MANAGEMENT DISCUSSION AND ANALYSIS REPORT Industrial Structure and Development India is the largest producer of tea in the world, producing about 1185 against 1200 million Kgs of Tea during calendar year 2013 annually. This rebrsents around 42% of world black tea production. Sri Lanka, Kenya and other African countries, Bangladesh are other main Black tea Producer globally. The tea Industry plays a vital role in the Indian economy by way of contributing valuable foreign exchange and providing employment to a vast work force in remote areas. Weather condition during 2014 varied from country to country. In India due to unfavourable weather condition there is loss of production. Demand in global Market was negatively impact due to political unrest and fluctuation in currency. The Auction price in India is higher by 3% due to low production and inventory. The company has one tea estate together with own processing unit. Your company is committed to improve quality. Tea continues to enjoy the status of a popular beverage in the world. The huge domestic market offers a significant opportunity for the tea industry in India. Tea is now also being promoted as a health drink and offers significant opportunities for increase in consumption world wide. Outlook The health of our industry depends to a large extent on the geographical conditions which are outside the realm of the control of the company. The tea industry is a highly labour intensive. The wages of workers are determined according to periodic wage settlement agreement which often increase the labour cost to a significant extent irrespective of any improvement in productivity and realization. The average sale price is expected to increase marginally in comparison to last year. All efforts are being made by the Management to improve the results in comparison to brvious year. Internal Control System and its adequacy The Company has an adequate Internal Control system to ensure proper and efficient use of the company's resources, its protection against any unauthorized use, accuracy in financial reporting and due compliance of the company policy procedure as well as the statutes. Statutory and internal auditors also review its implementation and progress at periodic intervals and take corrective action where any short comings are identified. The audit committee similarly reviews the internal control system and provides guidance for improvement. Financial and operational performance During the year 2014-2015 the company reported a net sale of Rs. 21.76 Crores in comparison to brvious year Rs.24.55 crores and loss for the year ended 31st March 2015 is Rs.14.89 lacs in comparison to profit of Rs.3.31 crores last year. The Loss suffered by the company is mainly due to decline in production. In spite of the increase in wages and other input cost the Management is trying to show improved performance and able to increase the profitability by taking necessary steps to reduce debts and save interest cost. Steps are also being taken to improve quality and increase production. Human resources and development The company has around 1500 permanent employees employed at the tea estate. The labour welfare officer employed specifically for the purpose monitors the welfare of the workers. Your company runs a hospital, ambulance and dispensaries at its out divisions providing medical care to the employees. Personnel The Industrial relation remains satisfactory for the year under review. |