ITC Ltd — Investor Presentation 2024

Dec 30, 2024

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ITC Limited Virginia House 37 J. L. Nehru Road Kolkata 700 071, India Tel. : 91 33 2288 9371 Fax : 91 33 2288 4016 / 1256 / 2259 / 2260

30[th] December, 2024

The Manager Listing Department National Stock Exchange of India Ltd. Exchange Plaza, Plot No. C-1, G Block Bandra-Kurla Complex Bandra (East) Mumbai 400 051

The General Manager Dept. of Corporate Services BSE Ltd. P. J. Towers Dalal Street Mumbai 400 001

The Secretary The Calcutta Stock Exchange Ltd. 7, Lyons Range Kolkata 700 001

Dear Sirs,

- Presentation on demerger of Hotels Business update

Further to our letter dated 25[th] November, 2024 enclosing a copy of the presentation on the Company’s Hotels Business (to be demerged into ITC Hotels Limited), we enclose herewith an update on the said presentation.

Copy of the said update also being hosted on the Company’s corporate website www.itcportal.com .

Yours faithfully, ITC Limited

RAJENDR Digitally signed by RAJENDRA A KUMAR KUMAR SINGHI Date: 2024.12.30 SINGHI 15:06:17 +05'30'

(R. K. Singhi) Executive Vice President & Company Secretary

Encl: as above

FMCG ⚫ HOTELS ⚫ PAPERBOARDS & PACKAGING ⚫ AGRI-BUSINESS ⚫ INFORMATION TECHNOLOGY Visit us at www.itcportal.com ⚫ Corporate Identity Number : L16005WB1910PLC001985 ⚫ e-mail : enduringvalue@itc.in

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cc: Securities Exchange Commission Division of Corporate Finance Office of International Corporate Finance Mail Stop 3-9 450 Fifth Street Washington DC 20549 U.S.A. cc: Societe de la Bourse de Luxembourg 35A Boulevard Joseph II L-1840 Luxembourg

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Update on Demerger of Hotels Business Investor Presentation

30[th] December, 2024

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Forward-Looking Statements

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This presentation contains certain forward-looking statements including those describing the Company’s strategies, strategic direction, objectives, future prospects, estimates etc. Investors are cautioned that “forward looking statements” are based on certain assumptions of future events over which the Company exercises no control. Therefore there can be no guarantee as to their accuracy and readers are advised not to place any undue reliance on these forward looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. These statements involve a number of risks, uncertainties and other factors that could cause actual results or positions to differ materially from those that may be projected or implied by these forward looking statements. Such risks and uncertainties include, but are not limited to: growth, competition, acquisitions, domestic and international economic conditions affecting demand, supply and price conditions in the various businesses in the Company’s portfolio, changes in Government regulations, tax regimes and other statutes, and the ability to attract and retain high quality human resource.

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Timeline Update

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• Certified copy of the Order of Hon’ble National Company Law Tribunal (‘NCLT Order’), Kolkata Bench, sanctioning the Scheme, received on December 16, 2024

• ITC and ITC Hotels mutually acknowledged that all conditions specified in Clause 28 of the Scheme have been satisfied, including filing of the NCLT Order with the Registrar of Companies, West Bengal

• Appointed Date and Effective Date of the Scheme to be January 1, 2025

• Record Date fixed as January 6, 2025 for purposes of determining the shareholders of ITC to whom equity shares of ITC Hotels would be allotted pursuant to demerger

• ITC Hotels to file application with Stock Exchanges/ SEBI for listing its shares, post allotment

• Shares to be listed within 60 days from date of receipt of NCLT Order (i.e. December 16, 2024) as per SEBI Master Circular dated June 20, 2023

