This represents the first major investment announcement by ITC regarding its core business of cigarettes, which accounted for approximately half of its revenues a substantial portion of its profits.
The Khidirpur cigarette unit would need some more land to expand as it was already operating at capacity and did not have a room for a raw material handling facility, indicated sources.
ITC was looking at upgrading its cigarette unit to beat competition from imports and contraband.
Other proposals placed by Y C Deveshwar, chairman of ITC Ltd, included a hotel, a complex for its agri-business hub, a foods and biscuits plant and a development centre for its information technology business.
The West Bengal government has requested ITC to set up a logistics hub, and Deveshwar said the proposal would be examined.
Deveswar told reporters at the state government headquarters, Writers' Buildings, after an hour long meeting with West Bengal Chief Minister Buddhadeb Bhattacharya, that ITC would like to invest Rs 650 crore (Rs 6.5 billion) initially in the state in two projects -- the five-star
hotel and expansion of the Khidirpur cigarette unit.
According to Deveswar, ITC would invest close to Rs 350 crore (Rs 3.5 billion) in the proposed hotel project.
The company has not yet identified the area but a hotel would need close to 10 acres.
ITC will invest around Rs 300 crore for the expansion of Khidirpur unit which is due, said the ITC chairman.
The FMCG giant plans to set up a food plant in the state which would primarily produce biscuits and foods, he said.
The company currently had a strong presence in confectionery segment with its Sunfeast brand.
The company has asked for 20 acres for the food and biscuits unit.
Besides foods, it has evinced interest to set up a agro retail hub on a plot of around 20 acres along with a cold storage.
"We have yet to identify the area," said Deveswar. He indicated that ITC was considering the state government's proposal to set up a logistics hub near Kolkata-Delhi national highway.
It has also asked for 50 acres in the Rajarhat new town area for an IT project that would create 1,000 jobs through its subsidiary ITC Infotech Ltd.
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