MIRA
INFORM REPORT
|
Report Date : |
11.07.2012 |
IDENTIFICATION DETAILS
|
Name : |
TATA GLOBAL BEVERAGES LIMITED (w.e.f. 02.07.2010) |
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Formerly Known
As : |
TATA TEA LIMITED |
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Registered
Office : |
1, |
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Country : |
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Financials (as
on) : |
31.03.2011 |
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Date of
Incorporation : |
18.10.1962 |
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Com. Reg. No.: |
031425 |
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Capital
Investment / Paid-up Capital : |
Rs. 618.399 millions |
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CIN No.: [Company Identification
No.] |
L15491WB1962PLC031425 |
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|
Legal Form : |
Public Limited Liability Company, Company's Shares are Listed on Stock
Exchange |
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Line of Business
: |
Manufacturer of Tea |
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No. of Employees
: |
Not Available |
RATING & COMMENTS
|
MIRA’s Rating : |
Aa (76) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
Maximum Credit Limit : |
USD 82258104 |
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Status : |
Excellent |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a subsidiary of the Tata Group. It is a global beverage business
and the worlds second largest tea company. It is an old and well established
reputed company having excellent track records. Financial position of the
company appears to be strong. Directors are reported as experienced and
knowledgeable businessmen. Trade relations are reported as praiseworthy. Business is active.
Payments are reported to be regular and as per commitments. The company can be considered best for business dealings at usual
trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com while quoting report number, name and date.
ECGC Country Risk Classification List – March 31st, 2012
|
Country Name |
Previous Rating (31.12.2011) |
Current Rating (31.03.2012) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
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Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
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Restricted |
C2 |
|
Off-credit |
D |
LOCATIONS
|
Registered Office : |
1, Bishop Lefroy Road, Kolkata 700020, West Bengal, India |
|
Tel. No.: |
91-33-22811807 / 3709 / 3779 / 3891 / 4422 |
|
Fax No.: |
91-33-22811199 |
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E-Mail : |
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Website : |
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Plant locations : |
a) Survey No. 14/4,A2 and 14/5, NH 4, Bangalore Tumkur Road, Malonagathi
Hally, T. Begur Post, Nelamangla Taluk, Bangalore Rural District, Karnataka –
562 123, India b) Periakanal Estate, PO Munnar, Dist. Idukki, Kerala – 685 612, India
c) Pullivasal Estate and Packeting centre - PO Munnar, Dist.Idukki,
Kerala – 685 612, India d) Instant Tea Operations, Post Box No. 3, Idukki district, Munnar,
Kerala – 685 612 (including Nullatani factory) e) Tata Tetley Division: 73 KPK Menon Road; Willingdon Island, Kochi,
Kerala – 682 003 and an extension unit at 40, Milne Road, Willingdon Island,
Kochi, Kerala – 682 003, India |
DIRECTORS
AS ON 31.03.2011
|
Name : |
Mr. R N Tata |
|
Designation : |
Chairman |
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|
Name : |
Mr. R K Krishna Kumar |
|
Designation : |
Vice-Chairman |
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Name : |
Mr. F K Kavarana |
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Designation : |
Director |
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Name : |
Mr. U M Rao |
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Designation : |
Director |
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Name : |
Mr .A R Gandhi |
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Designation : |
Director |
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Name : |
Mrs. M Srinivasan |
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Designation : |
Director |
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Name : |
Mr. A Singh |
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Designation : |
Director |
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|
Name : |
Mr. J S Bilimoria |
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Designation : |
Director |
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Name : |
Mr. V Leeladhar |
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Designation : |
Director |
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Name : |
Mrs. Ranjana Kumar |
|
Designation : |
Director |
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|
Name : |
Mr. Ajay Shankar (joined from 30.4.2010) |
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Designation : |
Director |
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|
Name : |
Mr. P D Unsworth (up to 30.6.2011) |
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Designation : |
Director |
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Name : |
Mr. P T Siganporia |
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Designation : |
Managing Director |
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Name : |
Mrs. S Talwar |
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Designation : |
Whole-time Director) (up to 30.7.2010 |
KEY EXECUTIVES
|
Name : |
Mr. V Madan |
|
Designation : |
Vice President and Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 31.03.2012
|
Category of
Shareholder |
Total No. of
Shares |
% of total No.
