INTRODUCTIONThe tea industry in India is about 172 years old. It occupies an important place and plays a very useful part in the national economy. The industry combines both agriculture and industry.Tea plantations in India are mainly located in rural hills and backward areas of North-eastern and Southern States. Major tea growing areas of the country are concentrated in Assam, West Bengal, Tamil Nadu and Kerala. The other areas where tea is grown to a small extent are Karnataka, Tripura, Himachal Pradesh, Uttaranchal, Arunachal Pradesh, Manipur, Sikkim, Nagaland, Meghalaya, Mizoram, and Bihar. The competitors to India in tea export are Sri Lanka, Kenya, China, Indonesia and Vietnam.

There are basically two types of tea sales in India - through Auctions and Private Sales, also called as ex- garden sales. In Auction sales, tea is auctioned at auction centers through brokers to buyers who either sell it to wholesalers / retailers or export to overseas markets.

Tea is generally placed in the restricted category of the EXIM policy. Through special Import License tea can be imported by paying import duty. Since August 1998, tea is being freely imported from the SAARC countries. Under the EQU / EPZ units tea can be imported for re exports after value addition.The tea plantation industry is strictly guided by various statutory Orders through the Acts of Parliament like - Tea Act, Essential Commodities Act, Plantation Labour Act, Factories Act, PFA Act, Standards of Weights and Measures act etc.Quality control strictly conforms to IS 9723 and Prevention of Food & Adulteration Act (PFA). Disposal of tea waste is done through the tea waste control of 1959. Many gardens are now taking quality certifications under ISO 9002:Some statistical facts about the Indian Tea Industry: The total turnover of the industry is around Rs. 10,000 crores. Since independence, tea production has grown over 2505, while land area has grown by 40%. Total net foreign exchange earned per annum is around Rs.1847 crores. Industry is labour intensive and employs over 1.1 million workers and generates income for 10 million people indirectly. Women constitute 50% of the workforce. 802 M.Kgs or about 82% of total production of 981 M.Kgs of tea went for domestic consumption.

RECENT DEVELOPMENTSInspite of its importance, tea industry of India is going through a crisis phase since 1990s. The industry has witnessed many structural changes during recent years, which include emergence of small tea growers in place of large plantation and introduction of bought leaf factories (BLF). The present crisis has led to the closure of many tea estates (e.g., 20 estates in Kerala, 30 in West Bengal, about 70 in Assam have close down since the late 1990s). In early 2005 the tea industry witnessed major companies withdrawing from production and concentrating on the packaging/ retailing sector (e.g. Tata. Tea, HLL etc in India). In the market, the rising competition at domestic as well as international front has deepened the crisis of tea industry of India. . Shift in the composition of demand for tea in the importing countries has had unfavorable effects on export earnings from tea in India. The international market price of tea has declined from US $ 2.09 to US $ 2.03 per kg in between 2005 and 2006. Though countries like Sri Lanka, Kenya and Indonesia are growing fast in their export and higher price realization, during the same period. Export of tea from India to some of the major importing countries like Russia, UK, and USA are showing a sharp decline.Although, per capita consumption of tea in India is amongst the lowest (64 grams), but in volume terms India is the largest consumer. Since 1970, India has become the largest absolute consumer of tea after UK. Larger domestic demand has given a new direction to the tea industry in the recent years.

Major causes of the crisisDespite Indias historical success with the tea industry, in recent years, the industry has faced serious competition in the international and national market which has lead to the present crisis. Tea prices in India are being driven down by many factors:a) Decline in demand for Indian tea in the global market b) Defects in auction systemc) Poor price realizationd) Defective market structure e) Increase in cost of production