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Transaction Structure Recap

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Demerger

Resultant Structure

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Shareholders 1 Share of ITC Hotels Shareholders
~60%
for every
100%
10 shares of ITC
100%
100%
~40%
ITC ITC Hotels ITC ITC Hotels
TSO [1] : 1,251 Cr TSO [1] – 83 Cr TSO [1] : 1,251 Cr TSO [1] – 208 Cr
FMCG, Cigarettes, FMCG, Cigarettes,
Paperboards & Hotel Business Paperboards & Hotel Business
Packaging, Agri, IT Packaging, Agri , IT
Demerger
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Transaction Overview

• Demerger of ITC’s Hotel Business into ITC Hotels through a Scheme of Arrangement approved by National Company Law Tribunal

Appointed Date/ Effective Date: January 1, 2025 | Record Date: January 6, 2025

• ITC Hotels to issue equity shares directly to the shareholders of ITC in a manner that about 60% stake is held directly by ITC shareholders proportionate to their shareholding in ITC and remaining about 40% stake to continue with ITC

• Overall, existing ITC shareholders will hold 100% of ITC Hotels, i.e. about 60% directly and balance of about 40% through their shareholding in ITC

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1TSO: Total shares outstanding

(1/2)

Transaction Perimeter – key updates

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Intellectual property/ trademarks exclusively used in relation to Hotels Business being transferred to ITC Hotels

ITC and ITC Hotels to execute a Trademarks License Agreement under which ITC Hotels would be given a license to use:

• the ‘ITC’ trademark/ logo/ label/ wording, along with any copyrights derived from such Trademark; and

• the ‘Bukhara’, ‘Dum Pukht’ & ‘Dakshin’ trademarks/ logos/ labels/ wordings, along with any copyrights derived from such Trademarks

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Properties, assets, investments, employees, liabilities & contracts forming part of Hotels Business being transferred

• Operating Service Agreement to be executed between ITC and ITC Hotels to operate & manage ITC Grand Central, Mumbai

• Identified assets such as offices, managerial/ staff housing, etc. pertaining to Hotels Business being transferred to ITC Hotels

• Cash & cash equivalents of Rs. 1500 cr. to cater to planned growth & contingency requirements

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(2/2)

Transaction Perimeter – key updates

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Investments in Hospitality Entities, forming part of Hotels Business, being transferred to ITC Hotels

• Hospitality Entities: Bay Islands Hotels Ltd.; Fortune Park Hotels Ltd.; Landbase India Ltd.; Srinivasa Resorts Ltd.; WelcomHotels Lanka Pvt. Ltd.; Gujarat Hotels Ltd.; International Travel House Ltd.; Maharaja Heritage Resorts Ltd.

• Financial Investments (EIH Ltd. & HLV Ltd.) and non-operational investments (Logix Developers Pvt. Ltd.) not being transferred, as envisaged in the Scheme

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Employees engaged in/ related to Hotels Business being transferred to ITC Hotels

• Employment terms to be no less favourable than their existing terms of employment with ITC

• Transferred employees to become employees of ITC Hotels with continuity of service

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• Transition Service Agreement being signed by ITC and ITC Hotels – Accounting, Tax, Legal, Secretarial, IT etc.

• All Related Party Transactions will be undertaken on arm’s length basis

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Strategy Pillars

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CONTINUED INVESTMENT
CAPITAL
TO ENHANCE BRAND ASSET RIGHT DIGITAL FIRST EMPLOYER OF CHOICE
PRODUCTIVITY
EQUITY
Key Differentiators
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• Indigenous Experiences ■ Bouquet of brands catering ■ Smart Revenue

• ■ Signature cuisines to relevant need spaces Management

• Responsible Luxury ■ Target to achieve 2/3rd ■ Customer intimacy

• ■ World Class Loyalty Managed portfolio share in ■ Productivity and next 5 years

• Programs – Club ITC & efficiency Club ITC Culinaire

• Customer intimacy

• Strong Talent Pool

• Sweating existing assets

• Augment new revenue ■ Robust L&D programmes streams ■ D & I amongst best in

• ■ Extreme Cost and Margin industry focus

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Strong Growth Enablers in Place

