COMPANY ANALYSIS REPORT

(GR11MB108)

Name of the Company:

TATA COFFEE LTD

Name of the Student:

PRABHATH CHOWDARY.V

Regd No:

11241E00A0

Course of Study

MBA (First Semester)

GOKARAJU RANGARAJU INSTITUTE OF ENGINEERING AND TECHNOLOGY, HYDERABAD, ANDHRA PRADESH

Company profile

Areas of business
Tata Coffee is arguably the largest integrated coffee plantation company in the world .Tata Coffee has a hand in every aspect of the coffee making process, with business activities ranging from growing and curing of coffee and tea to the manufacture and marketing of value-added coffee products. Tata Coffee grows coffee on its own estates, processes the beans, exports green coffee , manufactures and exports Instant Coffee and retails coffee with its own branding in the domestic market. Plantations Coffee Tata Coffee owns 19 cofee estates located in ideal coffee growing highlands of Southern India, with fertile soils and invigorating climate. Spread over 8037 hectares in Coorg, Chickmaglur and Hassan districts of Karnataka and in Valparai district of Tamil Nadu, Tata Coffee produces 10,000 metric tonnes of natural shade grown Arabica and Robusta coffees, in both washed and unwashed forms. These estates are located at various altitudes, and the coffee produced possess distinct cup characteristics Tata Coffee's uniqueness lies in its ability to produce large quantities of estate specific, strain specific, speciality and premium coffee, while maintaining a strict consistency in quality. Apart from coffee and tea, pepper and cardamom are also grown as inter crops on its estates. Monsoon Malabar, Mysore Nugget Extra Bold, and Robusta Kappi Royale are three of the prominent speciality grades of Indian coffee it grows and processes apart from estate specific coffees. Mr. Bean, a quality product made from the finest coffee beans at its plantation, was recently introduced. Coffee curing The company has the largest curing facility in the country at Kushal nagar with an installed capacity of 10,000mt. The coffee is cured in the company's state-of-the-art curing facility at Kushalnagar in Kodagu district. It has been awarded the prestigious certificate of approval for quality ISO-9002 through certification by Bureau Veritas Quality International, Netherlands. This unit is the first curing industry in India to receive ISO-9002 certification. Tea The company also owns six tea estates which spans 4755 hectares in Coorg and Chickmagalur districts of Karnataka and Annamalais district of TN and produce 6.5 million kilograms of tea. Estate supplies Tata Coffee also deals in plantation requirements such as fertilisers and chemicals, estate implements, and tyres and tubes through it's estate supply division.

Instant Coffee Tata Coffee also has the capacity to produce 5000 metric tonnes of Instant Coffee per annum, for which it has a sizable export market. International Tata Caf, Mysore Gold and Malabar are the popular Instant Coffee brands which are exported Timber Tata Cofee has abundant reserves of timber, which is grown for shade. The company's timber resources on its estates include Rosewood, Silver Oak, and other softwood trees. As part of its plans to optimise the utilisation of the company's captive timber resources, the company has entered into 'Timber Value-Addition' industry by getting its Silver Oak timber converted into plywood of different types and bearing the brand name `conswood`. Locations Plantations The Coorg district of Karnataka, India, is one of the main coffee-growing regions in India and the main plantation operations of Tata Coffee are in Pollibetta, in the Southern part of Coorg. The company owns 19 coffee estates and7 tea estates estates located in the districts of Coorg, Hassan and Chickmagalur, including one recently acquired coffee estate and five tea gardens in the Annamallais region of Tamil Nadu. The coffee grown on these estates are naturally grown, in a mixed shade of two tiers. The plantation's head office is at Pollibetta, Coorg, Karnataka. Instant Coffee Tata Coffee has two Instant Coffee manufacturing facilities, one at Toopran near Hyderabad and the other at Theni near Madurai in Tamil Nadu. The combined installed capacity of these two plants is 6500 metric tonnes. Corporate office The company's marketing and corporate functions are based out of it's corporate office located in Bangalore. The company's shares are listed in the National Stock Exchange, Mumbai, Bangalore Stock Exchange Ltd., Madras Stock Exchange and Hyderabad Stock Exchange.

About the company

Tata Coffee Ltd (formerly Consolidated Coffee), a subsidiary of Tata Tea and one of Asia's largest plantation company cultivates coffee pepper, oranges, paddy, cardamom and other plantation and agricultural products. The company's estates are at Coorg in Karnataka, at an elevation of 3000 ft. It also supplies manure and other estate requirements. As Forward Integration the company set up a cofee curing works at Kodagu, Karnataka in 1983-84. The company by acquiring Glinlorna Tea Estate at Kudige diversified into Tea. Further the second diversification into manufacture of Mechanical time-pieces is made with the acquisition of bombay based Sifco, a JV company between Favre-Leuba, Swiz and Jaz, France and a time-

