News- Rural to royal, ITC's on fire without smoke

News- Rural to royal, ITC's on fire without smoke


THE ECONOMIC TIMES
16 APRIL 2007
New Delhi.

NEW DELHI: For six years there have been no fullstops in ITC. Now, fresh from upgrading a 30-year relationship with Starwood Hotels & Resorts from the Sheraton badge to the top-of-the-line Luxury Collection tag for his seven biggest metro hotels, ITC chairman YC Deveshwar can add another line to his three mantras “From seed to stomach”, “From fibre to fashion” and “From tree to text”. Dare we suggest, “From rural to royal?” or “ From livelihood to luxury”? Why not, since Mr Deveshwar is way down the road to transforming the tobacco-to-hotels major ITC into the country’s largest FMCG company.

From the cane-field to the catwalk, Mr Deveshwar’s strategy is to capture value across the entire spectrum of ITC’s businesses — tobacco, food, apparel, retail, hospitality, and perhaps even personal care in the future — and play across the income pyramid. “We want to be the champions of rural India. The future of the Indian markets is in its villages,” says Mr Deveshwar. So, even as ITC becomes a major player in the food business, it is following a strategy which is different from its competitors. “We want to have a potato chain, a wheat chain, and a corn chain. And we want to capture value throughout the chain,” he says.

While these are early days yet, the ITC chairman fresh into another 5-year term, appears satisfied with the progress that the company has made in the food business. “If we annualise last month’s sales of Sunfeast and Aashirvaad, each has already become a Rs 500-crore brand in a three-year period. The confectionary business, with Candyman and Minto, is also worth around Rs 200 crore, on this basis.” And then there’s the Rs 5,000 crore that ITC plans to pour into hotels, from budget Fortune Lodges in mofussil areas to the last word in luxury for its top metro properties.

Notwithstanding his enthusiasm for the non-cigarette FMCG business, when it comes to plans about entering the personal care segment, which ITC is said to be eyeing, Mr Deveshwar chooses to remain silent.

“I am not saying that we are entering the personal care segment, in addition to the premium range that we already have,” he says, but agrees that ITC’s goal of becoming India’s top FMCG company would probably not be realised until it enters this segment. Of course, it’s important not to be carried away with all the excitement around the non-cigarette FMCG business. While it’s true that the share of cigarettes in ITC’s total revenue has declined to less than 50%, cigarettes still account for 75-80% of the company’s pre-tax profits

online available at -

http://economictimes.indiatimes.com/News/News_By_Industry/Services/Hotels__Restaurants/Rural_to_royal_ITCs_on_fire_without_smoke/articleshow/1912880.cms

News - Shopkeepers in Indian state to stop selling cigarettes

Daily Times
15 Aprir 2007
Pakistan

News - Shopkeepers in Indian state to stop selling cigarettes.

[ Kerala's traders union has taken a decision that from April 16 onwards, no shops will sell cigarettes in the state but for how long this decision will be continue...]

THIRUVANANTHAPURAM: A tax row between cigarette companies and vendors in southern India may force smokers to go cold turkey with shopkeepers planning to halt cigarette sales from Monday.

Shopkeepers want cigarette manufacturers to absorb a 12.5 percent value-added-tax imposed by the Communist-led government in the southern state of Kerala from April 1. But the companies have refused to do so.

“From April 16 onwards, no shops will sell cigarettes in the state. We have taken the decision to register our protest,” said T. Naseeruddin, head of the United Business and Traders Association, representing shops in the state of around 30 million people.A packet of 10 cigarettes of popular brand Wills sells for 34 rupees (80 cents) here.

The head of the state traders association said profit margins will drop drastically if the vendors bear the costs of the new tax, which will leave them only a 10-paise profit on each pack of cigarettes sold, he said. “The majority of the shopkeepers are poor and if the profit margin is very low, why should we sell it?” asked Naseerudin.

The decision, to take effect from Monday, has already resulted in the shortage of popular brands with smokers stockpiling their favourite cigarettes. “I have stocked my brand for 10 days. I don’t think that the traders will continue their protest indefinitely,” said Thomas John. afp

online available at- http://www.dailytimes.com.pk/default.asp?page=2007%5C04%5C14%5Cstory_14-4-2007_pg4_19

Pic and choose: Statutory warnings go up in smoke?

News :- Pic and choose: Statutory warnings go up in smoke?

Times of India

April 15 2007

Kanpur.

" [But would pictures serve as a viable method in India which is home to 200 million tobacco users?] "

The Health Minister wants tobacco products to carry pictorial warnings to discourage consumers. Will pictures speak louder than words? In an attempt to promote healthy living and dissuade people from smoking, the Health Minister Ambumani Ramadoss recently announced that it would be mandatory for tobacco companies to carry pictorial warnings including photographs of corpses, disfigurements caused due to cancer and smoking induced impotency on cigarette and pan masala packets.

While written statutory warnings have not been able to discourage people from smoking, we find out whether picture support would prove helpful for the anti-tobacco cause or if there's a need for a stronger campaign to cut down on tobacco consumption in the country.

According to Ramadoss, no matter what the size of the packet, tobacco companies will not be able to sell their products sans pictorial warnings. But would pictures serve as a viable method in India which is home to 200 million tobacco users? "Any kind of effort to discourage people from smoking is worth applauding. What needs to be done is to make continuous efforts, lest the issue lose its seriousness," opines adman Prasoon Joshi, who had worked on a lot of anti-smoking campaigns, the latest being with Viveik Oberoi and Urmila Matondkar.

Reacting to the announcement of the Ministry, actor Suresh Oberoi, who was a chain smoker earlier, says, "When my own son stood up for this cause, I decided to kick the habit. As for the pictorial warnings, well, they would indeed catch the attention of the people, but I think those who've remained unperturbed by written statutory warnings will not be affected by pictures either." "I believe a sound campaign against tobacco consumption is required to spread awareness about the ill-effects of the same," adds Oberoi.

Interestingly, Ramadoss' proposal is not novel and pictoral warnings on tobacco products are already in place in Canada, Brazil, Australia, and Singapore. The European Union too has been pushing for pictorial warnings on cigarette packets, with Belgium already bringing in legislation to this effect.

online availabe at - http://timesofindia.indiatimes.com/City_Supplements/Kanpur_Times/Pic_and_choose_Statutory_warnings_go_up_in_smoke/articleshow/1907330.cms