ITC sets sights higher for foods brand Aashirvaad3 min read . Updated: 07 Mar 2018, 01:45 AM IST
ITC sets goal of generating Rs10,000 crore from the Aashirvaad brand annually over five years
New Delhi: ITC Ltd has set its sights higher for Aashirvaad—the Kolkata-based cigarette-to-shampoo maker’s largest packaged food brand.
The company has set an internal target of generating Rs10,000 crore from Aashirvaad annually in five years.
For perspective, this means that in five years, ITC will generate what the country’s largest pure-play listed food company, Nestle India Ltd, notched up in calendar year 2017 sales (Rs10,135 crore), and more than the financial year 2017 revenue of biscuit maker Britannia Industries Ltd (Rs8,684 crore), by selling food products under Aashirvaad— a brand ITC created in May 2002 to sell atta, and later expanded to include spices, salt, ghee, instant mixes and ready-to-eat meals.
“At the retail level, Brand Aashirvaad’s current sales is around Rs4,200 crore. The brand has been growing at a compounded annual rate of 16-17% for the past few years. We hope to maintain the rate of growth, and the target is to cross the Rs10,000 crore mark," said Hemant Malik, divisional chief executive (foods), ITC.
To hit the Rs10,000 crore mark, according to Malik, Brand Aashirvaad will see a stream of product launches—backed by a micro-regional strategy for product innovation, distribution and communication targeting to get new sets of consumers.
Besides, the company is constantly working on reducing distance to market (from factory) to ensure freshness.
“We are launching ready-to-bake roti (Indian bread), with a five-day shelf life, later this year, hopefully by winter. We have already got the technology, and will soon start test marketing the product," Malik said. The ready-to-bake roti will require only a few minutes’ heating.
While ready-to-bake rotis are available in some global markets, ITC will be among the first companies to bring the product to India. UK-based East End Food sells a similar product in some parts of that country.
In India, Bengaluru-based iD Fresh Food India Pvt. Ltd and New Delhi-based Ready Roti India Pvt. Ltd, in which Mexican firm Grupo Bimbo acquired a 65% stake in May 2017, also tried selling ready-to-heat rotis but the products are hard to find.
“While we plan to price it for the masses, the product will initially be sold in metro cities that house the maximum number of double-income families, or people with little time for cooking. Also, this is a product that would compete with the restaurants that deliver to homes. We are trying to bring as much convenience as possible to make cooking easier," said Mailk.
ITC will also launch 7-8 variants of atta—produced with different blends of wheat—this year.
“These will be produced with different blends of wheat to make atta more suited to the taste buds of people in a particular region or state," said Malik. At present, the company has 4 variants.
The idea, according to Malik, is to go micro-regional and launch products that are relevant to, say, a particular town, state, community or a socioeconomic class.
“With 29 factories and our back-end of wheat procurement, we can have 29 blends or more," said Malik, adding that the company will also expand the atta and ready-to-make food portfolios to cater to people with lifestyle diseases such as diabetes or those suffering from malnutrition.
ITC’s focus on Aashirvaad is part of the company’s strategy to generate around Rs65,000 crore from packaged foods by 2030 to reach its target of Rs1 trillion revenue from non-cigarette packaged goods by that time, Mint reported on 21 September 2017.
Meanwhile, the company has been tackling the fallout of a set of videos shared on social media that allege that Aashirvaad atta has plastic in it.
“What is being shown as plastic in these mischievous videos is actually wheat protein which is a mandated component of atta by the FSSAI (Food Safety and Standards Authority of India). Protein is an integral part of any atta or wheat. This protein is what binds the atta. Without this protein, it is not possible to roll chappatis," said Malik.