ITC Limited

1 1 ITC LimitedOne of India s Most Admired and Valuable Companies2 Profile OneofIndia smostAdmiredandValuablecompanies-MarketC apitalisation:~ AUS$8billionenterprisebyRevenue-~58%ofNe tRevenuefromnon-Cigarettesegments LeadingFastMovingConsumerGoods(FMCG)mark eterinIndia-Establishedseveralworld-clas sbrandsinthelast10years 10yearValueAddition~ (US$51billion).75% ITC&itsGroupCompaniesemployover32,000peo pledirectly;Sustainabledevelopmentmodels andvaluechainshavesupportedcreationof~6m illionsustainablelivelihoods Aglobalexemplarinsustainablebusinessprac tices-Onlyenterpriseintheworldofcomparab ledimensionstohaveachievedandsustainedth e3keyglobalindicesofenvironmentalsustain abilityofbeing'waterpositive'(for15years ),'carbonpositive'(for12years),and'solid wasterecyclingpositive'(for10years)33 Overthelast5years ValueAdditionat` ( )and ContributiontotheExchequerat` ( )75% of the incremental Value-Added accrued to the ExchequerITC remains amongst the Top 3 Contributors to Exchequer (pvt.)

2 Sector)4 ITC Performance Track RecordSensex (CAGR 95-96 to 16-17) : Cap and TSR based on FY-end prices for FY96 and FY17Rs. Cagr 95-96 to 16-17 Gross Revenue5,11555, Revenue2,53638, , , Employed 1,88647, ROCE% Capitalisation5,571340, Shareholder Returns % (` crs)5 ITC s rankingAmongst all listed private sector : No. 5 PAT: No. 5 Market Capitalisation: No. 4 Note: Based on Published Results for Q2FY18,Market Capitalisation based on 31stDec 20176 ITCrankedasthemostadmiredcompanyinIndiai n2014(Fortune-HayGroupsurvey) Oneoftheforemostintheprivatesectorinterm sof: Sustainedvaluecreation Operatingprofits CashProfits ITCwontheprestigiousPorterPrize2017for'E xcellenceinCorporateGovernanceandIntegra tion'andforitsexemplarycontributionin'Cr eatingSharedValue'. ITCranked3rdamongstleadingcorporatesinIn diaintermsofCorporateReputation(NielsenC orporateImageMonitor2014-15) ITCrankedmostactiveinCSRforthethirdyeari narow(NielsenCorporateImageMonitor2014-1 5)Awards & Accolades (1)7 Awards & Accolades (2) WorldBusinessandDevelopmentAward2012 attheRio+ (2011).

3 ChairmanYCDeveshwarconferredtheIndianVis ionary-BusinessLeaderAwardbyTheEconomicT imes,forbeingthecountry (BMA).ChairmanYCDeveshwarconferredthepre stigiousBangaBibhushanaward, & Accolades (3)Businessworld FICCI CSR award in Large Enterprise categoryBestOverallCorporateSocialRespon sibilityPerformance:InstituteofPublicEnt erpriseAIM Asian CSR Award by the Asian Forum on Corporate Social ResponsibilityRainforestAllianceawardedI TC'sBhadrachalamUnit,theForestStewardshi pCouncilForestManagementcertificationITC H otelsawardedthe MostTrustedHotelbrand inthePublicChoiceHonourscategoryattheTim esTravelHonours9 Recent Awards & Accolades (1)JohnPlayerswontopawardsatGoaFest2016( CreativeABBYA wards)forinnovativeuseofimage/designands ocialmediacontentSunfeast,Bingo!andYippe e!featuredamongtheTop5intheFoodscategory WillsLifestylewasrecognisedatthe2016 DMAiCREATEFFECTA wardsforcreativityin InteractiveExperientialMarketing Vivelfeaturedamongthetop10 Buzziestbrands acrosscategoriesITCnamedIndia's'Buzziest 'Corporatebrandbyafaqs!

4 ,thecountry'sleadingmediaportalVivel, Awards & Accolades (2)ITCL imitedwasrecognisedandfelicitatedasthe CorporateTrailblazer +LeisureIndia&SouthAsia's India'sBestAwards ITCG randBharatwasranked# s Vision Statement12 ITC s Vision Makeasignificantandgrowingcontributionto wards: mitigatingsocietalchallenges enhancingshareholderrewardsBy creating multiple drivers of growthwhile sustaining leadership in tobacco, and focusingon TripleBottomLine Performance EnlargecontributiontotheNation s-Financialcapital-Environmentalcapital- Socialcapital13 Key Corporate Strategies Focusonthechosenbusinessportfolio FMCG;Hotels;Paperboards,Paper&Packaging; AgriBusiness;InformationTechnology Blenddiversecorecompetenciesresidinginva riousBusinessestoenhancethecompetitivepo weroftheportfolio Positioneachbusinesstoattainleadershipon thestrengthofworld-classstandardsinquali tyandcosts Craftappropriate StrategyofOrganisation andgovernanceprocessesto.