of Shares |
|
|
|
As a % of
(A+B+C) |
|
(A) Shareholding
of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
217,683,190 |
35.20 |
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|
217,683,190 |
35.20 |
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|
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Total
shareholding of Promoter and Promoter Group (A) |
217,683,190 |
35.20 |
|
(B) Public
Shareholding |
|
|
|
|
|
|
|
|
25,633,420 |
4.15 |
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|
100,587,163 |
16.27 |
|
|
5,850 |
- |
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|
31,525,842 |
5.10 |
|
|
94,107,639 |
15.22 |
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|
251,859,914 |
40.73 |
|
|
|
|
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|
14,436,821 |
2.33 |
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|
|
|
|
|
125,442,097 |
20.28 |
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|
4,779,680 |
0.77 |
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|
4,052,743 |
0.66 |
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|
3,292,073 |
0.53 |
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|
508,280 |
0.08 |
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|
180,390 |
0.03 |
|
|
62,000 |
0.01 |
|
|
3,500 |
- |
|
|
6,500 |
- |
|
|
148,711,341 |
24.05 |
|
Total Public shareholding
(B) |
400,571,255 |
64.78 |
|
Total (A)+(B) |
618,254,445 |
99.98 |
|
(C) Shares held
by Custodians and against which Depository Receipts have been issued |
- |
- |
|
|
- |
- |
|
|
144,125 |
0.02 |
|
|
144,125 |
0.02 |
|
Total
(A)+(B)+(C) |
618,398,570 |
100.00 |
(1) Indian
Bodies Corporate
Individual shareholders holding nominal
share capital up to Rs. 0.100 millionBUSINESS DETAILS
|
Line of Business : |
Manufacturer of Tea |
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Products : |
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PRODUCTION STATUS
AS ON 31.03.2011
|
Particulars |
Unit |
Actual
Production |
|
Tea * |
Kgs. in Millions
|
87.678 (Excluding free
issues to labour and samples) 0.495 |
* Includes production through contract packers
68.172 millions Kgs.
GENERAL INFORMATION
|
No. of Employees : |
Not Available |
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Bankers : |
·
AXIS Bank Limited ·
Bank of America ·
Bank of Baroda ·
Citibank N.A. ·
Deutsche Bank ·
HDFC Bank Limited ·
ICICI Bank
Limited ·
Standard
Chartered Bank ·
State Bank of
India ·
State Bank of
Travancore ·
The Hongkong and
Shanghai Banking Corporation Limited ·
The Royal Bank of
Scotland N.V. ·
Yes Bank Limited |
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Facilities : |
Rs. In Millions
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Banking
Relations : |
-- |
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Auditors : |
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Name : |
N M Raiji and Company Chartered Accountant |
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Subsidiaries: |
·
Tata Global Beverages
Group Limited (formerly Tata Tea GB Limited) ·
Alliance Coffee
Limited ·
Tata Global
Beverages Holdings Limited (formerly Tetley Group Holdings Limited) ·
Tata Tea
Extractions Inc (formerly Tata Tea Inc.) ·
Tata Global
Beverages Services Limited (formerly The Tetley Group Limited, UK) ·
Tata Global
Beverages Capital Limited (formerly Tata Tea (GB) Capital Limited) ·
Tata Global
Beverages GB Limited (formerly Tetley GB Limited) ·
Mount Everest
Mineral Water Limited ·
Tata Global Beverages
Overseas Holdings Limited ·
(formerly Tetley
Overseas Holdings Limited) ·
Zhejiang Tata Tea
Extraction Company Limited ·
Tata Tea Holdings
Private Limited ·
Tata Global
Beverages Overseas Limited (formerly Tetley Overseas Limited) ·
Lyons Tetley
Limited ·
Tata Coffee
Limited ·
Consolidated
Coffee Inc. ·
Eight ‘O Clock
Coffee Company ·
Tata Global Beverages U.S. Holdings, Inc.
(formerly Tetley US Holdings Inc.) ·
Tetley USA Inc. ·
Tata Global Beverages Canada Inc. (formerly
Tetley Canada Inc.) ·
Tata Global Beverages Australia Pty. Limited
(formerly Tetley Australia Pty. Limited) ·
Stansand Limited ·
Stansand (Brokers) Limited ·
Stansand (Africa) Limited ·
Stansand (Central Africa) Limited ·
Tata Global Beverages Polska sp. zo.o (formerly
Tetley Polska sp. zo.o) ·
Drassington Limited UK ·
Good Earth Corporation ·
Good Earth Teas Inc. ·
Teapigs Limited ·
Tata Global Beverages Czech Republic a.s.
