ITC bets on AI-first backbone to power factories, farms

What happened

Puri’s address offered a view of AI not as an isolated digital initiative, but as an operating layer that could improve how ITC understands consumers, runs factories, manages supply chains and works with farmers. Calling for Indian enterprises to become future-ready and globally competitive, Puri identified capabilities for “AI-led transformation” alongside investments in research, innovation, trusted domestic brands and national manufacturing assets.

For enterprise technology leaders, the strategic signal is important: ITC appears to view AI infrastructure as part of the manufacturing asset itself, rather than as a separate technology overlay introduced after plants are commissioned. AI is also becoming central to ITC’s FMCG portfolio strategy. Puri said the company had developed an AI-led consumer insight ecosystem that enables targeted micro-segmentation. Such capabilities are particularly relevant as Indian consumption becomes more fragmented.

Why it matters

The broader argument was that competitiveness in an increasingly volatile world would depend not merely on efficiency, but on the ability of enterprises to build resilience, develop new capabilities and convert disruption into fresh growth opportunities. ITC described this approach as “Responsible Competitiveness”, combining economic scale with locally anchored value chains, sustainability and inclusion.

Puri said the company was creating an “AI-first digital backbone” across its manufacturing facilities to improve efficiency, cost optimisation and responsiveness. ITC currently operates a manufacturing ecosystem of more than 300 factories, including 45 owned plants, and works with over 9,500 micro, small and medium enterprises. Nearly 90 per cent of the company’s value addition takes place in India. The scale of this network makes the manufacturing deployment significant.

However, the chairman’s address did not provide details about the underlying technology architecture, specific AI models, implementation partners or the proportion of capital expenditure allocated to AI. ITC has proposed a medium-term group capital expenditure of ₹20,000 crore, with six new projects in the pipeline following the commissioning of eight facilities.

What to watch

The company’s portfolio now comprises more than 30 FMCG brands, representing annual consumer spending of nearly ₹37,000 crore. These brands reach approximately 280 million households and are exported to more than 70 countries. ITC estimates that its addressable FMCG market could reach around ₹8 lakh crore by 2035. At this scale, AI-led segmentation can potentially influence decisions ranging from product formulation and packaging to pricing, channel selection and inventory planning.

Puri highlighted ITC’s growing presence in nutrition, wellness, naturals, fresh food and convenience-led categories. The strategy reflects an attempt to combine the speed and category focus of start-ups with ITC’s distribution, research and institutional capabilities. 6 million farmers across 11 states. The company also plans to use the platform to build a “Farming as a Service” ecosystem.