NEW DELHI: After the recent acquisitions of Yoga Bar and 24 Mantra Organic, ITC Foods is sharpening its focus on strategic takeovers to accelerate growth, gain rapid entry into high-potential categories, and align with consumer preferences for health, indulgence, convenience, and premium offerings. This move aligns with the 'ITC Next' strategy, which prioritises value-accretive acquisitions as a core expansion driver, Hemant Malik, executive director, ITC, told TOI.
The firm aims to boost expansion via a mix of expansions at existing sites and new projects, tackling the difficulties posed by low citywide spending due to poor family earnings and escalating prices.
During the year, there was severe inflationary pressure in edible oil, wheat, maida, cocoa, and packaging inputs, which, the company said, was partially mitigated through cost management initiatives, calibrated pricing actions, and a strategic push towards premiumisation.
Malik expects the premium category to grow at least twice the pace of the overall FMCG business. "We are creating offerings for the health-seeking new India, growing per capita India, Gen Z, as well as consumers seeking richer and new experiences. Many of them would have premium pricing. It's all about providing the right value to the consumers... Premium is not limited only to metros; there are premium customers across the country," he said.
Currently, approximately 30% of ITC's portfolio consists of premium products. This approach appears to be successful. In the fiscal year 2024-25, ITC’s earnings from packaged foods rose by almost 28%, totaling Rs 21,982 crore.
"The wellness sector is expanding rapidly for us, increasing at 400 times the rate of our other food-related operations. We are closely monitoring developing consumer demands—be they related to well-being, nourishment, ease-of-use, or enjoyment. Such tendencies guide how we adapt our product range and venture into fresh markets. In response to shifting customer preferences across various age groups and stages of life, we are introducing numerous innovative items," Malik stated.
The food sector still holds substantial potential for expansion—particularly because much of it continues to be unbranded, as per Malik’s observations.