Synergy between

businesses

Group 6
1913024 Vishwajeet Singh
1914002 Puneet Agarwal
1914028 Jain Nitesh Kumar
1914044 Neelabh Mayand
1914062 Ravi Shankar
Synergy Between Businesses

Tobacco / Agri- Paper /

Cigarette Business Packaging
 Tobacco / Cigarette Operational Relatedness
Marketing &
R&D Sourcing Manufacturing Packaging Sales
Agri-Business

Processing / Marketing &

R&D Sourcing Value Added Packaging Sales
Services
Paper / Packaging

Marketing &
R&D Sourcing Manufacturing Packaging Sales
Synergies
1. Sharing of Activities / Resources / Capabilities– Leveraging Institutional
Strengths

• Deep consumer insights

• Cutting-edge Research & Development
• Differentiated product development capacity
• Brand-building capability
• World-class manufacturing infrastructure
• Extensive rural linkages
• Efficient trade marketing and distribution network
• Dedicated human resources
• Common Corporate Services such as Finance, HR, IT, Strategy and Planning
 R&D Inbound Logistics Packaging Brand
Tobacco / Develop varieties of tobacco for Leaf Tobacco from farmers. Flip Top packs and cartons Strong brand signals
Cigarette cigarettes Tissue paper from paper for cigarettes. Export quality in leaf tobacco and
business packaging for leaf tobacco cigarette business
Agri-Business Fundamental and applied research Direct sourcing from Value added packaging of e-choupal and other
in agriculture. Soil Lab farmers fruits, coffee, marine sourcing activities in name
products, wheat flour of ITC. Strong brand in
export market. Improves
corporate image
Paper / Packaging Laboratory/research assistance to Buying Tree wood from Packaging for strong B2B Strong B2B brands in this
farmers. Develop tree breeding farmers brands space
science
Synergies
2. Market Power

• Core business (cigarettes) is an oligopoly

• ITC is able to utilize the buying power of its agri-business, which helps
it to compete in the tobacco/cigarette business and paper business
 Synergy

3. Financial Economies

ITC uses profits from its cash cow

cigarette business to invest and
grow its paper/packaging and
agri-businesses.
Almost 40% revenue and 80%
profit comes only from cigarette
business
Thank You