ITC strategy: 4 pillars to chase No. 1 FMCG in FY26

What ITC laid out in its FY26 annual report

Kolkata-headquartered ITC Ltd has set out an aggressive medium-term plan to scale its non-cigarette businesses, with FMCG at the centre of its ambition to become India’s No. 1 FMCG company. The company detailed the roadmap in its FY26 annual report released on Friday. ITC positioned the effort as a multi-business growth strategy that also includes digital agriculture, fresh foods, and sustainable packaging. Alongside growth initiatives, the company reiterated a long-term sustainability goal of achieving net zero operations by 2050.

The four-pronged FMCG playbook: core, adjacencies, future, vectors

ITC said its FMCG strategy is anchored in “strengthening the core” by extending trusted mother brands into “value-added adjacencies,” developing “portfolios for the future,” and nurturing “new vectors of growth.” The stated direction reflects a structured approach to expand beyond established categories while protecting scale brands. In the annual report narrative, the company also indicated it is making strategic investments to build future categories and scale nascent businesses. The focus areas it highlighted for new portfolios include health, nutrition, convenience, and premium products.

Brand expansion: Aashirvaad and Sunfeast move into new categories

As part of the “strengthening the core” and adjacency expansion, ITC pointed to the extension of mother brands into newer product categories. The report references brands such as Aashirvaad and Sunfeast as examples of core franchises being expanded. The company’s broader objective is to build a larger consumer goods portfolio that can compete with the market leader, a position currently held by Hindustan Unilever (HUL). ITC also indicated it is active on acquisitions and integration to strengthen presence in areas such as health, organic, and convenience foods.

Consumer traction: non-cigarette FMCG spend crosses ₹37,000 crore

ITC said its non-cigarette FMCG segment has crossed ₹37,000 crore in consumer spend, positioning it as a meaningful scale business within the group’s wider portfolio. The company’s stated approach is to keep investing in brand building, innovation, and category development to drive the next phase of growth. The annual report frames this as part of “ITC Next,” a strategy aimed at reshaping growth and profitability. ITC also described the role of its business mix, noting that cash flows from the legacy cigarette business support investments in FMCG and other capital-intensive ventures.

Digital agriculture: ITCMAARS targets 4,000 FPOs and 1 crore farmers

Digital acceleration is a key pillar in the group’s agricultural roadmap through the ITCMAARS platform. ITC said ITCMAARS aims to onboard 4,000 Farmer Producer Organisations (FPOs) and reach one crore farmers by 2030. The platform is designed to digitise the farm-to-fork supply chain, aligning agriculture linkages with downstream consumer categories. In the same context, the company mentioned a target of a 15-20% boost in crop yields linked to the digital agriculture effort.

Fresh foods: stepping into online food services and premium experiences

ITC identified fresh foods as a new growth vector to participate in the fast-growing online food services segment. The company linked this move to widening access to premium food experiences for Indian consumers. In the context provided, ITC’s fresh food push includes over 70 cloud kitchens. The stated strategy indicates a deliberate attempt to build a direct-to-consumer and services layer alongside packaged products.

Value-added agri-products: pivot aimed at growth and margin improvement

Separately, ITC said it has pivoted towards rapidly scaling its value-added agri-products portfolio. The company framed this as a step to accelerate growth and improve margins. This complements the ITCMAARS agenda, where stronger supply chain visibility and farm linkages can support differentiated agricultural offerings. The report’s emphasis on value-added agri-products suggests a focus on higher realisations rather than commodity-led volumes.

Sustainable packaging and paperboards: investments and integration plans

ITC said it will continue investing in sustainable packaging solutions, including recyclable and fibre-based alternatives to single-use plastic. The company also said it will integrate the recently announced acquisition of the pulp and paper undertaking of Aditya Birla Real Estate Ltd. ITC described the acquisition as a strategic fit to expand its paperboards business. The packaging emphasis ties into both regulation-linked material transitions and brand-led demand for environmentally aligned packs.

Hospitality expansion: 250 properties and 22,000 keys by 2031

While FMCG remains the headline growth engine, ITC’s annual report-linked context also highlighted the hospitality roadmap. The company’s hospitality arm is targeting 250 properties with over 22,000 keys by 2031. It also indicated an “asset-light” approach, prioritising management and franchise contracts to scale faster with lower capital intensity. This strategy sits alongside FMCG, agriculture, and packaging as part of a diversified growth plan.

Key targets and disclosures at a glance

Why this strategy matters for investors and the FMCG sector

ITC’s disclosures underline a push to increase the share of growth coming from branded non-cigarette businesses, with FMCG as the primary platform. The four-part FMCG framework also signals portfolio expansion beyond staple categories into health, nutrition, convenience, and premium segments, where incumbents and challengers compete aggressively. The added emphasis on fresh foods and cloud kitchens points to a services layer that can complement packaged foods in an online-first consumption environment. And the ITCMAARS targets indicate a scale ambition in agricultural digitisation that can potentially tighten sourcing linkages for food businesses, while also building new agri-led revenue pools.

Conclusion

ITC’s FY26 annual report lays out a multi-engine growth plan that centres on scaling FMCG through a four-pronged strategy, while also expanding digital agriculture via ITCMAARS, building fresh foods, and investing in sustainable packaging. The company has also reaffirmed its net zero operations target for 2050. Next milestones to watch include progress towards the ITCMAARS 2030 targets, integration of the Aditya Birla Real Estate pulp and paper undertaking, and execution on the fresh food and hospitality expansion plans.