(formerly Jemca a.s.) ·
Joekels Tea Packers (Proprietary) Limited (South
Africa) ·
Tata Global Beverages Investments Limited
(formerly Tata Tea (GB) Investments Limited) ·
Campestres Holdings Limited ·
Kahutara Holdings Limited ·
Suntyco Holding Limited ·
Onomento Company Limited ·
OOO Tea Trade LLC ·
OOO Sunty LLC |
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Joint Ventures: |
Nourish Company Beverages Limited |
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Associates : |
·
Estate Management
Services Private Limited, Sri Lanka ·
Watawala
Plantations Limited, Sri Lanka ·
Amalgamated
Plantations Private Limited |
CAPITAL STRUCTURE
AS ON 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
750000000 |
Equity Shares |
Re. 1 each |
Rs. 750.000 millions |
Issued, Subscribed & Paid-up Capital * :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
618398570 |
Equity Shares |
Re. 1 each |
Rs. 618.399 millions |
Of the above,
a) 7,23,80,730
Shares were allotted as fully paid pursuant to a contract without payment being
received in cash
b) 33,18,06,740 Shares were allotted as fully paid Bonus Shares by capitalisation of General Reserve and Securities Premium Account
* With effect from record date 2 July 2010,
the face value of the Company’s shares have been subdivided from Rs. 10 per
share to Re. 1 per share.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
618.399 |
618.399 |
618.399 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
19946.127 |
20160.018 |
17374.755 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
20564.526 |
20778.417 |
17993.154 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
5054.683 |
4964.450 |
4453.603 |
|
|
2] Unsecured Loans |
0.000 |
32.143 |
3096.429 |
|
|
TOTAL BORROWING |
5054.683 |
4996.593 |
7550.032 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
38.000 |
|
|
|
|
|
|
|
|
TOTAL |
25619.209 |
25775.010 |
25581.186 |
|
|
|
|
|
|
|
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APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1120.191 |
1057.935 |
970.576 |
|
|
Capital work-in-progress |
30.292 |
55.702 |
68.984 |
|
|
|
|
|
|
|
|
INVESTMENT |
22909.071 |
23090.492 |
20736.743 |
|
|
DEFERREX TAX ASSETS |
87.975 |
8.203 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
4299.116
|
3781.381 |
2911.031 |
|
|
Sundry Debtors |
1018.966
|
1163.909 |
918.444 |
|
|
Cash & Bank Balances |
68.722
|
53.604 |
456.495 |
|
|
Other Current Assets |
57.757
|
89.744 |
3061.878 |
|
|
Loans & Advances |
1460.326
|
1363.662 |
979.781 |
|
Total
Current Assets |
6904.887
|
6452.300 |
8327.629 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
2852.981
|
2737.798 |
2842.361 |
|
|
Other Current Liabilities |
801.509
|
261.387 |
263.281 |
|
|
Provisions |
1778.717
|
1890.437 |
1493.057 |
|
Total
Current Liabilities |
5433.207
|
4889.622 |
4598.699 |
|
|
Net Current Assets |
1471.680
|
1562.678 |
3728.930 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
75.953 |
|
|
|
|
|
|
|
|
TOTAL |
25619.209 |
25775.010 |
25581.186 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Sales |
17926.217 |
16979.226 |
13615.285 |
|
|
|
Other Income |
187.894 |
176.900 |
177.178 |
|
|
|
Investment Income |
1028.824 |
1212.301 |
1453.902 |
|
|
|
TOTAL (A) |
19142.935 |
18368.427 |
15246.365 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Purchases |
10.349 |
15.691 |
44.793 |
|
|
|
Cost of Materials |
10911.604 |
9938.266 |
7859.879 |
|
|
|
Accretion to Stock |
(257.820) |
(146.877) |
(186.720) |
|
|
|
Administrative Expenses |
5992.611 |
5434.461 |
4549.408 |
|
|
|
TOTAL (B) |
16656.744 |
15241.541 |
12267.360 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
2486.191 |
3126.886 |
2979.005 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
291.810 |
450.602 |
485.973 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
2194.381 |
2676.284 |
2493.032 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
123.558 |
123.241 |
106.492 |
|
|
|
|
|
|
|
|
|
|
Exceptional
Income |
232.948 |
(2401.279) |
95.925 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
2303.771 |
4954.322 |
2290.615 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
497.920 |
1039.620 |
700.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
1805.851 |
3914.702 |
1590.615 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
3462.589 |
1580.654 |
1702.483 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to Debenture Redemption Reserve |
0.000 |
210.000 |
300.000 |
|
|
|