Recommendations for improvement Despite being the largest producer and consumer of tea, the Indian plantation sector lacks appropriate mapping of production and consumption levels. Due to absence of accurate estimates the formulation of long term industry wide action plans have been affected. India has concentrated more on building up its large estates and has given less attention to processing and improving the quality by proper blending and marketingfor higher price realization of their products. Unlike its key competitors, India does not have any powerful brand to support its promotion drive in the international market. Study done by the United Nations Food and Agriculture Organization (FAO, 2001) has suggested the need for reducing the unit cost of production through productivity gains, capacity building of small growers, streamlining marketing channels, improving infrastructure, tailoring marketing activities to individual countrys demand, propagating health benefits of tea and promotion of organic tea using the tea mark. This is exactly what the domestic tea companies should do for their long term survival. Improvement of supply chain management inside the country and global tea marketing network. The tea industry in India has a legacy of corporate farming right from the day of British rule. The current situation in the sector has given ample reason for a rethink on whether corporate farming can really boost agriculture International brands like Liptons, Brooke Bond of HUL and Tetly tea of Tata Tea; etc are the market leaders and have great power in price determination in both domestic and international market. This needs to be stopped and proper investigation is needed to curb the wrong practices in the tea market by introducing new laws to regulate the price movements. It has been observed that the actual producer of tea has no direct link with the ultimate consumer. Therefore, the producers do not understand the market demand / choice of the customer, it is very important in todays market economy for long term sustainability of the industry. With the withdrawal of sales restriction, the growers can directly go to the market by building their own brand. As the margin of profit is very high at the present domestic retail market, Indian tea growers should invest and take this opportunity for the promotion of their brand at the retail market. Fresh capital inflow is needed right at this moment for the tea industry of India. Investment in new plantations and production machineries must come immediately to compete in the international market. one of the most important steps from the government part shall be to introduce a stronger competition law to curb the misuse of corporate buying power and promote social objectives at the garden level.

CURRENT SCENARIO OF THE INDIAN TEA INDUSTRY

Tea is normally classified based on the processing, leaf size and grade. Fermentation is the major process and creates two major classifications:

Price TrendRecently tea prices showed bouyancy, which started from 2006, after depressed prices for almost a decade since 1999.A slump in global output, decline in production due to poor monsoon rains, steady increase in domestic demand, range-bound export volumes and low growth in production further drove prices upwards in 2012.However Indias tea production had picked up in the last quarter of 2012 and initial signs are pointing to better weather in 2010, signalling a possible change in the price trend. Even if prices do not retrace too much, producers may have to live with subdued prices during the year. It does appear that the two-year run of rising tea prices is losing steam.

Chart 1: Trend in Domestic Tea Prices (source: ICRA Research)

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Production, consumption and ExportsA secular increase in domestic consumption on the one hand and muted increase in production on the other, has been the main factor supporting the increase in tea prices from 2006 onwards. According to ICRAs estimates, while the average growth in production during the period 2003-07 was just 1.9% or so, domestic consumption would have increased annually at around 3.5% during the same period. The steady increase in domestic demand, range-bound export volumes and low ICRA Rating Feature Indian Tea Industry: Outlook Positive for the Short to Medium Term ICRA Rating Services Page 3 of 8 growth in production absorbed the pipeline stock over the years and left virtually no carry-forward stock at the end of the 2007 season.Production and consumption of Tea in IndiaParticulars 200420052006200720082009201020122013

PRODUCTION (million Kg)854838878893946982945981696.7*

CONSUMPTION (million kg)673693714735757771786802828(E)

* production from January to Sepetmber - Estimated figureSource: ICRA ResearchExportsExports play a vital role in maintaining the overall demand-supply balance in the domestic market. Healthy export realisation is also crucial for domestic realisations as un-remunerative prices in the export market may lead to exporters dumping the produce in the domestic market, which in turn would exert a downward pressure on domestic prices. Tea exports from India have remained range bound over the period 1997-2011 with some year-to-year fluctuations seen in between.Export of Tea from IndiaYEARQUANTITY(Million Kg)Value(Rs. Crores)UNIT PRICE (Rs/kg)

2011199.051830.9891.99

2012218.732006.5391.73

2010178.751810.11101.26

2011203.122392.91117.81

2012131.21777.04135.42

*Export from January to SeptemberSource: ICRA ResearchImport of Tea from IndiaThe continuous fall in prices of tea, coupled with high cost of production has adversely affected the economy of the tea plantations resulting in some tea gardens being abandoned or under lock out in various states. The teas being imported are not necessarily inferior teas and the practice of blending with Indian teas often serves the purpose of providing teas as per customers choice and making them price-competitive in international markets.

