ITC is taking a deliberately cautious approach to acquisitions in India's rapidly expanding personal care market, even as competitors aggressively pursue digital-first brands and premium segments. The company's strategy focuses on selective investments rather than the acquisition spree adopted by rivals like Hindustan Unilever and Marico.

Strategic Acquisition Philosophy

ITC's acquisition strategy centers on careful evaluation and sustainable growth rather than rapid market expansion. According to Satpathy, the company prioritizes brands that operate in white spaces with unique strengths where ITC may lack adequate bandwidth or capabilities. The company's older acquisitions have demonstrated this approach's effectiveness, with Savlon (acquired in 2015) and Nimyle (acquired in 2018) growing to six to seven times their original size.

"When we acquire a brand, the question is—can we give it that time and attention it needs?" Satpathy explained. "You also have to be clear why you are buying something. Is it for control, or because the acquired brands are in white spaces with unique strengths in the areas where we may not have adequate bandwidth or the capabilities to do what they are doing? We always go for the second strategy."

Recent Investment Focus

ITC's recent personal care investments have concentrated on the baby care segment through strategic partnerships with Mother Sparsh and Mylo. The company's investment approach demonstrates its commitment to building long-term value in specific categories.

Mother Sparsh, founded in 2016, has shown impressive growth trajectory with ITC as its first and only institutional investor. The baby care brand reported revenues of just under ₹ 100.00 crore in FY25, representing more than six times growth from FY21, while losses stood at ₹ 13.20 crore.

Market Dynamics and Competitive Landscape

India's personal care market presents significant growth opportunities, with projections showing expansion from $21 billion in 2023 to $34 billion by 2028. The overall market is growing at 10-11% compound annual growth rate, while online channels are expanding at approximately 25% CAGR.

Despite this growth potential, ITC maintains its measured approach. "The headroom to grow in personal care categories is enormous," Satpathy noted. "Some new brands enter categories but not everyone is able to sustain their presence."

Competitor Strategies

ITC's restrained strategy contrasts sharply with aggressive acquisition approaches adopted by listed rivals:

Marico's Digital Portfolio:

• Digital brands portfolio revenue: Over ₹ 1,000.00 crore
• Portfolio growth rate: 25% CAGR
• Key acquisitions: Beardo (stake 2017, full acquisition 2020), Plix, Just Herbs
• Just Herbs revenue: Crossed ₹ 100.00 crore last year

Hindustan Unilever's Major Acquisition:

• Minimalist acquisition: Just over ₹ 2,700.00 crore (all-cash deal)
• Market position: Leader in core soap categories

Current Market Position and Performance

ITC's personal care division has achieved notable digital penetration and premium positioning. E-commerce platforms now contribute 25% of the personal care division's total sales, while premium brands account for approximately 43-44% of the portfolio by value.

The company's major personal care brands have established strong market positions:

• Savlon: Estimated at about ₹ 1,000.00 crore in consumer spends
• Engage: Ranks second in fragrances market (behind Vini Cosmetics' Fogg)
• Fiama: Relatively smaller player in soaps segment, second in shower gels market

Financial Impact and Valuation

ITC's FMCG (Others) business, encompassing food and personal care, reported revenues of ₹ 11,859.56 crore in the first half of FY26 and ₹ 22,015.12 crore in FY25. However, the company's stock has faced pressure following government announcement of additional excise duty on cigarettes, with shares declining more than 20% over the past month.

J.P. Morgan's equities brokerage assigned specific valuations to ITC's business segments:

Satpathy emphasized that ITC's conservative approach has not hindered growth in digital channels, with the company maintaining "two distinct levers of growth—top of the pyramid and the bottom of the pyramid." Recent GST rate reductions are expected to benefit both premium and mass market segments, potentially accelerating growth across the personal care portfolio.

ITC Limited has announced the allotment of 2,69,610 ordinary shares under its Employee Stock Option Schemes on January 16, 2026. The allotment follows the exercise of stock options by eligible employees and represents the company's ongoing commitment to employee participation in its growth.

Share Allotment Details

The company issued and allotted 2,69,610 ordinary shares of ₹1.00 each following the exercise of 26,961 options by optionees under the Employee Stock Option Schemes. The allotment was completed on January 16, 2026, with the committee meeting concluding at 3:40 PM.

Impact on Share Capital

Following this allotment, ITC Limited's issued and subscribed share capital has increased significantly. The company's total share capital now stands at ₹1,252.92 crores, representing a substantial equity base.

Regulatory Compliance

The share allotment was conducted in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. ITC Limited has duly informed the stock exchanges about this corporate action to ensure transparency and compliance with regulatory requirements.

The communication was sent to both the National Stock Exchange of India Limited and BSE Limited, maintaining the company's commitment to proper disclosure practices. The allotment demonstrates ITC's structured approach to employee stock option schemes as part of its human resource management strategy.