5 Enablefocusoneachbusinessand Harnessdiversityofportfoliotocreateuniqu esourcesofcompetitiveadvantage14 Strategy of Organisation3-Tiered Governance Structure15 ITC s Business Portfolio FMCGP aperboards, Paper & PackagingHotelsAgri BusinessInformation TechnologyCigarettesPersonal CareFoodsLifestyle RetailingEducation & StationerySafety Matches & Incense Sticks16 ITC s Cigarettes Business Marketleadership Leadershipacrossallsegments-geographic&p rice State-of-the-arttechnologyandworld-class products17 Cigarette Industry in India Legalcigarettesaccountforonly~11%oftobac coconsumedinIndiaduetoapunitivetaxationa nddiscriminatingregulatoryregime Indiaisthe4thlargestillegalcigarettemark etintheWorld; 48% (Source:GlobalAdultTobaccoSurveyIndia201 0) Cigarettes contribute 87% of Tax Revenue, despite constituting only 11% of Tobacco consumptionThecumulativegrowthintaxincid enceoncigarettes,aftercognisingforthelat estincreaseinCessrates,standsatastaggeri ng202%since2011-12, ShareTax Revenue ShareNote: Consumption Share and Tax Revenue Share based on 2014/15 data19 Widening differential in Excise Duty rates between Cigarettes and Other Tobacco Products Onaperkgbasis,thedifferentialinExciseDut yratesbetweencigarettesandothertobaccopr oductshaswidenedfrom29timesin2005/06toov er53timescurrentlySource: Tobacco Institute of India20 Cigarettes are least affordable in India Source.

6 WHO Report on the Global Tobacco Epidemic, 2015-Raising Taxes on Tobacco CigarettetaxesinIndiaare14timeshighertha nUSA,9timeshigherthanJapan,7timeshighert hanChina, Capita Consumption of Tobaccoin India (gms per year) Source:World Cigarettes ERC Statistics, Tob Board& Industry Estimates gms/YrPer Capita consumption is ~60% of World Average22 Per Capita CigaretteConsumption 11% of World averageSource: The Tobacco Atlas -4th Edition(American Cancer Society) Although India accounts for 17% of world population, its share of world cigarette consumption is just Per Capita consumption in India ~11% of World average2323 FMCG Cigarettes Legalcigaretteindustryvolumesremainunder pressure ContinuedgrowthinIllegalindustry CumulativeincreaseintaxincidenceonCigare ttesup~202%overthelast6years Hon bleKarnatakaHighCourtstruckdowntheCOTPA rulesthatmandatedprintingof85%GHWonCigar ettepacksinDec 17;sincestayedbyHon bleSupremeCourt24 Creating world-class brands for Indian Consumers25 Rapid scale up of FMCG businesses(` crs)2626 Annual Consumer Spends of nearly 14000 cr.

7 (FY17)27 Branded Packaged Foods PortfolioBiscuits, Staples, Snacks, Noodles & Pasta, Confectionery, Ready to Eat, Juices, Dairy,Chocolatesand Coffee2828 Fabelle Chocolate Boutiques Fabelle Chocolate Boutique at ITC Grand CholaGanacheGiandujaSingle Origin CacaosFabelle Gift Hamper Fabellecentre-filled chocolate bars29 Branded Packaged Foods: Some recent launches (1)FabelleExquisiteChocolatesMixed Fruit & Dry Fruits JuiceSunfeastDairyWhitenerCandyManClear Candy MangoCandymanCrunchy Peanut CandymanDuochooStrawbery30 Bingo! No RulzSunfeast Farmlite Protein PowerCandyman Cola JoshSunfeastA2 Cow Milk BiscuitsSunfeast Farmlite Digestive (5 Grain)Sunfeast YiPPee! Mood Masala100% Not From Concentrate Pomegranate juiceBranded Packaged Foods: Some recent launches (2)3131 Integrated Manufacturing and Logisticsfacilities An update CivilworksattheIntegratedManufacturingan dLogisticsfacilitiesprogressingaspersche dule PanchlaandKapurthalafacilitiesoperationa lisedinNov 17.

