and what is true. In addition, some limitation regarding of the study are mentioned. The sample size is very less and therefore the test that could be done on large population cannot be done. The findings of the survey are based on the subjective opinion of the respondents and there is no way of assessing the truth of the statements. There is some respondents bias that cannot be removed. Absence of seriousness of the respondent while filling the questionnaire. Even after assuring the retailers that the survey was purely for academic purpose, they were reluctant to share information. No competitors are interviewed and hence there is a problem of comparing the brand with others thoroughly. Besides this no help has been taken from any secondary data of this type in this regard Some retailers were not friendly and gave distorted information.
Certain questions, which are not properly, respond by the respondent. And like any other research the limitation of personal bias of respondents limit the scope of the study.
BIBLIOGRAPHY
BIBLIOGRAPHY
Books: Kotler, Philip, Kotler Armstrong, Beri G.C., Bhattacharya D.K., Gupta S.C., B.C. Chabbra T.N. Marketing Management: Principles of Marketing: Marketing Research: Research Methodology: Fundamental of Statistics: Marketing Research Marketing Management Pearson Publication, Pearson Education, Tata McGraw Hill, Excel Books, Himalaya Publishing House
Magazines: Business World Business Today Tobacco or health: A global status report. WHO publication
Websites: www.itcportal.com www.itcltd.com www.itcwelcomgroup.in www.welcomeheritagehotels.com www.fortunehotels.com
QUESTIONNAIRE
QUESTIONNAIRE
1. Do you smoke? Yes 2. What do you smoke? Bidi Cigarette Both No
3. If cigarette then, what are most determinates factors affect you while buying cigarette? Brand / Company Price of Product Taste All of the above Any other 4. Which brand do you prefer most among the following ITC Dont know VST GTC Godfrey Phillips
Any other (please specify)..
5. Which product of ITC you like most? Gold Flake India Kings Wills Classic
Other please specify.
6. Please rate ITCs product on the following parameters: Very good I) Quality Good Average Below Average Poor
II) Packaging
III) Various Varieties of product IV) Price V) Availability in retail store VI) Awareness about the Product VII) Taste
7. Are you satisfied with ITCs cigarette? Yes No Indifferent
8. Does the retailer force you to purchase other brands in the absence of demanded brands? Yes No
9. Do you want to give any suggestion to ITC for their product? If yes then Please.
Name: Gender: Occupation:

Comparative Research On Market Size of Cigarette Brand of IT

Încărcat de

Informații document

Descriere originală:

Titlu original

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

Comparative Research On Market Size of Cigarette Brand of IT

Încărcat de

Drepturi de autor:

Formate disponibile

Comparative Research on Market Size of Cigarette Brand of ITC Ltd.

Master of Business Administration 2009-11

INSTITUTE OF TECHNOLOGY AND MANAGEMENT