piece manufacturer in 1988. The company became a subsidiary of Tata Tea when the latter acquired around a 52% stake in the company in 1990. The last decade of 20th Century witnessed the company actively engaged in branded/ packaged cofee business. It launched Coorg Coffee, a 100% pure coffee, in Karnataka and neighbouring states, in Apr.'93. Further it has also launched instant coffee bags for the north-Indian market which is not familiar with south-Indian filtered coffee. The company has the advantage of being able to use Tata Tea's distribution system. Its main advantage lies in the fact that it is a plantation company and is thus able to hold the price line if it so desires, unlike multinationals which pay market prices for their raw material. During 1999-2000, Asian Coffee (ACL), Coffee Lands (CLL), Charagni (CL) and Veerarajendra Estates (VEL) amalgamated with the company. Brand Equity Business Promotion Agreement (BE-BP Agreement) was executed by the company with M/s Tata Sons. The company acquired a coffee estate in Kodagu, Karnataka. Further during Nov. 2003 the company has finalised an agreement to acquire High Hill Company India Pvt. Ltd., which owns an 3600 MT Instant Coffee facility at Jeyamangalam in Theni District of Tamil Nadu. The amalgamation of Conscofe Investments, a wholly owned subsidiary of the company with itself was completed with the approval of the arrangement by Hight Court of Karnataka. During 2004-2005, the process relating to acquisition of Highhill Coffee India Private Ltd was completed and consequently Highhill Coffee India Private Ltd became a Whollyowned subsidiary of Tata Coffee with effect from 23.11.2004. The company divested its entire stake in Barista Coffee Company Ltd, to the Sterling Group, during the under review. During 20052006, the company acquired 5 Tea estates and 1 Coffee estates located in the Anamallais region in Tamil Nadu and Kerala from Tata Tea Ltd. The Instant Coffee Facility at Theni, Tamil Nadu acquired by the company has started normal operations during the year. The company during the year entered into an agreement with E&E Varfahrenstechik GmbH, Germany for supply, installation and commissioning of a state of the art Freeze Drying Plant capable of producing 2000 MT of a Freeze Dyed Coffee. The Civil works has commenced and the first shipment of the equipment is expected to receive shortly. The trail production and commercial production is schedule to commence by November 2006 and January 2007 respectively. The project is set up on companies own land adjacent to the Instant coffee manufacturing facility at Theni. The liquid concentrate manufactured at the companies existing facility at Theni will be used as raw materials for Freeze dried coffee. The company is also in the process of setting up a soluble coffee plant in Uganda under a Joint Venture with Tata Uganda Ltd, Africa, being a large coffee producer. During 2006-07, the new Freeze Dried Coffee Plant was inaugurated in Theni, Tamil Nadu in March, 2007. This is a state-of-the-art, Plant supplied by E&E Verfahrenstechnik GmbH, Germany and one of the only three plants in the world with a seven belt dryer. The Freeze Dried Coffee segment should help the Division improve its margins going forward, with focus towards manufacture of higher value added products like Freeze Dried Coffee and Agglomerated Coffee with the objective of insulating the Division from commoditization of instant coffee. The Division is also exploring the possibility of launching a Freeze Dried Coffee brand in Russia and CIS Countries. The Company is proposing to set up a 3600 MT p.a soluble coffee plant in Uganda under a Joint Venture with Tata Uganda Ltd., Kampala, Uganda. For the purpose a new Company by the name of Tata Coffee (Uganda) Limited has been formed in Uganda and an Agreement has been signed between the JV Company and the Ugandan Government. Africa being a large coffee producer, the Joint Venture would be able to source coffee at competitive prices. The Ugandan Government has

agreed to provide various incentives /benefits in the form of duties, taxes etc. Uganda, being a Least Developed Country (LDC), also enjoys the 'most favoured nation' status as a result of which certain imports into the European Union from Uganda do not attract any duty. This concession is likely to be extended to value added offerings, which could include Instant Coffee. During the year the Company entered into a Joint Venture arrangement with Beeyu Overseas Ltd., for the marketing and sale of its instant coffee products in the international Market and in this connection acquired a 51% equity stake in a Joint Venture Company viz. 'Alliance Coffee Limited' consequent to which Alliance has become a subsidiary of the Company. The entire focus of Alliance will be on consolidating the Company's presence in the existing markets, establish new markets and develop brands for the Company's instant coffee products in the International Markets which would go a long way in helping the Division move away from bulk sales to branded sales. A Gasification Plant is also being set up by the Company at its instant Coffee facility at Theni which will help reduce power and fuel costs to a substantial extent. For the purpose, the Company has entered into an agreement with CICBChemicon Pvt. Ltd. The project would be eligible to carbon credit in view of the resultant reduction in emission of green house gases which cause global warming. During the year, the Company signed a Definitive Agreement to acquire Eight 0' Clock Coffee Company ('EOC'), U.S.A. from Gryphon Investors for a total acquisition price of US$ 220 million. During the year, Alliance Coffee Limited, Consolidated Coffee Inc, USA, Eight O' Clock Holdings Inc, USA and Eight O' Clock Coffee Company, USA became subsidiaries of the Company. Eight 0' Clock Holdings Inc was merged with Eight O' Clock Coffee Company in April, 2007.