Transfer to General Reserve |
180.600 |
391.500 |
159.100 |
|
|
|
Dividend |
1236.797 |
1236.797 |
1082.197 |
|
|
|
Tax on Dividend |
178.558 |
194.470 |
171.147 |
|
|
BALANCE CARRIED
TO THE B/S |
3672.485 |
3462.589 |
1580.654 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
1555.648 |
1555.884 |
1367.307 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
362.559 |
354.887 |
305.589 |
|
|
|
Stores & Spares |
186.876 |
164.010 |
198.998 |
|
|
|
Capital Goods |
0.723 |
102.378 |
7.367 |
|
|
TOTAL IMPORTS |
550.158 |
621.275 |
511.954 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
2.92 |
6.33 |
-- |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 |
30.09.2011 |
31.12.2011 |
31.03.2012 |
|
|
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
4th
Quarter |
|
Net Sales |
5194.600 |
5111.300 |
5305.100 |
4741.900 |
|
Total Expenditure |
4592.800 |
4602.400 |
4654.600 |
4218.200 |
|
PBIDT (Excl OI) |
601.800 |
508.900 |
650.500 |
523.700 |
|
Other Income |
64.600 |
272.500 |
434.900 |
76.100 |
|
Operating Profit |
666.400 |
781.400 |
1085.400 |
599.800 |
|
Interest |
14.900 |
14.600 |
45.900 |
72.900 |
|
Exceptional Items |
1096.000 |
(34.400) |
(139.200) |
(87.500) |
|
PBDT |
1747.500 |
732.400 |
900.300 |
439.400 |
|
Depreciation |
30.500 |
29.400 |
28.600 |
31.900 |
|
Profit Before Tax |
1717.000 |
703.000 |
871.700 |
407.500 |
|
Tax |
72.100 |
198.400 |
287.500 |
114.300 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
1644.900 |
504.600 |
584.200 |
293.200 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
0.000 |
|
Net Profit |
1644.900 |
504.600 |
584.200 |
293.200 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
9.43
|
21.31 |
10.43 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
12.85
|
29.17 |
16.82 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
28.70
|
65.96 |
24.63 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.11
|
0.23 |
0.12 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.50
|
0.47 |
0.67 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.27
|
1.31 |
1.81 |
LOCAL AGENCY FURTHER INFORMATION
FINANCIAL
HIGHLIGHTS
The Company was able to implement price increases in selective
categories, to recover a significant part of the input cost increases during
the year. The Company performed creditably in a difficult year, maintaining
volume leadership in India, with the key brands recording impressive growth.
The Company continued to invest behind its brands and aggressively pursue its
innovation agenda by introducing new health and wellness products and creating
different ways of increasing the consumption of tea at various price points.
Total income for 2010/11 at Rs. 19140 millions registered a four per cent
increase over the previous year, attributable to improved branded tea business
aided by price increases and volume improvements. Profit before tax and
exceptional items at Rs. 2070 millions was lower due to input cost increases
and increased spend on brand building. Exceptional items in the previous year
included significant profits from sale of investments. Profit after tax at Rs.
1810 millions, also reflects this lower profits from the sale of investments
compared with the previous year.
Review of Activities
The Indian Tea
Industry
Fiscal 2010/11 was another good year for the Indian Tea Industry, which
witnessed strong commodity prices on the back of buoyant domestic demand
estimated at 3 per cent to 4 per cent. All India crop was lower than the
previous year by 12.50 M kgs largely due to adverse climatic conditions. The
markets experienced a significant rise in price levels from August 2010 onwards
due to the loss of crop attributed to excessive rain and pest attacks and the
consequence of this was lower exports compared to the previous year.
Domestic Branded
Tea Operations
The company’s key domestic brands such as Tata Tea Premium and Chakra Gold
performed well during the year under review. The branded business reported a
value growth of 6 per cent and a volume growth of 2 per cent over the previous
year. Tata Tea Gold continued its robust growth story with a 10 per cent volume
growth over previous year, backed by a successful consumer promotion that
brought new trials for the brand. Their flagship brand, Tata Tea Premium, made
a strong recovery, buoyed by a successful restage and key initiatives
undertaken on the brand which included introduction of a new pack face, a fresh
proposition driven primarily by a new TV campaign and massive ground level
activation.