Import of tea from IndiaYEARQUANTITY(Million Kg)Value (Rs. Crores)UNIT PRICE (Rs/kg)

201116.7698.5158.79

201223.81119.4150.15

201015.99104.6065.43

201120.28161.9779.90

201215.82132.0983.50

*Export from January to AugustProfitability of bulk tea playersAn increase of around 28% in tea prices on an average in 2011 has meant considerable increase in the profitability of bulk tea players in FY2011-12, given that around 65% of their costs are fixed in nature. Chart 6 brings out the positive impact of increasing tea prices on the aggregate total income and profitability indicators of some of the large bulk tea players in India, which shows significant improvement over the past few years.

Chart 4: Trend in Aggregate Income and Profitability Indicators of Bulk Tea

2009-102012-132010-112011-12

Demand-Supply GapFor the Indian tea industry, the main driver of demand is the domestic market, with domestic consumption now growing at an estimated 3.5% annually, as against around 2.5% a decade earlier. At the current growth rate, the domestic market would require an incremental 30 Mkg or so annually, going forward. As against that, tea supply has been growing at less than 2% p.a because it is difficult to improve garden yield of tea even during favourable climatic conditions, and new plantations need a long gestation period of at least 4-5 years. Therefore the demand-supply gap in India is likely to persist at least over the medium term.

INDUSTRY OUTLOOK:The tea industry has every reason to look ahead in 2010 with great deal of optimism and confidence, according to the Tea Market Annual Report published by J Thomas and Company Private Limited, the world's oldest and largest tea auctioneers.With virtually no carry forward stock, and growing domestic demand to act as buffer against the uncertainties of the global tea trade, price levels are expected to remain attractive, the report observes.Early cropping patterns indicate that demand supply equation is likely to be more balance in 2010. Both Kenya and Sri Lanka production is expected to exceed that of 2012 and indications are that the March crop in North India will be higher than that of the last year following some much needed rainfall.While the supply situation may be more comfortable than the previous season, it is likely to be absorbed by the domestic market where quality produce will continue to be in great demand, the reports states.ExportsIndian exports at the end of 2012 stood at 191.5 million kg, compared to 203.1 million kg in 2011, a decline of 11.6 million kgs. The strong domestic demand ensured that the exporters were often out priced, particularly in first three quarters.Lower orthodox production in North India was also another factor contributing to the decline in exports. As a result, exports out of North India at 98.8 million kg recorded a decline of 17.4 million kg while exports out of South India at 92.7 million kg recorded a rise of 5.8 million kg. The per unit value increased from Rs 117.81 in 2011 to Rs 136.64 in 2012, a gain of Rs 18.83.Exports to Iraq saw a significant increase during the year with an additional 11.1 million kgs over 2011. Shipments to Russia grew by 4.2 million kg and to Afghanistan by 1.8 million kg. Exports to Egypt suffered a setback, the shortfall being 9.6 million kg. Offtake by Iran, UAE, UK and the Continent also declined during the period.

COMPANY OVERVIEWJayshree Tea & Industries LimitedIncorporated as Jay Shree Tea Gardens in Oct.'45 with two tea estates, the company changed its name to Jay Shree Tea and Industries (JSTI) in 1960. It was promoted by B K Birla.Started with an initial paid-up share capital of Rs 7.86 lac, it was raised to Rs 39.05 lac in 1947 and thereafter only a rights equity issue was made during 1960 in the ratio 1:5.The company manages around 12 tea gardens in Assam, West Bengal, Tamilnadu and Kerala. It has diversified over the years and manufactures plywood in Andamans and superphosphates and sulphuric acid in West Bengal; and has interest in shipping, real estate development, tubes and tyres. The company is packing its tea from different tea estates, in polypouches and it is sold under brand names -- Sadabahar, Shaandar and Sangam. JSTI also acquired Maitrayee Tea Project at Chopra near Islampur with 192 acres under tea plantation to increase its presence in the area.During 1999-2000, the company established a new factory named 'Aryaman Tea Estate' in Jalpaiguri Dist, which has commenced production from Sep, 1999. The factory has the capacity of 7 lac kgs made tea per annum. In June 2000, the B K Birla group's shareholding in Jay Shree Tea & Industries has gone up to 44.61% from 40.15% following the completion of the company's buy back offer for 12.30 lakh equity shares.The company bought back 12.30 lac equity shares of Rs.10/- each at a price of Rs.120/-per share in 2001-02 and subsequently the total Share Capital as on March 2002 was Rs.10.67 crores. The tea processing factory which is being set up at Ledo,Assam has commenced its commercial production with a annual capacity of around 6 lac kg.As the Supreme Court has banned the falling of trees in Andaman & Nicobar Islands,the company's Plywood Operation is still under suspension. The 100% subsidiary company viz Shiva's Group Ltd was amalgamated with the company with the prior approval from the shareholders w.e.f 25.02.2002.It also proposes to set up an International Outsourced Call centre at Kolkata. The company is proposing to delist its equity shares from Delhi Stock exchange as there is no transactions.On BSE, as on 22 April 2012:Dividend Yield (%)1.01

