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Diversification Strategies Case Study

Case Title:

ITC: The Indian Tobacco Major's Diversification Strategies for Market Leadership

Publication Year : 2005

Authors: Krishna Kumar, Anitha Dilipan, Kannan R. Nitha Rajan, Susmita Nandi

Industry: Conglomerates


Case Code: DIS0006

Teaching Note: Not Available

Structured Assignment: Not Available

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ITC has transformed itself from a leading cigarette manufacturer to an umbrella group that offers a diversified product mix to enhance its brand image and reduce dependency on tobacco related products. It has forayed into the hospitality service industry and has become a major player in the hotels segment. Its position in the FMCG (fast moving consumer goods) business is also on a growth curve; especially its confectionery and biscuits which are slated to achieve the top ranks among its peers. It has made heavy investments to strengthen its IT (information technology) segment and to compete with the big players like Infosys and Wipro. Although the ITC group is marketing its image as an ideal corporate citizen and a company that takes its social responsibility seriously, it still earns 80% of revenues from selling cigarettes and other tobacco related products.

Pedagogical Objectives:

  • To highlight ITC's need to diversify its portfolio of product mix
  • To highlight the strategies adopted by ITC to maintain its position as one of India's leading companies
  • To discuss the future possibilities of strategic planning by ITC.

Keywords : ITC Ltd (ITC); Tobacco products industry; Market leader and market share; Fast moving consumer goods (FMCG); Diversification strategy; Segmentation strategy; Diversification Strategies Case Study; Customisation of products; Brand image enhancement; Hospitality industry; Product mix and positioning of products; ITC’s e-Choupal initiative; Branded foods and apparel; Supply chain management; Vertical integration; Information technology and ITC Infotech

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