Their strong brand, in the value segment, Tata Tea Agni, saw robust
growth and was 8 per cent ahead in volume terms over the previous year. The 25
Years celebration of Kanan Devan was supported by media advertising with the
strapline “Winning challenges with a smile for 25 years” and received a
positive response from customers and consumers. Chakra Gold launched a new
thematic campaign which strengthens the “open up the mind” proposition that has
helped increase the positive disposition of the brand among users of
competitive products. Tetley experienced continuous on ground activation
coupled with a new global brand proposition and product extensions, which led
to the most profitable year for the brand since its launch in India. The
influential Jaago Re Campaign continued, and a new film was launched which
focused on corruption in the education system. This was supported by
www.jaagore.com, an online portal that aims to connect the concept of ‘Social
Awakening’ to reality. The portal seeks to herald a new movement of change by
providing a common platform for exchange of ideas and resources between
citizens and social change agents – both NGOs and individuals. A first in
India, the portal has 6.2 Lakh registered users since it was first launched in
2008. There are 170 NGOs, 340 volunteering opportunities and an average of 100
volunteers per month. In a challenging market environment they are very pleased
that the Company maintained its volume leadership in the tea market in India.
While the environment will continue to witness competitive pressures, the
Company is developing a fresh strategy to counter competition in the branded
tea sector in India. To start with, the Company is conducting a host of market
activation programmes and on-ground promotions to promote all its brands across
the country. The Company also plans to refresh and relaunch its tea brands with
a view to attract new consumers.
International
Branded Operations
The global Tetley brand was revitalised during the year, with a strong
and renewed focus which will be at the heart of the brand’s ongoing growth
agenda. Building on its strong heritage, the Tetley brand continues to develop
a broad range of new and exciting teas to suit all cultures, tastes and moods
in a variety of formats around the world, particularly for non-black tea
variants such as Redbush and Green. The Group continues to focus on
geographical expansion as well as widening its brand and product portfolio.
Some of the key initiatives taken in 2010/11 included the test launch of SUKK
(a jelly based drink) and T4 Kidz and Tetley Soya in the UK; Tetley for Soy,
Billy Campfire and Kitchen Brew variants in Australia and the launch of their
products in the Middle East. They continued the emphasis on the speciality
category in the UK and Tetley Infusions in Canada, with the launch of two new
flavours. Further initiatives are under way for breakthrough innovation in their
key strategic growth areas of health and wellness, convenience and
sustainability. Following the decision taken to move to Rainforest Alliance
certification of all Tetley products by 2016, the first certified consumer
products have appeared on the shelf. Farmer’s First Hand, a web-based
promotional activity on Facebook, is being used to support the transition to
Rainforest Alliance Certified Tea.
Plantation
Operations
Crop production for the year ended 31 March 2011 at the Company’s
Pullivasal and Periakanal Estates was 1.979 millions kgs against the previous
year crop of 2.194 millions kgs. The yield achieved was lower by 10 per cent
due to unfavourable weather conditions. The productivity achieved by Pullivasal
and Periakanal estates to end 31 March 2011 was 50.65 kgs against 51.70 kgs
achieved for the same period of the previous season. The combined productivity
achieved by these two estates during the year is the second highest while the
plucking average of 51.46 kg achieved by Pullivasal Estate is an all time
record. Kanan Devan Hills Plantations Private Limited (KDHP) has completed the
sixth consecutive year of strong performance and has underscored the strong
fundamentals of the unique business model of employee empowerment practiced in
the company. Though the operations of the year gone by were affected by adverse
weather conditions and softening of prices for teas produced in South India, it
still posted excellent financial results, second only to the record results for
the year ended 31 March 2010. With representation from all sections of the
employees on its Board as well as following a participatory nature of
management, KDHP has excelled in creating a unique self sustaining model for
the company. With over 11,000 employees spread over 7 estates and 16 factories,
it has now transformed itself into the largest Tea producing company in South
India.
MANAGEMENT
DISCUSSION AND ANALYSIS
Executive Overview
Tata Global Beverages is a virtually integrated beverage business with the
vision to be a global leader in branded “good-for-you” beverages, through
disruptive innovation, strategic acquisitions and organic growth. The new name
of the Company, adopted in July 2010, united the beverage interests of the Tata
Beverage Group under one umbrella and signalled its global ambition. The
company’s markets and operations are truly global, with 70% of turnover now
generated outside of India, up from 65% in the prior year. The coining of Tata
Global Beverages was the logical step in the Group’s evolution from its history
in tea plantations to becoming a marketing and brand-focused organisation. It
is no longer a tea and coffee commodity business - over 90% of their sales
today are from branded products. The company has a portfolio of global and
regional beverage brands, which they develop, market and distribute to
customers. During the year, the Company continued its exciting transformation.