Market Cap (Rs Mn)3312.63

P/E4.65

EPS (Rs.)63.72

Face Value (Rs.)10

Volume142257

Shareholding Pattern as in September 2012:Description ( As On September 2012 )No of ShareHoldersNo of Shares% of ShareDemat

Promoter

Indian Promoter14449816940.253685170

Total Promoter14449816940.253685170

Non Promoter

Institutions

Mutual Funds / UTI127175856.42716185

FI/Bank/Insurance313812383.41

FII32000001.79200000

Other02000001.79200000

Total Institutions46129882311.621271276

Non-Institution

Bodies Corporate821165567814.821609689

NRIs/OCBs82426050.3840195

Others9658367906432.922699777

Total Non-Institution10561537734748.124349661

Total Non Promoter10607667617059.755620937

Grand Total10621111743391009306107

FINANCIAL STATEMENTS ANALYSISFinancial Statement analysis means analysis and regrouping of data contained in historical financial statements. It serves the essential function of converting accounting data contained in financial statements in to useful information which is always in scarce supply. After analysis of financial statements, interpretation of analyzed information is done by decision maker to forecast future profitability, financial strength and liquidity position of the business.TYPES OF ANALYSIS:Financial statements are analysed to establish certain crucial relationships which help us to take sound decisions. Accounts for the year 2010-2011 and 2011-2012 have been studied in this report.Analysis consists of : Financial Ratio Analysis Common Size Statement Time Series AnalysisFINANCIAL RATIO ANALYSISRatio analysis is a very popular tool of financial analysis. Under this system of analysis, financial statements have been analyzed by computing accounting ratios. Ratios indicate how a business is performing and provide indications of trends and patterns. They can be compared to the same ratios in previous years' accounts and the accounts of other businesses operating in a similar environment. The ratios can be looked at from three perspectives: Creditors Investors ShareholdersThere are various parameters upon which various types of different analysis is done. They include:1. Liquidity Analysis.2.Profitability Analysis.3.Solvency Analysis.4.Efficiency Analysis.LIQUIDITY RATIOSLiquidity is the ability to convert assets into cash or to obtain cash. It is important from the point of view of meeting the firms short term obligations. Current RatioIt is the ratio of the current assets to current liabilities of the company. It is calculated to test the short term solvency of a business and its ability to meet its short term commitments. Besides measuring liquidity, it also measures the margin of safety available in case of uncertainty of flow of funds.It provides a measure of degree to which current assets cover current liabilities. The excess of current assets over current liabilities provides a measure of safety margin available against uncertainty in realization of current assets and flow of funds. Quick ratio An indicator of a company's short-term liquidity.The quick ratiomeasuresa company'sability to meetits short-term obligations withits most liquid assets. The higher the quick ratio,thebetter the position of thecompany.Quick Ratio= (Cash + Marketable securities + accounts receivable) / Current LiabilitiesLiquidity RatiosJayshree Tea Limited

Mar-11Mar-12

Current Assets/Current Liabilities1.763.61

Quick Assets/Current Liabilities0.710.94

Analysis:Current Ratio: We notice that in case of Current Ratio Joonktollee Tea and Jay Shree Tea have a high current ratio whereas McLeod Russels and Rossell have a low ratio. High ratio indicates that the company may be high amount of receivable and large amount inventory piled up which is a bad sign, whereas it may also suggest that the company receives its payments well before the expiry of the credit period as such indicating a strong credit policy of the company. Thus a right proportion of current assets and current liabilities are required and the ideal ratio is said to be 2:1.Quick Ratio: Sometimes a company could be carrying heavy inventory as part of its current assets, which might be obsolete or slow moving. Thus eliminating inventory from current assets and then doing the liquidity test is measured by this ratio. The ratio is regarded as an acid test of liquidity for a company. It expresses the true 'working capital' relationship of its cash, accounts receivables, prepaid and notes receivables available to meet the company's current obligations. Again when we look at the acid test ratio it indicates the actual indicator of the current position.

