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Submitted to:-
Submitted by:-
CHIRANJEEV RAJ
CUJ/I/IMBA/2011/08
Centre for Business Administration
Central University of Jharkhand
Brambe, Ranchi.
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ABOUT ITC
ITC was incorporated on 24 August, 1910 under the name
Imperial Tobacco Company of India Limited. It was changed to
India Tobacco Company Ltd. in 1970. It was renamed as I.T.C.
Limited in 1974. Finally on 18 Sept 2001 it was rechristened as ITC
Limited.
Registered Office at Virginia House, 37 J.L. Nehru Road,
Kolkata.
MISSION OF ITC- ABD :To become the first choice supply chain partner for select
international customers accessing the finest agricultural and aqua
products.
ITC Agri-business operates in 2 areas:1. Leaf Tobacco by ILTD ITC Leaf tobacco Division which
is Indias largest buyer, processor, consumer and
exporter of cigarettes and tobaccos. It has emerged as a
major exporter of tobacco leaf.
2. Agri-commodities by ITC-ABD ITC Agro-Business
Division.
Where ITC-ABD does fits into ITC Family?
ITC has wide range of business activities:ITC Limited
FMCG
Hotels
Packaging
Paperboards &
Specialty Paper
Information
Technology
Agri-business
Leaf Tobacco
Agri- commodity
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HIERARCHY OF ITC-ABD:-
CEO- S. Shivkumar
COO- Rajnikant rai
VP Finance- Kuryan G. Stephanos
VP HR- L. Prabhakar
GM Channel & Head e-choupal- Shailesh Naik
ITC-ABD Headquarter - HYDERABAD, Andhra Pradesh.
PRODUCTS OF ITC-ABD:
Coffee
ITC - ABD
Food Grains
Feed Ingredients
Processed Fruits
Aqua Products
Nuts & Spices
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External
Environment
Micro
Environment
Macro
Environment
KOLKATA
HYDERABAD
HYDERABAD
HYDERABAD
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Japan
Thailand
Austria
London
Indonesia
Singapore
Switzerland
UAE
USA
Singapore
Singapore
USA
UK
Japan
Australia
Mexico
Germany
Muffadlal Enterprises -
Egypt
Nichiryo Limited -
Japan
Sino Japan Chemical Co Ltd The Coca Cola Trading Company Aziende Riunite Caffe SPA Bernhard Rothfos, GmbH Coca Cola International Trade Holland Coffee BV Olam International Limited Orimi Trade Limited Fuga Ag Hanawa Company Ltd Mitsubishi Showa Trading Co. Toyo Marine Gollucke Rothfos Gmbh -
Taiwan
USA
Milan
Germany
USA
The Netherlands
Singapore
Russia
Switzerland
Singapore
Japan
Japan
Japan
Germany
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PROCESSORS :Jagdeesh Marine Bhimavaram Sadaf Seafood Khalsa Overseas Dhulichand Narendrakumar
Exports Ltd
Aseptic Fruit Products(India)
Pvt Ltd
SAM Industries Bhaskar Agro Ingredients Travancore Coffee Curing
Works Kushalnagar Works SLN Coffee Curing Works Chamundi Coffee Curing Works Sargod Coffee Curing Works Anjanaya Sea Foods Sastha Spices & Oleresin Pvt ltd. Excel Foods Private Ltd -
Bhimavaram, AP
Kolkata
Madhya Pradesh
Karnal, Haryana
Krishnagi
Madhya Pradesh
Maharashtra
Kushalnagar
Kushalnagar
Kushalnagar
Chikmanglur
Chikmanglur
Nellore
Kalpeta
Hubli
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MACRO ENVIRONMENT:ANALYSIS
POLITICAL & LEGAL ENVIRONMENT:ITC-ABD faced challenges when it started its operations
under e-choupal from Govt of India relating to Agriculture
Produce Marketing Act (1937) which prohibited procurement
outside Mandis (rural vegetable/crops market). Later on Govt
offered to waive the mandi tax on produce procured through
e-choupal.
Now still, APMC (Agriculture Produce Marketing) poses a
challenge under which private market can be operated but
under ambit of Govt. So there is need to change agri-mktg
rules 1 to enhance the healthy competition in agriculture
market.