The company’s raison d’etre was established and it has set out “to make the
world a better place through sustainable hydration”. The company’s strategy to
achieve this mission is based on six pillars - products, brands, distribution,
people, process and sustainability. The culture and values of Tata Global
Beverages add up to something unique that can be crystallised as a sense of
”responsible irreverence”.
Industry Structure
and Developments
Tea and coffee continue to be enjoyed by consumers in many countries
around the world. The company possesses strong, established brands in both
categories that enable it to capture a sizeable proportion of the global tea
and coffee market. A strong trend is evolving as part of the consumer’s health
and wellness agenda towards “good-for-you” beverages, differentiated by
function, flavor and format. The Company is on its way to seizing and fuelling
this trend, such as through innovative tea variants and through alliances with
third parties who have specific expertise. Furthermore, sustainability and
environmental concerns are playing a greater role in the business of consumer
brands. The company has embedded sustainability into its mission statement and
roadmaps are now in place to tackle the issues of packaging, ethical sourcing,
water and climate change. They have committed to source 100 per cent of their
key agricultural raw materials and packaging components from sustainable
sources and ensure that no packaging goes to landfill by 2015. They are also
working towards better understanding the Group’s water footprint and committed
to reducing carbon emissions. In terms of the company’s supply chain, tea crop
in India which saw a strong start in 2010 however ended lower than the previous
year due to the impact of adverse climatic conditions both in South and North
India besides pest attacks in certain parts of tea growing areas. The crop at
966.2 M kgs in 2010 was lower than the previous year by 12.50 M Kgs .The lower
crop further impacted the export of teas from India. India exported 193.29 M
kgs in 2010 as compared to 200.62 M kgs in 2009. Domestic demand for teas grew
by three per cent to four per cent and coupled with the lower supply led to
increase in raw tea prices. In the current year, there were good rains in the
tea growing districts of Assam and the crop situation looks good. The market
remained firm with mostly clean, old season teas being well competed for.
Quality teas are expected to witness good demand from the domestic markets and
continue to sell at a premium while medium / plainer varieties for both
Orthodox / CTC’s should sell in line with quality. The outlook is for a dearer,
strong market as new season’s teas go on sale. In contrast, the markets in
South India are witnessing a weak trend as the weather has been drier. By
comparison, the global tea crop position during 2010 was comparatively in line
with the previous year. The position was impacted by adverse
weather conditions in most tea growing areas. There is a risk of
volatility, due to the tight supply / demand scenario, but with long rains
having started in Kenya, the situation is expected to ease, although it is a
little early to predict that the rains will translate to good crop. The Kenyan
and Sri Lankan crop in 2010 was higher than the previous year.
With regard to Coffee, 2010 began on a steady note for both Arabica and
Robusta. Going by the prospects of the biggest ever ‘on’ year crop in Brazil
that would ultimately result in only a marginal surplus in supply, no changes
were witnessed in the prevailing price levels. Even though the market started
steady there was a significant upward journey from the end of June onwards
which meant that the price of Arabica appreciated by about 100% by the end of
the year. Robusta was not left untouched by the explosive increase in Arabica
but the extent of increase was far less at about 50%, as it showed a greater
supply surplus than Arabica. The water business from the current year will be
undertaken by NourishCo Beverages Limited, the Joint Venture between the
Company and PepsiCo. NourishCo have already drawn plans for distribution of
Himalayan and the newly developed fortified water products. The vision of the
water business is to offer a portfolio of leading edge health and wellness
products in a wide range of formats and delivery options to straddle the entire
consumer pyramid.
Outlook
The outlook for the company is promising, in light of its refreshed
mission and vision and clear strategic framework. Tata Global Beverages’
leadership team and employees at all levels are in line with the strategy and
working towards making it a success. The recent brand investment and key
campaigns such as Jaago Re and Tetley Tea Folk should serve to enhance brand
value in the consumer’s eyes so that their brands remain top of mind.
Disruptive innovation is core to the company’s success and culturally and
structurally Tata Global Beverages is in a good position to deliver this with
its new Global Marketing and Innovation and Research and Development teams that
are specifically focused on creating growth outside of the core business. The
company’s product development team has developed an exciting range of water
based and other products which will fuel their growth in future.
The company is also attracting key talent
with strong FMCG background who bring expertise and experience that can be
leveraged to fuel growth.
