Senior executives with the group said, "We are looking at entering new categories such as spices and rice under the Aashirvaad brand."
ITC has already launched whole-wheat flour, or atta, and iodised salt under Aashirvaad. The company believes that spices, which is dominated by the unorganised sellers, is a big potential market in India.
The market for spices in India is believed to be around Rs 10,000 crore (Rs 100 billion), of which the branded segment is only Rs 600 crore (Rs 6 billion). Currently, the major players in this market are: Badshah, Everest, MDH, and Hindustan Lever.
HLL has already made a foray into the spices business under the Knorr Annapurna brand. Recently, the consumer goods giant has also launched branded rice under the Annapurna brand.
The ITC's proposed foray raises the prospects of a keener competition in the organised spices market. Sector analysts feel the challenge for the new entrants into this sector was to convince consumers that branded spices are better than home-made ones.
ITC Foods, the foods subsidiary, aims to contribute over Rs 500 crore (Rs 5 billion) to the group's top line over the next four to five years.
The growth, the company hopes, would come by expanding the product range, which currently includes staples, confectionery, snacks and ready-to-eat products.
ITC has a long way to go to challenge HLL, analysts feel. They said the company was currently banking on its strong brand equity and wide distribution network- its two major strengths.
"The game plan is all about strategic synergy," ITC sources said. To move into the branded-packaged foods segment, the company leveraged the agricultural products division for sourcing, ITC Welcomgroup for specialist cuisine, and the packaging division.