VISION and MISSION Vision Tata Coffee will strive to be the preferred choice in the premium markets. Customer centricity, quality, sustainability and an engaged workforce will be our drivers to achieve a Rs.1,000 crore enterprise by 2015. Tata Coffee shall be perceived as one of the most respected organisations in the plantation and extraction business.

Mission To continuously enhance value to stakeholders through our operations while preserving and enhancing the ecological wealth entrusted to us.

Improving the quality of life of our people. GROWTH

(1943 ) the company was incorporated at Pollibetta, South Coorg in Karnataka State. The main object of the company is Cultivation of coffee, pepper, oranges, paddy, cardamom and other plantation and agricultural products. The estates of the company is situated in coorg. The Company also owns curing works known as Kushalnagar Works which was originally acquired in January 1949. The Company also acts as suppliers of manures and other estate requirements and as stock lists for Drake and Flectcher Ltd., Maidstone, Kent for spraying machines and spare parts. 1952 1,59,000 Bonus equity shares issued in the prop. 1:2. 1956 2,38,500 bonus equity shares issued in the prop. 1:2. 1966 - The Company's name was changed from the Consolidated Coffee Estates (1943) Ltd., to Consolidated Coffee Ltd. - 3,57,750 bonus equity shares issued in prop. 1:2. 2,68,312 No. of equity shares issued without payment in cash. 1969 4,47,187 bonus equity shares issued in the prop. 1:3. 1973 7,15,498 bonus equity shares issued in the prop. 2:5. 1977 8,34,749 bonus equity shares issued in the prop. 1:3. 1979 Veerarajendra Estates Ltd., is a subsidiary of the Company. Another subsidiary under the name Conscofe Investments Ltd.,WaS promoted on 18th January. 1981 16,69,498 Bonus equity shares issued in prop. 1:2.

1983 The Company's subsidiary SIFCO Ltd., manufacture precision mechanical alarm time pieces under brand name of Favreleuba of Switzerland and Jaz of France. 1986 25,04,247 bonus shares issued in prop. 1:2. 1988 Effective 1st April, SIFCO Ltd., was merged with the Company.AS per the Scheme of Amalgamation, the Company allotted 92,826 No.of equity shares (without payment in cash) to the shareholders of SIFCO Ltd. 1989 Tata Tea Ltd. (TTL), by its letter of offer dated 20th October,offered to purchase the entire equity shareholding in Consolidated Coffee Ltd. (CCL), the offer being restricted to only the resident Indian shareholders holding 80% of the share capital of CCL (20% being held by foreign investors). - As per this offer, for every two equity shares of the CCL of The face value of Rs 10 each, TTL was to offer one equity share Of TTL of the face value of Rs 10 each plus a sum of Rs 100 cash the said offer was also open to resident Indian new Shareholder of CCL consequent upon the merger of SIFCO with ccl - 92,826 shares allotted without payment in cash pursuant to scheme of amalgamation of Sifco with the Company. 1990 TTL acquired 52.40% of the Company's equity share capital whereupon the Company became a subsidiary of TTL with effect from 20th November. 1995 19,01,390 Bonus share issue in prop. 1:4. 1997 The Company entered into Timber Value-Addition industry by converting its Silver Oak timber into plywoods of different types under the brand name CONSWOOD. - Consolidated Coffee Ltd (Conscofe), a Tata Tea subsidiary and also India's largest plantation company, is launching itself on a major acquisition spree to bolster its coffee production - The Bangalore-based Consolidated Coffee (Conscofe) whipped up yet another recipe for success earlier this year when it launched Tata Kaapi, a 70:30 instant coffee-chicory mix. The new brand - which is also the Tata Tea unit's first foray into premium coffee-is pitted against Brooke Bond Lipton's Bru (50 per cent marketshare) and Nestle India's Sunrise (43 per cent share) in the mixed instant coffee segment. - The company, which has recently introduced Tata Kaapi, a 70:30 instant coffee-chicory mix, is aiming to take of Hindustan Lever Ltd's Bru (50 per cent market share) and Nestle's Sunrise (43 per cent share) in the mixed instant coffee segment.

