ITC's Investment Plan May be Delayed by A Year

Source from:  The Hindu 08/02/2011

Cigarette-to-hotels conglomerate ITC's Rs.23,000-crore investment plan announced last year, may get delayed by an year or so, Chairman Y. C. Deveshwar said. He also said that plans were afoot to enter the diary business. Addressing a pressmeet after the company's 100th annual meeting, he said that the plan across all sectors of operations and with a five-year timeline was getting delayed. "We are not happy with the pace of execution. Multiplicity of approvals, and land issues were delaying projects, which may now take six years. But they are by and large on track," he said. In West Bengal too, its investment plans for a food processing unit has hit the land hurdle with the land earlier allotted, emerging to be a disputed one. He said that the company was keen to consolidate its presence in the FMCG business and was planning to get into dairy sector. "It (ITC) is in the umbrella of foods business and India is the world's largest milk producer. The first project has been set up in Munger in Bihar where an animal husbandry programme has been launched". The Chairman said that pastuerised milk, skimmed milk powder, cheese and chocolate were some of the items that were being explored. He said the company's non-tobacco business would become profitable within five years. "Five years from now this segment will earn handsome profits," he said. It may be mentioned that Mr. Deveshwar is currently on a second term as chairman, which expires five years later. To questions on his successor he said that the key criteria that would be looked for were leadership traits, values and vitality. "However, it is too early to talk of these things," he said. On investments in rival hotel companies he said that ITC had 'temporary liquidity' with funds to the tune of around Rs.5,000 crore. "This we deploy in many places for investment. But whenever we invest in equity, we put it in segments where we have domain knowledge. Our investments are confined to areas where we operate," he said. On the new takeover code which proposes to raise the threshold for triggering an open offer, he said that while this was yet to be notified, ITC would invest (in East India Hotels) further if the price was good or it might even sell if the price went up further. Enditem