Cigarette-to-FMCG major ITC Ltd is pursuing a long-term strategy to build a cost-effective cold chain for preventing agricultural wastage, a company official said on Friday.
“Recognizing the crucial need to unlock the lost value trapped in agri-wastage, your company is actively pursuing a long-term strategy to build a cost effective cold chain that will contribute to raising rural incomes and lend a new growth driver to your company’s agri-business,” its Chairman Y.C. Deveshwar told shareholders at the company’s 107th Annual General meeting .
He said the agri-wastages, estimated at Rs 92,000 crore, deprive farmers of a potentially large source of income.
“Company’s ongoing investment in setting up the integrated consumer goods manufacturing and logistics facilities (ICML) across length and breadth of the country provide a unique opportunity to co-locate a distributed network of cold chain infrastructure at a shared marginal cost,” Deveshwar said.
The ICMLs comprising food processing plants are being established at strategic locations close to markets, he said, adding that the potential benefits of distributed low-cost cold chain infrastructure to the rural economy are “so attractive” as to encourage the company to take this initiative forward.
“Your company will be establishing the feasibility of this approach through a pilot in the not too distant future. The scaling up will take place together with the establishment of additional mega food processing plants, taking the total number to 20 such facilities over the next 5-10 years,” Deveshwar said.
He said the company’s recent foray into the perishables segment was a step in this direction and several products are being progressively introduced in the market in fresh, dehydrated, puree and frozen formats.
Deveshwar said the company would continue to strengthen its existing FMCG portfolio while entering newer categories and segments.
“Your company aims to launch multiple new products every year to address more closely, preferences of discerning Indian consumer,” he told the shareholders.
Responding to a query, he said, 30 new products were launched last year. ITC Ltd, which has been planning to enter the healthcare business, has hired some professionals to examine business opportunities.
According to him, over the last 22 years, its non-cigarette businesses registered a 19-fold growth, thereby contributing nearly 59 per cent of net segment revenue of the company.