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Strong Zero Debt Balance Sheet & Cash Generation to accelerate growth

Capital Investments → Renovations | on-going Projects | new Greenfields & others

• Estimated at c.8-10% of Revenue cumulatively

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Well positioned to execute selective Inorganic Opportunities

• Value accretive M&A | Alliances

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Driving Capital Efficient Growth

Owned Hotels

• Significant headroom to drive RevPar growth

• About 20% Inventory < 5 years old, operating at 75% of potential Occupancy levels

• ITC Ratnadipa, Colombo → significant contributor to Revenue & EBITDA going forward

Upcoming projects

• 300+ rooms[#] being planned under Owned Hotels

• Greenfield project at Puri; Expansion at Bhubaneshwar

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Welcomhotel Puri
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118 Keys by FY28

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Welcomhotel Bhubaneshwar
100+ Keys
12k sqft. banquets expansion
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• Leverage strategic Land Bank

• # including 102 rooms at ITC Ratnadipa, Colombo

Managed Hotels

• Increased interest among Asset Owners

• Robust pipeline of 45 Managed Hotels with about 4000 Keys

• 2.5x growth targeted in Management Fees by FY30

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Robust Growth Pipeline: 46 Hotels with ~4300 Keys

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1 Hotel 13 Hotels 10 Hotels 18 Hotels 4 Hotels
223 Keys [#] 1796 Keys 578 Keys 1439 Keys 162 Keys
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• Opened 28 Managed Hotels in the past 24 months (Nov 2022 – Oct 2024)

• High Quality of signed pipeline ; High salience of Brownfield Assets

• > 1 Hotel opening per month for next 24 months

• Leverage momentum to accelerate further

• Targeting 200+ hotels with 18000+ keys over 5 years , with 2/3[rd] salience of Managed Portfolio

# includes proposed expansion at Mementos Jaipur by 100 keys

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Unlocking Full Potential of Recent Launches

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ITC Narmada (FY23)
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ITC Royal Bengal (FY20)
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WH Bhubaneswar (FY22)
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ITC Ratnadipa (FY25)
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Significant headroom for growth

About 20% Inventory operating at 75% of potential Occupancy levels

Significant contributor to Revenue & EBITDA in the years ahead

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ITC Ratnadipa, Colombo A Jewel in Colombo’s Skyline

One of its Kind Mixed Use Development 352 Hotel Keys + 132 Luxury Apartments

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71,000 sqft. 9 Retail & Office Spaces Signature Dining 40,000 sqft. Destinations Banqueting Spaces Sale of Investment Outlay Sapphire Residences[#] Substantially underway Completed (7.3 lakh sqft.) ITC Ratnadipa, Colombo

# Deliveries to commence in 2025

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Sapphire Residences, Colombo

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Unique luxury apartments with interiors designed by Philippe Starck (YOO) Most Exclusive and Spacious Elevated living experience in Sri Lanka Located at epicentre of Galle Face Oceanfront

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THANK YOU

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Annexure: Pro forma Financials of ITC Hotels

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Particulars (in Rs. cr.)	H1 FY25	FY24	FY23	FY22
Revenue from Sale of Products and Services	1457	3003	2599	1308
Other Operating Revenue	15	31	30	12
Revenue From Operations	1471	3034	2629	1320
Other Income	17	35	24	24
Total Income	1489	3069	2654	1344
Cost of Goods Sold	164	296	265	148
Employee Benefits Expense	323	586	541	461
Finance Costs	3	7	7	7
Depreciation and Amortization expense	200	298	292	264
Other Expenses	571	1147	1015	639
Total Expenses	1261	2335	2121	1519
EBITDA	413	1004	808	71

Notes

1. Above represents Consolidated Financial Statements of Hotels Business, excluding ITC Grand Central, Mumbai

2. Amounts rounded off

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