ITC to invest substantially in property sector

ITC Limited, previously the Imperial Tobacco Company of India Limited, is an Indian conglomerate with a turnover of US $ 4.75 billion and ranking third in pre-tax profit among India’s private sector corporations, and is going to invest in the property sector before long. The company posted a 17.4% growth at Rs 879 crore in net profit for the first quarter ended June despite tough economic conditions and as per experts, this has emboldened its spirits.

What are the immediate plans of this Indian giant then? YC Deveshwar, Chairman of ITC, became candid in this regard, recently and said reporters that it is “willing, ready and able to make investments in two of its businesses — paper and hotels.”

Let’s elucidate the development n brief. Speaking to reporters, Mr. Deveshwar said, ITC has the competence to invest a billion dollar over the next five years in the paper business and a couple of billions dollars in the hotels business and it, at present, is engaged in exploring opportunities to expand the paper business. There are strong changes that it could set up a greenfield paper manufacturing plant as big as the existing one (which has a capacity of half a million tonne and was set up at an investment of Rs 3,000 crore).

As per him, the new plant could be set up at an investment of Rs 4,000-5,000 crore, over a period of four or five years. However, deliberations are going on regarding the final location. It can be anywhere at Gujarat, Madhya Pradesh or Andhra Pradesh, but it will depend on conditions, including easy availability of water, paper pulp etc. it has been learnt, that the company may go for acquisitions in the paper space, if it becomes necessary. The project will depend on availability of land.

ITC is also looking for hotel acquisitions thanks to the existing situation (going through the brunt of downturn).