India's biggest tobacco maker ITC Ltd expects annual revenue from its non-cigarette consumer goods to more than double over the next five years, the Business Standard paper reported on Friday.
Revenue from foods and personal care is expected to be 20 billion rupees ($445 million) in the fiscal year to March 2007 and reach approximately 50 billion rupees in five years, the paper quoted Chairman Y.C. Deveshwar as saying. ITC is also willing to invest up to 10 percent of its pre-tax profit in new businesses, Deveshwar said, up from 5 percent now.
Kolkata-based ITC, which is 31.7-percent owned by British American Tobacco Plc, also has interests in hotels, paperboard, technology, apparel and retail. But cigarettes make up more than two-thirds of its revenue. It has set up three "Chapel Fresh" stores in the cities of Hyderabad, Chandigarh and Pune as a pilot to sell fresh fruits and vegetables, and will ramp up the number of outlets shortly, Deveshwar said.
Reliance Industries Ltd, India's top refining and petrochemical company, is investing $5.6 billion in multiple retail formats ranging from convenience stores to hypermarkets. It expects revenues of $20 billion from retail by 2010. The Indian retail industry is estimated at about $300 billion, and is forecast to grow to $427 billion in 2010 and $637 billion in 2015, according to consultancy Technopak Advisors.
Organised, or branded, retail makes up only 3 percent of this market. Foreign multiple-brand retailers are banned except by way of licence or franchise deals and cash-and-carry formats.
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