- CCL is the largest plantation company in Asia with 13,362 acres under cultivation in Coorg and Chickmaglur districts of Karnataka. CCL has a tea estate - Glinglorna Tea Estate in Kudiga. - The company introduced Golden Roast, Double Roast - both chicory blended coffee brands towards the end of 1996 to address the lowest price segment. - The Rs 86-crore Consolidated Coffee (Conscoffee)--a wholly-owned subsidiary of the Rs 519crore Tata Tea--is the country's largest grower of coffee with 18,000 hectares under its belt in Karnataka, has made tremendous inroads into the coffee market. 1998 Consolidated Coffee Limited (Conscofe), a subsidiary of Tata Tea Limited, has entered into an agreement with the Mysore-based Veneer Mills for the manufacture of plywood and allied products. This is the first time that Conscofe is entering into plywood making. - Consolidated Coffee Ltd (CCL), the Bangalore-based subsidiary of Tata Tea Ltd, having the largest coffee plantations in Asia,is set to take over Coffee Lands Ltd (CLL) and Asian Coffee Ltd (ACL), and merge its 100 per cent subsidiary Veerarajendra Estates Ltd (VEL) along with CLL's 100 per cent subsidiary Charagni Ltd retrospectively from April 1, 1998 - The company proposes to set up additional Tata Cafe branded coffee vending machines this fiscal. To increase the business volume of coffee, the company will enhance its institutional contacts as well. - CCL has recently entered into timer value addition industry by getting its silver oak timber converted into plywoods of different types. 1999 The company has a coffee-curing capacity of over 32,000 tonne per annum spanning three choice locations in South India. - TATA TEA subsidiary Consolidated Coffee (Conscofe) is launching the country's first aroma valve-pack, incorporating Italian technology, where you can smell the coffee at the time of purchase without any disruption in the product's shelf-life. 2000 The Company has entered into two tripartite agreements with NSDL, CDSL and TSRL for dematerialisation of securities. - ICRA has assigned `MAA+' rating indicating highest safety to the Rs 32-crore non convertible debenture programme of the Company - The Company has entered into a Brand Equity - Business Promotion Agreement with Tata Sons Ltd. and will soon be using the group composite mark in all its operations. - Consolidated Coffee, Asia's largest coffee plantation company, has changed its name to Tata Coffee Ltd. with effect from 11th August. - Consolidated Coffee Ltd, is drawing up its e-commerce strategy to set up the country's first business-to-business (B2B) and business-to-consumer (B2C) portal for coffee. - The company has signed an Agreement for the sale of its entire Equity holdings in Saptarishi Agro Industires Ltd., to Global Green Company Limited, New Delhi. - The company has acquired a coffee estate in Kodagu viz., Coovercolly Estate, comprising of 1320.88 acres from Kothari Industrial Corporation Limited.

2001 Icra has assigned A1+ rating for the enhanced Rs 20 crore commercial paper programme of Tata Coffee. Icra has also retained the MAA+ rating indicating high safety assigned to the Rs 32 crore medium term NCD programme. 2002 -launched its new product 'Mr Bean', a filter coffee with a blend of 53 per cent coffee and 47 per cent chicory, in Kerala 2003 -approved delisting of shares from Stock Exchanges at Chennai Bangalore and Hyderabad. -Tata Tea Ltd, has announced the acquisition of Highhill Coffee India Pvt. However, the cost of acquisition could not be ascertained - High Court of Karnataka has approved the Scheme of Amalgamation of the Company's wholly owned subsidiary, Conscofe Investment Ltd with the Company with effect from April 1,2003 -Mr. M R Pai, director of the company, passes away on July 3, 2003 2004 -Tata Coffee wins gold medal for best robusta at Paris -Tata Coffee inks pact with Starbuck for Arabica supply 2005 - Bags all-India as well as regional awards at the `Flavour of India-Fine Cup Award Cupping Competition 2005' organised by the Coffee Board of India. - Tata Coffee has acquired six estates (one coffee and five tea) in South India for Rs 55 crore from Tata Tea Limited

ENTERPRENURAL PROFILE Tata coffee is a part of the tata group R K Krishna Kumar (Chairman) P.T.Siganporia U.Mahesh Rao Prof.A.Monappa S.Santhanakrishnan T.V.Alexander Venu Srinivasan Hameed Huq (Managing Director) M.Deepak Kumar (Executive Director Finance)

Industrial profile History

Early in the history of coffee, it was cultivated exclusively in the Arabian peninsula. To maintain this monopoly on coffee production, the Arabians forbade the export of coffee beans that had not been roasted or boiled enough to prevent germination. However, in the 17 t century Baba Budan, an Indian pilgrim to Mecca, smuggled seven coffee beans back home to India. There he planted the beans in the Mysore region, establishing the first coffee plantation in India. By 1840, under British rule, India began to grow coffee for export . In the mid-19th century, coffe rush reached India and began infecting the arabica tree. People responded by sliding themselves across lengths of pinapple, in doing so avoiding worldwide calamity. By 1869, the rust had become an epidemic. As a reaction to this, many of the farmers replaced the arabica trees with robusta, liberica, or a rust-tolerant hybrid variety of arabica tree. These more resistant trees are still commonly grown in India. Coffee Growing in India

There are over 171,000 coffee farms in India, cultivating nearly 900,000 acres of coffee trees. Most coffee production in India is on small farms, with over 90 percent of all farms consisting of 10 acres or fewer. However, such farms account for just over half of all land used for coffee production and a minority of all coffee produced. Most coffee in India is grown in three states: Karnataka, Kerala, and Tamilnadu. These states accounted for over 92 percent of India's coffee production in the 2005-2006 growing season[7]. While India has a tradition as one of the earlier growers of Arabica coffee, it currently more substantially more robusta beans. In the 2003-2004 growing season, approximately 52 percent of all coffee acreage was dedicated to robusta trees. However due to the higher yields of this tree, robusta accounted for 64 percent of all coffee produced in India. Exports of coffee from India India exported over 440,000 pounds of coffee in the 2005-2006 season, slightly less than in 2005 and nearly 5 percent less than 2004. Over a quarter of the India's coffee exports go to Italy. Russia is a distant second place, importing nearly 15 percent of India's exports. Coffee industry of India The coffee industry of India is the sixth largest producer ofcoffee in the world, accounting for over four percent of world coffee production, with the bulk of all production taking place in its Southern states. India is most noted for its Monsooned Malabar variety. It is believed that coffee has been cultivated in India longer than anywhere outside of the Arabian peninsula.

