The foods division of ITC, a key diversification of the cigarettes and tobacco giant, expects to achieve a turnover of Rs 500 crore in four to five years by which time it hopes to break even.
The opportunity before the organised sector in the Indian foods business is astronomical as nearly half (48 per cent) of national household expenditure goes into foods but branded and packaged food has captured only 5-6 per cent of this expenditure.
Thus if the foods business of ITC delivers even a part of the promise it holds out, then ITC will have cracked the single biggest riddle before it: how to rely less on tobacco. This is the challenge before the new operation.
As with any new venture in the area of branded goods, the initial years will see a very large promotion budget, sometimes equal to or more than revenue. Over time this will settle down to 10 per cent of revenue. In the current year ITC