PROFITABILITY RATIOSProfitability ratios are probably the most important ratios studied by any analyst. They are able to give a good overall picture of a company with respect to its peers. The most important objectives for the business and, arguably therefore, the most important ratios, are those concerned with profitability.Net profit marginNet profit margin divided by net revenues, often expressed as a percentage. This number is an indication of how effective a company is at cost control. The higher the net profit margin is, the more effective the company is at converting revenue into actual profit. The net profit margin is a good way of comparing companies in the same industry, since such companies are generally subject to similar business conditions. However, the net profit margins are also a good way to to compare companies in different industries in order to gauge which industries are relatively more profitable. also called net marginNet Profit Margin =Net Profit=Profit before Interest and Taxation

TurnoverTurnover

Return on Capital Employed: Net After Tax Profit divided by Net Worth, this is the 'final measure' of profitability to evaluate overall return. This ratio measures return relative to investment in the company. Put another way, Return on Net Worth indicates how well a company leverages the investment in it. May appear higher for startups and sole proprietorships due to owner compensation draws accounted as net profit.

Jayshree Tea Limited

Mar-11Mar-12

Return on Total Capital Employed0.0550.014

Return on Assets0.0110.003

NP Ratio0.0420.016

AnalysisNet Profit Margin: The Profit Margin of a company determines its ability to withstand competition and adverse conditions like rising costs, falling prices or declining sales in the future. The ratio measures the percentage of profits earned per dollar of sales and thus is a measure of efficiency of the companyReturn on Assets: The Return on Assets of a company determines its ability to utitize the Assets employed in the company efficiently and effectively to earn a good return. The ratio measures the percentage of profits earned per dollar of Asset and thus is a measure of efficiency of the company in generating profits on its Assets.LEVERAGE RATIOSThese ratios determine the financial leverage enjoyed by the firm and also look at the short term solvency of the firm in terms of its interest paying capacity. Long Term Debt / Equity ratios provide insight into the extent to which nonequity capital is used to finance the assets of the firm.Ratio = long term liabilities/ shareholders equityThe higher is the ratio, the higher the proportion of assets financed by non-shareholder parties. Which components to include in the numerator or denominator of the ratios depend on how one defines liabilities and shareholders equity.

Financial Leverage ratiosJayshree Tea Limited

Mar-11Mar-12

Total Debts to Assets0.5810.529

Capitalization Ratio0.4820.481

Debt-Equity Ratio0.9290.926

Interest Coverage Ratio2.5162.953

ANALYSIS:Jay Shree Limited would fall on the higher end.TURNOVER RATIOSFixed asset turnover is the ratio of sales (on the Profit and loss account) to the value of fixed assets (on the balance sheet). It indicates how well the business is using its fixed assets to generate sales.

Generally speaking, the higher the ratio, the better, because a high ratio indicates the business has less money tied up in fixed assets for each dollar of sales revenue. A declining ratio may indicate that the business is over-invested in plant, equipment, or other fixed assets.

Efficiency RatioJayshree Tea Limited

Mar-11Mar-12

Cash Turnover143.4810.49

Total Assets Turnover0.980.73

Accounts Receivable Turnover6.099.5

Analysis:This ratio is least in case of Jay Shree Tea which is also below the industry average; this inefficiency increases the chance of default by the debtors.CROSS SECTIONAL ANALYSISIn this analysis, the different financial variables of different companies have been compared over a period of time of two years viz. 2006-2007 and 2007-2011. As such, it helps us to get some sort of trend of various financial factors in the financial statements of a company.