FIXED ASSETS:
·
Land
·
Tea Estate Land / Fuel
·
Building
·
Bridges
·
Plant and Machinery
·
Furniture, Fixtures and
Office
·
Equipments
·
Motor Vehicles
·
Capitalized Software
·
Non Compete Fee
PRESS
RELEASE
Leadership news from Tata Global Beverages
Mr Harish Bhat, CEO and Managing
Director, Tata
Global Beverages
Mr Cyrus Mistry, Deputy Chairman,Tata
Sons
Tata
Global Beverages announced that Mr. Cyrus P Mistry, Deputy Chairman of Tata
Sons has been inducted to the Board of Tata Global Beverages Limited as a
Director.
Mr.
Darius Pandole has joined the Board of Tata Global Beverages Limited as an
Independent Director. Mr. Pandole holds a BA (Economics) degree from Harvard
(1988) and an MBA from the University of Chicago (1992). He is a Partner at New
Silk Route Advisors Pvt. Ltd, a private equity firm focused on investing in
India and other Asian economies. Mr. Pandole had earlier worked with Kraft
General Foods in the US and returned to India in 1993 and managed the
operations of his family owned soft drinks business, Duke and Sons Limited,
which was a market leader in Western India. He served as Managing Director of
IndAsia Fund Advisors Pvt. Ltd., the Indian advisor to the AMP-IndAsia India
Fund – a private equity fund established in partnership with AMP of Australia.
Mr. Pandole joined IDFC PE Ltd. in February 2003, and was the Executive
Director, and later Chief Operating Officer. Mr. Pandole is currently an
elected member of the Executive Committee of the Indian Private Equity and
Venture Capital Association.
Mr. Harish Bhat has been appointed CEO and Managing Director of Tata Global
Beverages Limited with effect from 1st July 2012. Mr. Bhat will take over from
Mr. Percy Siganporia who retires on 30th June 2012. Mr. Harish Bhat holds a
Post Graduate Diploma in Management (PGDM) from the Indian Institute of
Management, Ahmedabad where he was ranked first in the graduating batch,
winning the IIMA Gold Medal for Scholastic Excellence and also holds a B.E.
(Hons.) degree in Electrical and Electronics from Birla Institute of Technology
and Science, Pilani, where he graduated first class with distinction and was
ranked first in the graduating batch. He joined the Tata Group as TAS
probationer in 1987 and has completed 25 years. He was previously with Tata Tea
Limited from 1988 to 2000 holding various positions. Most recently he was with
Titan Industries Limited as Chief Operating Officer – Watches and Accessories
Division where he led the world’s fifth largest watches business with
success. Mr. Bhat was awarded the British Chevening Scholarship for
Young Managers by Govt. of United Kingdom in 1997. He is a prolific writer with
over 100 published articles on economics, marketing, humour and is currently
engaged in writing a book on the Tata group, which is in final draft stages.
Mr. Siganporia, also a senior TAS officer, joined the company in 1975 and held
several important positions during his tenure. His tenure included
responsibilities in Sales & Marketing in the Packet Tea Division, Kolkata
and recently in the Executive Office, London. He successfully led critical
change initiatives across Tata Global Beverages and has played a key role in
Tata Global Beverages' transformation from its heritage in tea plantations in
India to a growing global organisation with a portfolio of strong and dynamic
brands. Mr. Siganporia retires after 38 years of distinguished service in the
Tata Group.
About Tata
Global Beverages
Tata Global Beverages is a global beverage business and the world’s second
largest tea company. The group’s annual turnover is US$1.4bn and it employs
over 3,000 people worldwide. The company focuses on ‘good for you’ beverages
and has a stable of innovative regional and global beverage brands, including:
Tata Tea, Tetley, Himalayan natural mineral water, Good Earth and Eight O’clock
coffee. For more information please visit www.tataglobalbeverages.com
Tata Tea
Jaagore launches India Awakened; recognizes society's Change Agents
Tata
Tea "Jaagore” recognized 25 change agents with the release of acoffee
table book today titled "India Awakened”.Released by the Rural Development
Minister, Mr. Jairam Ramesh, the book acknowledges common people whose efforts
have made a positive contribution to the society. It aims to create an
environment of hope and motivation with success stories of these agents of
change.
The
coffee table book is a part of the 'India Can India Will' campaign launched by
Hindustan Times in partnership with Tata Tea in January 2012.
