British american tobacco FDI decision case study ,ximb-Batch of 2016

Case ofBritish ameriCan toBaCCo

Sathamchetty Balachander UM14049 Sourabh Ranjan Khuntia UM14055

Satyajit Patnaik UM14050 Sukanya Dash UM14056

Saurabh Arora UM14051 Sumukh Savanur UM14057

Shitika Ujjain UM14052 Sushree Sucharita Senapati UM14058

Shubham Mehra UM14053 Swagat Acharya UM14059

Sonia Chadha UM14054 Vijendra Kumar UM14060

FORMATION OF THE BRITISH AMERICAN TOBACCO COMPANY (BAT)

FROM BAT TO ITC Ltd.

Sourcing ,Marketing and Investments

Adjusting to situations and Import/Exports

• .

Investments in other industries

Investments in Social Sector

BAT’s Ownership

Year Foreign Institutional Indian PublicUntil 1953 100% --- ---1954-64 94% -- 6%1964-69 94% 1% 5%1969-74 75% 10% 15%1974-76 60% 18% 22%1984-85

38% 32% 30%

1985-86 31% 32% 36%2002-03 32.5% 38.38% 14.9%

ITC Equity Holding, 1953-2004

BAT/ITC Investments and Performance Indicators 1955-2004(in million INR)

* Refers to hotel business** Refers to packaged food business*** Refers to cigarette and tobacco business

Market Share ITC and Competitors, 1991-2003 (in million INR)

How did the business context change for BAT in India?

How has the FDI strategy of BAT been different from the general trend in FDI?

Does it make sense for an MNE to engage in the development effort of a

host country/government?

Integration Of Business Goals To National Goals

On what basis did BAT managers decide to give away their majority

ownership in ITC?

BAT’s Equity Dilution in the Indian Company

The Prevalent Industrial Scenario

Additional Factors

The Strategic Advantage of Equity Dilution in India

How were the FDI decisions of BAT/ITC managers driven by?

Drivers of FDI decisions of BAT/ITC Managers

ITC Equity Holding

What has been the key to success of BAT/ITC in India?

BAT/ITC's Key to Success

Were the decisions of BAT well planned out?

Evaluation of Decisions by BAT/ITC

Thank You!!!