Common Size Profit and Loss AccountJayshree Tea Limited

YearMar-11Mar-12

Share Capital 3.543.47

Reserves & Surplus 48.2948.45

Net Worth51.8351.92

Secured Loans 41.1939.63

Unsecured Loans 6.988.45

Total Debt48.1748.08

Total Liabilities100100

Gross Block 76.4972.69

Less: Accum. Depreciation26.7625.72

Net Block49.7446.97

Capital Work in Progress0.840.64

Investments 31.9130.77

Current Assets, Loans & Advances

Inventories 16.0912.17

Sundry Debtors 21.599.15

Cash and Bank Balance0.928.28

Loans and Advances 11.38.84

Less: Current Liab. & Prov.

Current Liabilities 21.98.2

Provisions 7.717.01

Net Current Assets20.2923.23

Miscellaneous Expenses not w/o 00

Total Assets100100

AnalysisJayShree Tea the inventory as a percentage of total assets is highest among all the companies which shows cautious and conservative approach.

COMMON SIZE INCOME STATEMENTJayshree Tea Limited

YearMar-11Mar-12

%%

INCOME :

Sales Turnover 100100

Excise Duty1.672.25

Other Income 3.958.4

Stock Adjustments 3.8-0.67

Total Income106.07105.48

EXPENDITURE :

Raw Materials 44.7332.3

Power & Fuel Cost5.797.52

Other Mfgr Expenses 22.7630.76

Employee Cost 7.459.28

Selling & Admn Expenses 7.2710.22

Miscellaneous Expenses 8.415.31

PBDIT9.6510.1

Interest & Financial Charges 3.843.42

Depreciation1.62.53

Profit Before Tax4.214.14

Tax0.020.22

Fringe benefit tax00

Deferred Tax0.9-0.26

Extra ordinary items-0.832.6

Profit after tax4.121.58

AnalysisThe 2011-12 and lowest for Jay Shree Ltd.Trend AnalysisThis is a time series analysis whereby a study is done in order to interpret what has changed in the company over a year. This can be done by comparing the balance sheet and profit and loss statement of the company for two years. Balance SheetJayshree Tea Ltd.

%

SOURCES OF FUNDS:

Share Capital 0.047

Reserves Total 0.022

Total Shareholders Funds0.024

Secured Loans 0.066

Unsecured Loans -0.153

Total Debt0.028

Total Liabilities0.026

APPLICATION OF FUNDS :

Gross Block 0.079

Less : Accumulated Depreciation 0.067

Net Block 0.086

Capital Work in Progress0.352

Investments 0.064

Current Assets, Loans & Advances

Inventories 0.356

Sundry Debtors 1.421

Cash and Bank-0.887

Loans and Advances 0.312

Less : Current Liabilities and Provisions

Current Liabilities 1.74

Provisions 0.128

Net Current Assets-0.104

Miscellaneous Expenses not written off

Total Assets0.026

Income StatementJayshree Tea Limited

INCOME :

Sales Turnover 54.197

Excise Duty14.797

Other Income -27.502

Stock Adjustments -970.652

Total Income55.066

EXPENDITURE :

Raw Materials 113.514

Power & Fuel Cost18.823

Employee Cost 14.123

Other Manufacturing Expenses 23.789

Selling and Administration Expenses 9.696

Miscellaneous Expenses 144.521

Operating Profit47.447

Interest 73.048

Depreciation-2.453

Profit Before Tax56.84

Tax-83.333

Fringe Benefit tax

Deferred Tax-626.389

Extraordinary Items -149.157

Adjusted Net Profit301.386

SEGMENT REPORTING:The objective of this segment is to establish principles for reporting financial information, about the different types of products and services an enterprise produces and the different geographical areas in which it operates. Such information helps users of financial statements:(a) Better understand the performance of the enterprise;(b) Better assess the risks and returns of the enterprise; and(c) Make more informed judgements about the enterprise as a whole.Many enterprises provide groups of products and services or operate in geographical areas that are subject to differing rates of profitability, opportunities for growth, future prospects, and risks. Information about different types of products and services of an enterprise and its operations in different geographical areas - often called segment information - is relevant to assessing the risks and returns of a diversified or multi-locational enterprise but may not be determinable from the aggregated data. Therefore, reporting of segment information is widely regarded as necessary for meeting the needs of users of financial statements.JAY SHREE TEA & INDUSTRIES LIMITEDBased on the guiding principles given in Accounting Standards on Segment Reporting (AS-17) as prescribed by the Companies Accounting Standard Rules 2006, the Companys primary business segments are tea, chemicals & fertilisers business.

