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Informist, Friday, Jun. 27, 2025

KOLKATA – Diversified conglomerate ITC Ltd. is working towards developing and promoting climate resilient agriculture backed by digital technology which will help it increase its back-end sourcing for its cigarettes and non-cigarettes consumer goods thus leading to rapid scale-up of these businesses. It will also help the company increase value-added exports which in turn will lead to an increase in foreign exchange earnings.

According to the company's annual report for 2024-25 (Apr-Mar), ITC is working on a 'Climate Smart Agriculture' programme which is aimed at derisking farmers from erratic weather events through the promotion and adaptation of a climate resilient approach premised on dissemination of relevant package of practices, adoption of appropriate mechanisation and provision of institutional services.

ITC has been strengthening its collaborations with leading research institutions across India to build cost-effective, high-yielding, and resilient agricultural value chains. By mapping climate hotspots and focusing on regenerative agriculture, ITC introduced location-specific seed varieties in FY25 and tailored agricultural practices in key states. This approach is aimed at enhancing crop intelligence, reducing greenhouse gas emissions, and improving soil health.

Although ITC is not directly engaged in any plantation or agricultural harvesting, it directly works with over 2.1 million farmers and over 2,050 farmer producer organisations across 11 states in over 18,000 villages through its Metamarket for Advanced Agriculture and Rural Services, or MAARS services. Apart from sourcing tobacco and other agricultural products, ITC provides these farmers with modern and next generation agricultural technologies and related benefits to improve the yield.

ITC is one of the very few consumer goods companies in India that engages directly with farmers to secure its back-end sourcing which helps it keep procurement costs in check and ensures a steady flow of raw materials. ITC is now planning to increase coverage of its MAARS service network.

During FY26, ITC's agricultural business segment, which is a key strategic division for the company, continued to map risks and opportunities arising out of the unfolding global trade dynamics and build adaptive capacity to enhance resilience of its business models.

In spite of the challenging operating environment, ITC leveraged its strong farm linkages, extensive sourcing expertise, enabling traceable, attribute-based and identity-preserved sourcing of commodities, multi-modal logistics capability, agile supply chain operations, deep customer relationships, and focus on scaling up the value-added agricultural products portfolio, to drive robust growth during the year, the company said in its annual report, explaining the reasons for its financial performance in times of consumer demand slowdown.

Foreign exchange earnings of the ITC group over the last 10 years aggregated nearly $9.5 billion, of which agricultural exports constituted around 60%. During FY25, ITC and its subsidiaries earned INR 104.5 billion in foreign exchange mainly on account of exports of agricultural commodities.

ITC's scale of agricultural operations encompasses over 3.5 million tonnes of annual throughput in 22 states and over 20 agricultural-value chains. The strategic focus of the business continues to be on accelerating growth by rapidly scaling up its value-added agricultural products portfolio, straddling multiple value chains comprising spices, coffee, frozen marine products and processed fruits, amongst others, ITC said in the annual report.

During FY25, ITC leveraged its MAARS services to strengthen farmer connections, improve traceability, and drive sustainable agricultural practices. This business unit significantly expanded its value-added portfolio, achieving substantial growth in organic, steam-sterilised, and processed powder segments. Going forward, the organic sourcing capabilities, farm linkages and traceability would also become a source of competitive advantage for the organic portfolio of ITC's consumer goods businesses, the annual report said.

On Friday, shares of ITC closed 0.4% lower at INR 418.65 on the National Stock Exchange.  End

Reported by Avishek Rakshit

Edited by Ashish Shirke

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