A
panel comprising eminent personalities felicitated the change agents at the
book launch. The panel comprised Mr. Dipankar Gupta, Professor of Sociology,
Ms. Aruna Roy, Member, National Advisory Council,Ms. NirmalaSitaraman, National
Executive Member, BharatiyaJanata Party and Ms. SagarikaGhose, CNN-IBN Deputy
Editor who moderated the session.
Commenting
on SochBadlo's initiative, Mr. Vikram Grover, Vice-President, Marketing, Tata
Global Beverages, India, said, "Tata Tea encourages people to see
opportunity where others see adversity and stands by its dictum 'Chai
PiyoSochBadlo'. For over four years now the Jaagorecampaign has focused on
awakening the nation to issues and challenges that it has foreseen (The issue
of corruption was the focus of brand advertising long before it became a
burning platform in media), in doing so it has demonstrated thought leadership.
The campaign takes different avatars depending on the mood of the nation and
taps into underlying sentiment. The latest campaign "SochBadlo” attempts
to spread positivity in a nation plagued with negative sentiment currently.
This association with Hindustan Times was done to identify and spread stories
of people who have seen positivity where most would have seen adversity. This
book is dedicated to these 25 individuals who have gone all out to make a
positive difference to the lives of many. A single positive idea placed in the
midst of people can change perspectives. We at Tata Global Beverages
congratulate the change agents."
About Tata Tea SochBadlo
In
November 2011, Tata Tea SochBadlo began brewing positivity on www.jaagore.com,
against a backdrop of scams and corruption when the morale of the entire
country was very low. Tata Tea wanted Indians to not only wake up and change
their perspective but to also be more optimistic and look at the glass half
full. One positive thought went on to inspire million others and took the shape
of a positive revolution which is based on the premise of 'SochBadlo,
DeshBadlega'. The campaign recently won three bronze Abbys in three categories
– 'brand campaign website', 'creative use of social media' and 'digital
integrated campaign.' For more information visit www.jaagore.com.
About Tata Tea and Tata Global Beverages
Tata
Tea is a leading brand in India and is owned by Tata Global Beverages, a
company which has presence in over 70 countries. Tata Global Beverages is a
global beverage business and the world's second largest tea company. The
group's annual turnover is US$1.5bn and it employs around 3,000 people
worldwide. The company focuses on 'good for you' beverages and has a stable of
innovative regional and global beverage brands, including: Tata Tea, Tetley,
Himalayan natural mineral water, Good Earth and Eight O'clock coffee. For more
information please visit our website www.tataglobalbeverages.com.
|
Check List by
Info Agents |
Available in
Report (Yes / No) |
|
1) Year of Establishment |
Yes |
|
2) Locality of the firm |
Yes |
|
3) Constitutions of the firm |
Yes |
|
4) Premises details |
-- |
|
5) Type of Business |
Yes |
|
6) Line of Business |
Yes |
|
7) Promoter's background |
-- |
|
8) No. of employees |
No |
|
9) Name of person contacted |
No |
|
10) Designation of contact person |
No |
|
11) Turnover of firm for last three years |
Yes |
|
12) Profitability for last three years |
Yes |
|
13) Reasons for variation <> 20% |
-- |
|
14) Estimation for coming financial year |
No |
|
15) Capital in the business |
Yes |
|
16) Details of sister concerns |
Yes |
|
17) Major suppliers |
No |
|
18) Major customers |
No |
|
19) Payments terms |
No |
|
20) Export / Import details (if
applicable) |
No |
|
21) Market information |
-- |
|
22) Litigations that the firm / promoter
involved in |
-- |
|
23) Banking Details |
Yes |
|
24) Banking facility details |
Yes |
|
25) Conduct of the banking account |
-- |
|
26) Buyer visit details |
-- |
|
27) Financials, if provided |
Yes |
|
28) Incorporation details, if applicable |
Yes |
|
29) Last accounts filed at ROC |
Yes |
|
30) Major Shareholders, if available |
Yes |
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling
shareholders or senior officers as terrorist or terrorist organization or whom
notice had been received that all financial transactions involving their assets
have been blocked or convicted, found guilty or against whom a judgement or
order had been entered in a proceedings for violating money-laundering,
anti-corruption or bribery or international economic or anti-terrorism sanction
laws or whose assets were seized, blocked, frozen or ordered forfeited for
violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws, regulations
or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.55.80 |
|
|
1 |
Rs.86.53 |
|
Euro |
1 |
Rs.68.58 |
INFORMATION DETAILS
|
Report Prepared
by : |
PRL |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
9 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
76 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
-- |
NB |
New Business |
-- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.