Report and Accounts 2013
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REPORT AND ACCOUNTS 2013 PDF processed with CutePDF evaluation edition www.CutePDF.com REPORT AND ACCOUNTS 2013 CONTENTS ITC: Creating World-Class Brands that Put India First Board of Directors and Committees ............................................................................. 01 Report on Corporate Governance ................................................................................ 12 Shareholder Information ............................................................................................... 26 Report of the Directors & Management Discussion and Analysis ............................... 38 Certificate of Compliance from Auditors ...................................................................... 84 CEO and CFO Certification .......................................................................................... 85 Balance Sheet .............................................................................................................. 86 Statement of Profit and Loss ........................................................................................ 87 Cash Flow Statement ................................................................................................... 88 Notes to the Financial Statements ................................................................................ 90 Report of the Auditors .................................................................................................. 130 Guide to Subsidiaries/Joint Ventures/Associates ......................................................... 133 Consolidated Financial Statements .............................................................................. 135 Ten Years at a Glance .................................................................................................. 184 Financial Highlights Business Responsibility Report ................................................................................... I-XVI Thought Leadership in Sustainability Business Update : ITC Infotech Awards & Accolades REPORT AND ACCOUNTS 2013 ITC: Creating World-Class Brands that Put India First A country's brands are a reflection of its competitive strengths and a manifestation of its innovation and intellectual capacity. I strongly believe that a country's economic capacity is significantly enriched when its institutions build and own internationally competitive brands. Winning brands serve as market anchors to support the competitiveness of the entire value chains of which they are a part. Strong domestic brands create much larger value since they create, capture and retain value within the country. Your Company takes justifiable pride in creating world-class Indian brands that have demonstrated immense vitality in the global Indian market place. Y C Deveshwar, Chairman, ITC Limited Speech at the ITC AGM, 2012 REPORT AND ACCOUNTS 2013 ITC’s Brands: Powering Economic Growth Great brands are not just about delighting the consumer, they are also about powering national economic growth. Brands capture value for the nation in numerous ways – creating intellectual capital, boosting R&D and innovation, and creating large-scale livelihoods by empowering value chains, investing in physical infrastructure and expanding markets. Brands are the badge of a country’s competitiveness. Powerful domestic brands compete effectively with international brands within the country and outside. They create such a popular franchise that some nations are identified with the attributes of great brands that they have produced. ITC is today proud to have created over 50 energetic and popular brands across categories that delight nearly 140 million households. Within a relatively short span of time, ITC has established vital brands with significant salience among consumers like Aashirvaad, Sunfeast, Bingo!, Yippee!, Candyman, mint-o and Kitchens of India in the Branded Foods space and Essenza Di Wills, Fiama Di Wills, Vivel and Superia in the Personal Care products segment. In addition, brands like Classmate and Paperkraft in Education & Stationery products; Wills Lifestyle and John Players in the Lifestyle Apparel business; Mangaldeep in Agarbattis as well as Aim in Matches have established significant market standing and continue to delight consumers with superior offerings. ITC Hotels, with its credo of “Responsible Luxury”, stands apart not only for its exquisite signature properties, cuisine and service excellence but also for being the greenest luxury hotel chain in the world. ITC's hotels business also contributes to the country's tourism landscape and livelihood creation through its other high quality offerings embodied in the WelcomHotels, Fortune and WelcomHeritage brands. ITC’s hotels have pioneered the concept of branded cuisine in India with globally acclaimed restaurants including Bukhara, Dum Pukht and Dakshin. ITC has also set new benchmarks in wellness with its Kaya Kalp Spa brand that offers a new dimension in luxury and an enriching experience. REPORT AND ACCOUNTS 2013 REPORT AND ACCOUNTS 2013 ITC’s Brands: Delighting Millions of Households Foods Offering nothing but the best for the Indian household, ingredients for Aashirvaad products are carefully hand-picked and processed with love and care. Aashirvaad offers superior products in the categories of Atta, Salt, Spices, Instant Mixes and Ready Meals. REPORT AND ACCOUNTS 2013 Sunfeast straddles all segments in the biscuit category and offers high quality products in exciting and innovative formats, which reinforces ITC’s commitment to delivering a world-class product experience to the discerning consumer. REPORT AND ACCOUNTS 2013 Sunfeast Yippee! continues to wow consumers across the country. Its unique round block and long, slurpy & non-sticky noodles have created consumer delight. The range is available in 3 flavours of Magic, Classic and the newly launched Chinese Masala. Sunfeast Pasta Treat continues to offer a delicious and nutritious range of Pasta products in 6 different flavours. Kitchens of India offers authentic, gourmet Indian dishes from across the country crafted by the Master Chefs of ITC Hotels which enable consumers to recreate an exclusive fine-dining experience in their own homes. The delectable range spans vegetarian and non-vegetarian ready-to-eat dishes, masala mixes, chutneys and conserves. The entire range is made with 100% natural ingredients and is free of preservatives. REPORT AND ACCOUNTS 2013 Associated with youth, fun and excitement, Bingo! offers multiple variants of Potato Chips and Finger snacks to fulfil the consumer’s need for variety and novelty with innovative formats and ‘irresistible combinations’ in flavours. Candyman and mint-o offer a mouth-watering range of confectionery products in a variety of flavours and formats which delight consumers across age groups. REPORT AND ACCOUNTS 2013 Personal Care Products Essenza Di Wills personifies innate style with its exclusive range of fine fragrances and personal care products. The brand unites distinct craftsmanship and passion and is an embodiment of fine living. Fiama Di Wills offers a range of expert solutions designed to make consumers look & feel young. With innovation at its core, Fiama Di Wills offers an enviable portfolio of products developed through years of scientific research at Laboratoire Naturel. REPORT AND ACCOUNTS 2013 Adjudged as one of the most exciting brands in the Personal Care segment in India, Vivel has built a strong consumer franchise with its portfolio of bath care and skin care products. With a range of innovative products that offers differentiated benefits, Vivel instils confidence in consumers to fulfil their dreams. ITC’s latest addition in Personal Care Products, Engage is one of India’s first range of couple deodorants. This range of paired deodorants for men and women is crafted to enhance personal grooming and confidence with 24-hour freshness. REPORT AND ACCOUNTS 2013 Lifestyle Apparel Synonymous with elegance and style that is effortless and chic, Wills Lifestyle presents a premium fashion wardrobe for men and women. With a tempting choice of Wills Classic formal wear, Wills Sport relaxed wear, Wills Clublife evening wear and Wills Signature designer wear, Wills Lifestyle offers a truly delightful shopping experience for the discerning customer. johnplayers.jeans is the new language for the fashion-forward youth, featuring an innovative collection of denims and casual wear in edgy styling, bold patterns and contemporary fits. John Players embodies the spirit of the modern youth that is playful, fashionable and cool. John Players presents a complete wardrobe incorporating the most contemporary trends in an exciting mix of colours, styling and fits. REPORT AND ACCOUNTS 2013 Education & Stationery Products India’s No.1 notebooks brand built on a meticulous understanding of consumer needs, Classmate’s expanding portfolio today also includes pens, wood-cased & mechanical pencils, geometry box sets, erasers, sharpeners and scales. Colour Crew: The new brand of art stationery from Classmate that offers an exciting range of superior quality student art materials which includes non-toxic colour pencils, wax crayons and sketch pens. Paperkraft is the leading provider of premium executive & office paper stationery including notebook ranges of Green Impression & Signature Series as well as an assortment of premium pens. Incense Sticks Matches ITC's range of safety matches includes popular brands like Aim, Aim Special, Aim Premium and i Kno to effectively address the needs of different consumer