8 CapacityutilisationatUluberia,MysuruandG uwahatifacilitiesbeingrampedup. Care Products Portfoliocomprisefollowingbrands: The Engage EngageON Engagepremiumperfumes . LaboratoireNaturel Astate-of-the-artconsumerandproductinter actioncentre leveragedtolaunchuniqueanddifferentiated products Launchedmoisturisingskincreamundertherec entlyacquired Charmis Care: Some recent launches (1)Engage Premium Perfume SpraysFiamaGel + Cr me Body WashFiama Frangipani & Almond CreamCharmis Moisturising Cold Cream34 Personal Care: Some recent launches (2)Engage On+ Premium PerfumeEngage Sport RangeEngage Pocket PerfumeVivel Lotus OilEssenzaDi Wills Fragrance35 Education & Stationery Products Business Leveragesprintingandpaperknow-howtoaddre sssuitableopportunitiesinthestationeryma rket-Classmate,SaathiandPaperkraftbrands continuetoenhancemarketstanding Industrygrowthdrivenbyincreasingliteracy andenhancedscaleofgovernmentandpublic-pr ivateeducationinitiatives Geometryboxeswitnessedrobustgrowthbacked bynewlaunches PortfolioextensionwiththelaunchofClassma tePuzzles Classmate:MarketleaderinNotebookssegment 36 Lifestyle Retailing WillsLifestyle brand,positionedatthepremiumendofthemark etcontinuestofulfillifestyleaspirationsb yofferingelegantdesignsinhighqualityprem iumfabricsandstyles availablein400outletsacross56citiesinclu dingsixexclusiveboutiquestoresacrossITCH otels.

9 IntheYouthfashionsegment, JohnPlayers continuestodrivefashionimageryanchoredon boldandedgyfashion. Mangaldeep continuestofortifyitsmarketstandinginthe AgarbattiandDhoopsegment. AIM continuestobethelargestsellingsafetymatc hesbrandinIndia. LaunchedinSeptember2016onbothAndroid& sticks (Agarbattis) & Safety Matches38 Hotels One of the fastest growing hospitality chains in India Greenest Hotel Chain in the world Leader in Profitability39 Hotels & Tourism industry Industry:CurrentRoominventory~240,000roo ms,ofwhich~66,000roomsareintheLuxuryandU pper-Upscalesegments ForeignTouristArrivals(FTA)growthhaspick edupinthelastfewquarters. Goingforward,aseconomicconditionsandinfr astructureimprove,leisuretourismandbusin essrelatedtravelisalsoprojectedtogrowfas ter ForeignTouristArrivalsintoIndiaisproject edat~11millionby202140 TheChain:104propertiesacross74locations 4 Brands:ITCH otels,WelcomHotel,Fortune&WelcomHeritage 25 Five-StarDeluxe/Five-StarPropertieswitho ver4800rooms 45 FortuneHotelswithover3500rooms 34 WelcomHeritagePropertieswithover800rooms IndustryhasseensomeimprovementinARR,inth elastcoupleofquarters.

10 Overall,duetoexcessiveroominventory,pric ingscenariocontinuestobesluggish. Company sfirstoverseasprojectinColombo,beingunde rtakenbyawholly-ownedsubsidiaryinSriLank a Constructionactivityisprogressingaspersc heduleHotels Business Projectsunderway: ITCH otels:Kolkata,Hyderabad,Ahmedabad,Srinag ar WelcomHotelsat3cities;Bhubaneswar, Responsible Luxury ethos woven into the Brand IdentityITC Hotels: World s Greenest Luxury Hotel ChainAll ITC Luxury Hotels LEED Platinum certified42 Paperboards & Packaging Business No. 1 in Size No. 1 in Profitability World-class Environmental Performance43 Indian Paperboard market (worldaverage ) Indianpaperboardmarketgrowingat6% Value-addedPaperboards-thefastestgrowing segment(12% )inIndiadrivenby: Increasingdemandforbrandedpackagedproduc ts Growthinorganisedretail Useofpackagingasakeydifferentiator,espec iallyintheFMCG sector44 ITC s Paperboards, Paper & Packaging businesses MarketleaderinValue-AddedPaperboardssegm ent World-classtechnology&quality FullyintegratedOzonebleachedPulpMill( ) oneofitskindinAsiameetingworld-classenvi ronmentalstandards India sfirstBleachedChemicalThermoMechanicalPu lp(BCTMP)mill,recentlycommissionedbyITC, willfurtherreducedependenceonimportedpul pandprovidesustainedcompetitiveadvantage totheBusiness Strategicprojectsunderway-ValueAddedPape rboard(+ ),Decor(+ )TPA.