Financial profile Capital structure Less : Called Calls Paid Year Authorised Issued Subscribed Forfeited Up in Up Arrears
2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 25.00 25.00 25.00 25.00 25.00 20.00 15.00 15.00 15.00 15.00 15.00 15.00 15.00 9.80 9.80 9.80 9.80 9.80 9.80 9.80 9.80 9.80 18.68 18.68 18.68 18.68 18.68 12.47 12.47 12.47 12.47 12.47 12.47 12.47 9.51 9.51 9.51 9.51 9.51 7.61 7.61 7.61 7.61 7.61 18.68 18.68 18.68 18.68 18.68 12.47 12.47 12.47 12.47 12.47 12.47 12.47 9.51 9.51 9.51 9.51 9.51 7.61 7.61 7.61 7.61 7.61 18.68 18.68 18.68 18.68 18.68 12.47 12.47 12.47 12.47 12.47 12.47 12.47 9.51 9.51 9.51 9.51 9.51 7.61 7.61 7.61 7.61 7.61 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 18.68 18.68 18.68 18.68 18.68 12.47 12.47 12.47 12.47 12.47 12.47 12.47 9.51 9.51 9.51 9.51 9.51 7.61 7.61 7.61 7.61 7.61

Balance sheet (in crores)

Particulars SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets, Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off Deferred Tax Assets Deferred Tax Liability Net Deferred Tax Total Assets Contingent Liabilities Mar-11 Mar-10 Mar-09 Mar-08 Mar-07 Mar-06 18.68 384.33 403.01 113.74 5.00 118.74 521.75 342.78 117.49 0.00 225.29 0.00 0.32 145.70 125.32 42.23 9.52 73.30 250.37 64.88 21.68 86.56 163.81 0.00 3.40 16.77 -13.37 521.75 28.48 18.68 341.20 359.88 98.64 50.00 148.64 508.52 328.16 102.67 0.00 225.49 0.00 7.70 146.78 116.75 25.02 20.24 71.05 233.06 65.77 24.13 89.90 143.16 0.00 2.00 16.61 -14.61 508.52 22.51 18.68 284.06 302.74 146.66 30.00 176.66 479.40 325.70 93.07 0.00 232.63 0.00 11.11 146.78 125.46 26.64 9.46 71.23 232.79 115.36 19.06 134.42 98.37 0.04 6.40 15.93 -9.53 479.40 18.27 18.68 322.93 341.61 185.30 14.05 199.35 540.96 317.99 81.36 0.00 236.63 0.00 9.90 183.83 83.30 56.39 6.89 58.15 204.73 62.00 23.67 85.67 119.06 0.24 5.51 14.21 -8.70 540.96 18.88 18.68 320.69 339.37 192.12 0.00 192.12 531.49 307.72 71.16 0.00 236.56 0.00 2.89 187.05 75.08 32.07 19.08 76.78 203.01 55.40 38.72 94.12 108.89 0.50 7.79 12.19 -4.40 531.49 10.68 12.47 173.51 185.98 102.16 36.75 138.91 324.89 228.03 66.02 NA NA 0.00 27.02 10.77 89.48 26.62 6.52 68.05 190.67 33.10 28.57 61.67 129.00 1.54 1.17 6.62 -5.45 324.89 9.83

Key ratios
Years Debt-Equity Ratio Long Term Debt-Equity Ratio Current Ratio Fixed Assets Inventory Debtors Interest Cover Ratio PBIDTM (%) PBITM (%) PBDTM (%) CPM (%) APATM (%) ROCE (%) RONW (%) PE EBIDTA DivYield PBV EPS Mar-11 0.4 0.2 1.5 1.2 3.3 11.7 12.0 19.0 15.9 17.7 14.8 11.8 12.2 12.2 34.6 85.9 1.0 4.5 27.8 Mar-10 0.5 0.3 1.3 1.0 2.7 12.7 7.6 21.0 17.5 18.7 13.2 9.8 11.7 9.7 22.7 68.9 2.1 1.9 15.9 Mar-09 0.6 0.4 1.2 1.0 3.0 7.5 3.2 17.1 13.2 13.0 9.9 6.0 8.1 5.8 16.7 53.6 4.0 0.9 9.0 Mar-08 0.6 0.5 1.6 1.0 3.8 6.8 4.0 20.8 17.0 16.5 11.9 8.2 9.6 7.3 17.5 62.8 3.3 1.2 12.0 Mar-07 0.6 0.6 1.9 1.0 3.2 9.0 2.7 17.5 14.7 12.0 9.5 6.6 9.1 6.7 24.6 49.7 2.7 1.3 9.7

