ITC Sees Strong H2 Demand, Focuses on Premium & Health

New Delhi, Jul 16 (PTI) ITC, which is expanding its play in the packaged food space, is optimistic about demand trends in the second half of FY26, aided by the festive season, rising premiumisation across urban and rural markets and a growing consumer preference for health-oriented products, said its food division chief executive and Executive Director Hemant Malik.

He also flagged concerns over elevated edible oil prices and weather-related uncertainties, but said the overall consumption environment has shown signs of improvement and the momentum is expected to continue.

"We have seen improvement, and I think the improvement should continue. Everything is not always linear. There might have been pent-up demand, which is coming up now, so I am hopeful that it will continue," Malik told PTI.

The second half of the year is traditionally stronger for consumption in India due to the festive season, he said, adding that innovation and premiumisation will remain key growth drivers.

"I think the last six months are better months for the country," Malik said, while highlighting the role of innovation and premiumisation as key growth drivers.

According to Malik, a significant shift in consumption patterns is happening towards "premium and super-premium products", which are witnessing growth not only in urban centres but also in rural markets.

"When we do some store-level checks, we find that the portfolio of products available in rural is fairly similar to urban. Rural India is also seeing premiumisation, and even super-premium products are growing," he said on the sidelines of an event hosted by industry body FICCI.

Citing data sourced from consumer research firms, Malik said: "The shift of premium product usage in rural, super premium usage has moved from 30 per cent to 42 per cent."


"The consumer is no longer buying just because of price. They understand quality, they understand the reason to purchase, and that is an opportunity for manufacturers and brand people to really think and understand the consumer," he said.

On the outlook, Malik said commodity inflation remains a key watchpoint, particularly in edible oils, a major input category for the company.

"Prices still remain on the higher side, and with Hormuz trade again being closed, we will have to see what happens. That is one stress point from a commodity perspective," he said.

He also said the company is monitoring the potential impact of El Nino and weather-related developments, though the improvement in monsoon conditions during July is encouraging.

On ITC's strategy in the health and wellness segment, Malik said that consumers are increasingly seeking products that combine taste with nutrition, prompting the company to expand its portfolio across categories.

He highlighted offerings under Yoga Bar, high-protein atta, sugar-free biscuits and the recently-launched Be Natural Coconut Cola, adding that more health-focused products, including protein drinks, are in the pipeline.

"Consumer is looking for health and taste. Consumer is reading the back label and wants to understand what exactly the product is offering. The role of brands in building trust is becoming even more important," Malik said.

ITC's branded packaged foods business is one of the fastest growing food businesses in India, where it operates with a host of brands, which include - Aashirvaad, Sunrise, Bingo! Sunfeast, Fabelle, Sunbean, Yippee!, B Natural, ITC Master Chef, Farmland, among others.