ITC-A EVERGREEN BLUE CHIP

ITC is in the business of tobacco,Hotels,Paper,Biscuits and a host of other business.The company is using its free cash flow generated from its existing business to aggresively expand its Non-Tobacco business.The company is building new hotels,expanding its paper boards and printing business and also aggresively growing in its biscuits business.Imagine in a business dominated by Brittania for decades,ITC has already got over 8% market share in a short span of time.

But the most interesting aspect of ITC's dream is the e-choupal intiative whereby the company is bringing the rural India into its growth strategy.In what must be the most ambitious plans for any private sector co,ITC is planning to connect more than 1,00,000 villages in the country through this intiative.The e-choupal intiative will ultimately enable the company to source goods from the rural place to sell in the urban areas.The company also sells various things like Fertilisers,Fast moving consumer goods to the rural market.This I believe will eventually create the best retail model in the country.

For the year ended 2007 the company will end up recording a turnover of over Rs.20,000 crores and a net profit of over Rs.2500 crores.Virtually a debt free co with professional managment the co is in the right businesses to capture the India Story.At a price of Rs.185 the share is traded at a P/E of slightly over 23 times.Considering the growth plans the share may be accumulated to give excellent returns in the long run.Investors investing with a long term view will get atleast 20% tax free returns year on year for the next 5 years.A must share in everybody's portfolio.