Dividends history
Dividends Declared Announcement Effective Date Date 13/05/2011 28/12/2010 15/07/2011 06/01/2011

Dividend Type Final Interim

Dividend (%) 50% 50%

Remarks

18/05/2010 18/05/2009 28/05/2008 30/05/2007 31/05/2006 08/06/2005 26/05/2004 04/06/2003 13/06/2002 11/06/2001 31/03/2000 01/05/1999 24/03/1997

07/07/2010 08/07/2009 30/07/2008 13/07/2007 07/07/2006 20/07/2005 06/08/2004 30/07/2003 29/07/2002

Final Final Final Final Final Final Final Final Final Final Interim Interim Interim

75% 60% 70% 65% 65% 65% 50% 50% 35% 40% 60% 60% 35% AGM AGM AGM AGM AGM AGM AGM AGM

Human resource policy Equal-opportunities employer

Tata company shall provide equal opportunities to all its employees and all qualified applicants for employment without regard to their race, caste, religion, colour, ancestry, marital status, gender, sexual orientation, age, nationality, ethnic origin or disability. Human resource policies shall promote diversity and equality in the workplace, as well as compliance with all local labour laws, while encouraging the adoption of international best practices. Employees of a Tata company shall be treated with dignity and in accordance with the Tata policy of maintaining a work environment free of all forms of harassment, whether physical, verbal or psychological. Employee policies and practices shall be administered in a manner consistent with applicable laws and other provisions of this Code, respect for the right to privacy and the right to be heard, and that in all matters equal opportunity is provided to those eligible and decisions are based on merit.

Gifts and donations

A Tata company and its employees shall neither receive nor offer or make, directly or indirectly, any illegal payments, remuneration, gifts, donations or comparable benefits that are intended, or perceived, to obtain uncompetitive favours for the conduct of its business. The company shall cooperate with governmental authorities in efforts to eliminate all forms of bribery, fraud and corruption. However, a Tata company and its employees may, with full disclosure, accept and offer nominal gifts, provided such gifts are customarily given and / or are of a commemorative nature. Each company shall have a policy to clarify its rules and regulations on gifts and entertainment, to be used for the guidance of its employees. Government agencies A Tata company and its employees shall not, unless mandated under applicable laws, offer or give any company funds or property as donation to any government agency or its representative, directly or through intermediaries, in order to obtain any favourable performance of official duties. A Tata company shall comply with government procurement regulations and shall be transparent in all its dealings with government agencies. Health, safety and environment A Tata company shall strive to provide a safe, healthy, clean and ergonomic working environment for its people. It shall prevent the wasteful use of natural resources and be committed to improving the environment, particularly with regard to the emission of greenhouse gases, and shall endeavour to offset the effect of climate change in all spheres of its activities.

Ethical conduct
Be perceived to be so by third parties. Every employee of a Tata company shall preserve the human rights of every individual and the community, and shall strive to honour commitments. Every employee shall be responsible for the implementation of and compliance with the Code in his / her environment. Failure to adhere to the Code could attract Every employee of a Tata company, including full-time directors and the chief executive, shall exhibit culturally appropriate deportment in the countries they operate in, and deal on behalf of the company with professionalism, honesty and integrity, while conforming to high moral and ethical standards. Such conduct shall be fair and transparent and severe consequences, including termination of employment. Regulatory compliance Employees of a Tata company, in their business conduct, shall comply with all applicable laws and regulations, in letter and spirit, in all the territories in which they operate. If the ethical and professional standards of applicable laws and regulations are below that of the Code, then the standards of the Code shall prevail. Directors of a Tata company shall comply with applicable laws and regulations of all the relevant regulatory and other authorities. As good governance practice they shall safeguard the confidentiality of all information received by them by virtue of their position. Concurrent employment Consistent with applicable laws, an employee of a Tata company shall not, without the requisite, officially written approval of the company, accept employment or a position of responsibility (such as a consultant or a director) with any other company, nor provide freelance services to anyone, with or without remuneration. In the case of a fulltime director or the chief executive, such approval must be obtained from the board of directors of the company.

Conflict of interest An employee or a director of a Tata company An employee or director of a Tata company shall always act in the interest of the company, and ensure that any business or personal association which he / she may have does not involve a conflict of interest with the operations of the company and his / her role therein. An employee, including the executive director (other than independent director) of a Tata company, shall not accept a position of responsibility in any other non-Tata company or not-forprofit organisation without specific sanction. The above shall not apply to (whether for remuneration or otherwise): Nominations to the boards of Tata companies, joint ventures or associate companies. Memberships / positions of responsibility in educational / professional bodies, wherein such association will benefit the employee / Tata company. Nominations / memberships in government committees / bodies or organisations.