Segment wise Information for the year ended 31st March, 2012

(A)PRIMARY SEGMENT(Rs. in 000)

1 Segment Revenue (Net Sales/Income from each segment)31.03.201231.03.2011

Tea2,81,10,822,03,99,41

Chemicals & Fertilisers1,36,14,1965,92,61

Infotech1,03,05

Others2,81,602,40,97

Less : Inter-segmental Revenue86,9564,46

Total4,19,19,662,72,71,58

2 Segment Results {Profit / (Loss) before Tax & Interest}

a)Tea42,37,655,73,95

b)Chemicals & Fertilisers(3,11,92)5,86,30

c)Infotech(1,11,09)

d)Others1,00,9660,81

Total40,26,6911,09,97

Less : Interest (Net)10,37,517,54,31

Add : Unallocable Income net of unallocable expenditure(13,23,10)6,38,87

Total Profit / (Loss) before Tax16,66,089,94,53

3 Segment Assets (Including revaluation reserve) & Segment Liabilities

AssetsLiabilitiesAssetsLiabilities

a)Tea1,92,35,7531,24,601,60,57,5929,86,39

b)Chemicals & Fertilisers67,70,2749,62,1433,59,889,56,23

c)Infotech4,85,0748,44

d)Others1,19,3961,691,11,1257,35

e)Unallocable1,56,59,3521,19,871,60,16,8311,87,07

Total4,17,84,761,02,68,303,60,30,4952,35,48

Capital Exp. DepreciationCapital Exp. Depreciation

a)Tea10,93,785,55,5811,71,285,61,38

b)Chemicals & Fertilisers41,1750,9045,8048,67

c)Infotech13,0149,09

d)Others5,351,671,31

e)Unallocable2,80,3173,581,31,2667,28

Total14,20,616,81,7313,61,357,27,73

(B)Secondary SegmentDomesticExportTotal

Segment Revenue3,50,22,5568,97,114,19,19,66

(2,18,57,18)(54,14,40)(2,72,71,58)

Segment Assets

4,14,39,133,45,634,17,84,76

(3,56,76,72)(3,53,77)(3,60,30,49)

Capital Expenditure14,20,6114,20,61

Note:(13,61,35)()(13,61,35)

CONCLUSIONThough there has been a recovery in the prices of tea and exports have also started looking up, with the emerging trends in the globalized economy, markets can no longer be protected. The high cost of production is still a matter of concern for the Indian tea industry. The Indian tea industry would have to gear itself up to counter the new forces unleashed by globalization.Budget 2011-12 gave the extension of concessional import duty on imported plantation machinery, like tea bagging machines, till March 31, 2012 will help the industry in value adding and hiking exports in the long run. The finance minister has also increased weighted deduction on payments made to national laboratories, research associations, universities and other institutions for scientific research from 125% to 175%. This will help organisations like the Tea Research Association to take up better research and development activities, resulting in production of better quality tea saplings.With cyclical crisis in the Indian tea industry erasing fast, the current need was to shift from a production oriented strategy and subsidy approach to market oriented strategic framework with market economy outlook. There is a need to liberate the mindset of the industry from its earlier mindset of 'disposal of tea' was changing to a new one --'marketing of tea,' which implied a shift from 'subsidy' to capacity building approach.Multinational tea companies are increasingly contracting with larger agro-processing firms, who were able to effectively coordinate deliveries and quality standards from small farmers through effective supply chain management, as in South India and Indonesia, Sharma said.Oversupply of tea and less demand has contributed to market imbalance in India. Strategies have to be devised to improve the demand side, as so much effort has been put in improving supply efficiency in the past.Only financially sound tea producers would perhaps be able to take the risk of delayed marketing and avail any possible opportunity arising out of future upward price movement in the market.While productivity and quality have received some attention, cost reduction, value addition and risk manageent needed a new focus.

REFERENCES Jay Shree tea & Industries Ltd. Annual Report 11-12 www.money.livemint.com www.bseindia..com www.moneycontrol.com www.capitaline.com

1