ITC-ABD gets inhibited due to APMC regulation and
Essential Commodities Act .2
Moreover the agriculturists, horticulturists and farm community
have been facing budget and financial constraints . Recently
there were lapses in implementation of debt waiver scheme 3.
This makes the farmers prone to high risk and poor budget
allocation. This is a major constraint for ITC-ABD as they get raw
materials due to procurement from farmers who are suppliers.
There are also legal blockages to business of ITC-ABD and to its
products. Few days back illegal cardamom imports 4 which
occurred in March will affect the Spice trading division of ITC-ABD
affecting farmers and resulting in dipping sales and illegal
substitutes.
. Change agri-marketing rules to help farmers gain. Business Line, Hyderabad. Retrieved November 5, 2013,
from http://www.thehindubusinessline.com/industry-and-economy/agri-biz/change-agri-marketing-rules/
2. Subsidies difficult to roll back. Business Line, Hyderabad .Retrieved November 19, 2013, from
http://www.thehindubusinessline.com/industry-and-economy/agri-biz/subsidies-difficult-to-roll-back/
3. (2013, March 6). Major Flaws in 52000 cr farm loan waiver scheme: CAG. Business Line, pp. 01.
4. (2013, march 4).Spices Board alerts Customs to act against illegal cardamom imports. Business Line, pp. 15.
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So firm needs to adapt and find short-term as well as longterm solutions to survive and grow in the political and legal
environment of the nation.
ECONOMIC ENVIRONMENT:This is the most critical and sine qua non factor for a firm to
cope-up and grow in the long run .
Long-term and recent economic situations will have a
significant impact upon ITC-ABD business operations.
ITC ABD processes food grains and spices which are packed in
hygienic jute bags under strict quality norms. But price hike by
Govt in jute 1 would raise the procurement price of jute as a
packing material for the customer.
ITC-ABD is known for delivering quality products on time due
to efficient vessel chartering skills and strong logistics which
helps to make it a competitive exporter. Govt is on the way to
partially deregulate port tariffs2 in which operators can fix higher
charges than the regulator ( government s body)
recommendation once a year. High tariff charge by the private
port developers would mean the price rise in the marine/vessel
freight transport cost for ITC-ABD.
In case of agriculture economic reforms, policy, budget, GDP
and purchasing power of the consumers will shape the firms
policy and decisions. Food Inflation due to fiscal deficit3 and
market factors is a prime cause and concern for ITC-ABD as it
would influence its procurement decision from suppliers and
trading in the rural market.
Moreover agriculture subsidies and food subsidies 4 provided
by Govt needs to be implemented properly but with a long-term
visionary policy which is lacking in India.
Proper crop insurance 5 is another problem for farmers in India
making them deprive of timely premiums. This poses a challenge
for ITC-ABD to be in constant sync with the economic changes in
India.
i
1. (2013, April 3). Govt hikes support price for jute. Business Line, pp. 16.
2. (2013, March) Govt partially deregulates port tariffs. Business Line, pp. 14.
3. (2013, April 4) Food inflation: Blame the fisc, not the private trade, Business Line, pp. 7.
4. Subsidies difficult to roll back. Business Line, Hyderabad .Retrieved November 19, 2013, from
http://www.thehindubusinessline.com/industry-and-economy/agri-biz/subsidies-difficult-to-roll-back/
5. Crop Insurance. Retrieved from http://www.tejas/iimb.ac.in/interviews/
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SOCIAL & CULTURAL ENVIRONMENT:Several social and cultural factors may affect the agri
business operations of ITC-ABD in India.
Agriculture in India faces a cultural efficiency problem in
case of agriculture productivity.
Societal distribution is unequal in case of agricultural trend
where rice and paddy are prevalent and other multi-crops
are ignored.
Agriculture in India being stigmatised as a low-profile occupation,
high risk and low returns. The next generation of farming
community has been on the verge of drift from agriculture to
service sector jobs. Their indigenous knowledge could not be
encashed properly so there is a need of well-managed agriculture
supported with latest and affordable technology.
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NATURAL ENVIRONMENT :-
1.
2.
3.
(2013, March 20). Egypt in talks to import wheat from India. Business Line, pp. 16.
(2013, March 13). Bengal spends least on food, household goods. Gujarat tops. Business Line, pp. 15.
(2013, March 16). Karnataka coffee belt gets good blossom showers. Business Line, pp. 16.
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