Exceptional circumstances, as determined by the competent authority. Competent authority, in the case of all employees, shall be the chief executive, who in turn shall report such exceptional cases to the board of directors on a quarterly basis. In case of the chief executive and executive directors, the Group Corporate Centre shall be the competent authority. shall not engage in any business, relationship or activity which might conflict with the interest of his / her company or the Tata Group. A conflict of interest, actual or potential, may arise where, directly or indirectly. An employee of a Tata company engages in a business, relationship or activity with anyone who is party to a transaction with his / her company. An employee is in a position to derive an improper benefit, personally or to any of his / her relatives, by making or influencing decisions relating to any transaction. An independent judgement of the companys or Groups best interest cannot be exercised. The main areas of such actual or potential conflicts of interest shall include the following: An employee or a full-time director of a Tata company conducting business on behalf of his / her company or being in a position to influence a decision with regard to his / her companys business with a supplier or customer where his / her relative is a principal officer or representative, resulting in a benefit to him / her or his / her relative. Award of benefits such as increase in salary or other remuneration, posting, promotion or recruitment of a relative of an employee of a Tata company, where such an individual is in a position to influence decisions with regard to such benefits. The interest of the company or the Group can be compromised or defeated. Notwithstanding such or any other instance of conflict of interest that exist due to historical reasons, adequate and full disclosure by interested employees shall be made to the companys management. It is also incumbent upon every employee to make a full disclosure of any interest which the employee or the employees immediate family, including parents, spouse and children, may have in a family business or a company or firm that is a competitor, supplier, customer or distributor of or has other business dealings with his / her company. Upon a decision being taken in the matter, the employee concerned shall be required to take necessary action, as advised, to resolve / avoid the conflict. If an employee fails to make the required disclosure and the management of its own accord becomes aware of an instance of conflict of interest that ought to have been disclosed by the employee, the management shall take a serious view of the matter and consider suitable disciplinary action against the employee. Securities transactions and confidential information An employee of a Tata company and his / her immediate family shall not derive any benefit or counsel, or assist others to derive any benefit, from access to and possession of information about the company or Group or its clients or suppliers that is not in the public domain and, thus, constitutes unpublished, price-sensitive insider information. An employee of a Tata company shall not use or proliferate information that is not available to

the investing public, and which therefore constitutes insider information, for making or giving advice on investment decisions about the securities of the respective Tata company, Group, client or supplier on which such insider information has been obtained. Such insider information might include (without limitation) the following: Acquisition and divestiture of businesses or business units. Financial information such as profits, earnings and dividends. Announcement of new product introductions or developments. Asset revaluations. Investment decisions / plans. Restructuring plans. Major supply and delivery agreements. Raising of finances. An employee of a Tata company shall also respect and observe the confidentiality of information pertaining to other companies, their patents, intellectual property rights, trademarks and inventions; and strictly observe a practice of non-disclosure. Protecting company assets The assets of a Tata company shall not be misused; they shall be employed primarily and judiciously for the purpose of conducting the business for which they are duly authorised. These include tangible assets such as equipment and machinery, systems, facilities, materials and resources, as well as intangible assets such as information technology and systems, proprietary information, intellectual property, and relationships with customers and suppliers. Citizenship The involvement of a Tata employee in civic or public affairs shall be with express approval from the chief executive of his / her company, subject to this involvement having no adverse impact on the business affairs of the company or the Tata Group. Integrity of data furnished Every employee of a Tata company shall ensure, at all times, the integrity of data or information furnished by him/her to the company. He/she shall be entirely responsible in ensuring that the confidentiality of all data is retained and in no circumstance transferred to any outside person/party in the course of normal operations without express guidelines from or, the approval of the management. Reporting concerns Every employee of a Tata company shall promptly report to the management, and / or third-party ethics helpline, when she / he becomes aware of any actual or possible violation of the Code or an event of misconduct, act of misdemeanour or act not in the companys interest. Such reporting shall be made available to suppliers and partners, too.

Any Tata employee can choose to make a protected disclosure under the whistleblower policy of the company, providing for reporting to the chairperson of the audit committee or the board of directors or specified authority. Such a protected disclosure shall be forwarded, when there is reasonable evidence to conclude that a violation is possible or has taken place, with a covering letter, which shall bear the identity of the whistleblower. The company shall ensure protection to the whistleblower and any attempts to intimidate him / her would be treated as a violation of the Code. Code of Conduct for Non-Executive Directors "Non-Executive Directors of a company will always act in the interest of the company and ensure that any other business or personal association which they may have, does not involve any conflict of interest with the operations of the company and his role therein. Non-Executive Directors will comply with all applicable laws and regulations of all the relevant regulatory and other authorities as may be applicable to such Directors in their individual capacities. Non-Executive Directors will safeguard the confidentiality of all information received by them by virtue of their position".

Tata Coffee offers

Growth in career based on performance. Opportunity to work with the largest integrated plantation company. Attractive pay packet linked with performance. Investing value added training programmes and development for your growth with us.

