It is Difficult to Grow Business Tobacco: Deveshwar

Source from:  hindu.com Kolkata (PTI) 08/01/2008

ITC Ltd Chairman Y C Deveshwar on wednesday said that owing to the restrictive regulatory environment it is difficult to make the tobacco business grow and for the same reason company has diversified into other new areas. Deveshwar said that cigarettes, the traditional product from ITC, were being taxed disproportionately at rates higher than other forms of tobacco consumption. "The cigarette business is operating in a restrictive regulatory regime," Deveshwar said. He said that there was need to "create other legs of growth for which ITC has ventured out in new areas like FMCG". The cigarette business was now contributing less than 50 per cent to the total turnover. Nearly 53 per cent of ITC's revenue was being contributed by non-cigarette business. At the company's 97th annual general meeting, Deveshwar said that in the last two years, the company had invested Rs 4,000 crore in fixed assets. He said that returns on these investments would not come immediately but over a period of time. ITC had diversified into areas like personal care products, lifestyle retailing, agri-business and branded packaged foods among others. Enditem