ITC’s growth recipe for food business is about strategic takeovers

After acquiring Yoga Bar and 24 Mantra Organic, ITC Foods is now placing greater emphasis on strategic takeovers to speed up its expansion, enter fast-growing categories quickly, and cater to increasing consumer demand for healthier, more indulgent, convenient, and premium food options. Hemant Malik, executive director of ITC, told The Times of India that the approach is part of the company’s broader ‘ITC Next’ strategy, which positions value-accretive acquisitions as a key driver of growth.

To navigate the challenges posed by slow urban demand, weak household incomes, and high inflation, ITC plans to use both brownfield and greenfield investments. During the financial year, the company said it faced strong inflationary pressure on edible oil, wheat, maida, cocoa, and packaging materials. These pressures were partly handled through internal cost management, price adjustments, and a push towards selling more premium products.


Malik said he believes the premium category will grow at “at least twice the pace of the overall FMCG business.” He said, “We are creating offerings for the health-seeking new India, growing per capita India, Gen Z, as well as consumers seeking richer and new experiences. Many of them would have premium pricing. It's all about providing the right value to the consumers... Premium is not limited only to metros; there are premium customers across the country.”

Currently, around 30% of ITC’s food portfolio consists of premium products. The company’s shift towards this higher-end segment appears to be working. In the financial year 2024-25, revenue from packaged foods rose by nearly 28% to ₹21,982 crore.

Malik said health-focused products are emerging as the biggest growth driver. “Health is the fastest growing segment for us, growing at 400 times that of the remaining foods business. We're also keeping a close watch on emerging consumer needs - whether it's health, nutrition, convenience, or indulgence. These trends shape how we evolve our portfolio and explore new categories. We are creating a lot of new products based on evolving consumer needs, for every life stage or cohort,” he said.

According to Malik, ITC sees significant scope for growth in the food segment, since a large portion of the market is still unbranded.