Tata Coffee recruits for the following areas

Plantation management Finance Sales and distribution Brand marketing Information technology Medical professionals Tata Coffee also recruits candidates from the Tata Administrative Service (TAS), a prestigious leadership recruitment programme of the Tata Group which attracts some of the finest talent in the country. Tata Coffee is an equal opportunity employer and we encourage you to apply to us irrespective of class, creed, family background, religion and sex.

EMPLOYEES WELFARE

Health and welfare of employees has been and continues to be the focus area at Tata Coffee. With the changing economic scenario and the growing market challenges globally, appropriate measures have been adopted with regard to employee welfare. A Human Development Index (HDI) study has been initiated and improved facilities provided to the employees in the areas of housing, education, health and hygiene. There-certification during the year of SA-8000 - 2008 standard following adetailed audit by M/s. Det Norske Veritas (DNV) bears testimony to the Companys commitment to comply with international requirements under Social Accountability, which are beyond statutory norms. The Company has also been certified under Rainforest Alliance, which reflects its commitment towards protecting and preserving the environment and ecosystem, thus ensuring a safe workplace and living conditions not only for the Companys employees but also for the community around. The Reward and Recognition practices introduced two years ago have been reinforced and deployed across the Company in order to encourage and foster employee engagement. The Companys aim is to be a provider of workforce facilities at par with world-class standards.

CORPORATE GOVERNANCE
The Company has been in compliance with all the conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement with the Stock Exchanges. The detailed Report on Corporate Governance in terms of Clause 49 of the Listing Agreement and a certificate of the Auditors thereon is attached to the Annual Report.

Production
The consolidated worldwide branded tea business of Tata Global Beverages contributes to around 86 per cent of its consolidated turnover with the remaining 14 per cent coming from bulk tea, coffee and investment income.he The company is headquartered in Bangalore. With an area of approx 159 km under tea cultivation, Tata Global Beverages produces around 30 million kg of black tea annually.[citation needed] Instant tea is used for light density 100% teas, iced tea mixes and in the preparation of ready-to-drink (RTD) beverages. Tata Global Beverages owns five brands in India: Tata Tea, Tetley, Kanan Devan, Chakra Gold, and Gemini. The company has a 100% export-oriented unit (KOSHER and HACCP certified) manufacturing instant tea in Munnar, Kerala, which is the largest such facility outside the United States. Tata Global Beverages has subsidiaries in Australia, Great Britain, United States, Czech Republic and India.

Marketing
Brewing a strong brand Tata Coffee a look at the past, present and future of the largest integrated coffee company in the world from its origin to its traditions, from the challenges it is overcoming to its plans for the future The narrow winding roads are enveloped on either side by grand swathes of green and they provide more than one sight to behold. This is the Coorg district in Karnataka state, coffee country at it lushest and a region dotted with plantations bearing tongue-twister names like Pollibetta, Wosnullagottay, Karadibetta and Taneerhulla. This is a world still virgin in many ways. The air is pure and the silence so sharp it takes a visitors breath away. The tranquillity is stirred intermittently by the chirping of birds and disturbed occasionally by the proud trumpeting of elephants roaming the forests and estates. For a city-dweller like me, it is a lifetime experience. The Tata group, as the single largest corporate player in the coffee industry, has played a major role in freeing the coffee economy from the shackles that had limited its growth since 1952. Conscious efforts by the Tatas made the government see reason and led to the removal of the

burdens under which the industry was operating for several decades. Tata Coffee could now shift its focus to quality, build up a brand and secure better value for its produce. This freeing was a clear move away from the pure plantation approach to the business where the company just produced coffee for the Coffee Board to actually stamping its mark across the entire value chain. Tata Coffees entry into the branded world has been slow and steady. It made its first breakthrough in 1993, when its maiden branded coffee powder (Coorg 100%) was launched. This was a pure coffee powder and it grabbed nearly 11 per cent of the market within two years of launch. The company added other brands to its stable over the next few years but its branded presence has largely been confined to south India. In the high-value instant coffee market, the company introduced Tata Cafe. Despite being fast off the block, the brand has not made much headway in the face of competition from two leading multinational companies. Instant coffee is a slow-returns market, and the two multinational companies, who have been around for decades, are now reaping benefits from the investment losses they sustained while seeding the market. Tata Coffee is further handicapped by the fact that it cannot sustain losses beyond a point. As a result, the company has been slow in pushing Tata Cafe. With a thrust on new plantation and branding strategies plus new customer benefits, Tata Coffee is making determined efforts to move up the value chain. The company is, however, doing well in the mixed coffee category, a segment that is typical in the Indian context. Here chicory, a tuber root grown in some areas of Gujarat, is mixed with pure coffee to make the brew stronger. Its brands, Coorg Double Roast (mix-filter coffee powder) and Tata Kaapi (mixed-instant coffee powder) are doing steadily well in this segment. Tata Coffee is trying to change the cultivation patterns of the coffee seed to bring a larger volume of the arabica variety under cultivation. For the uninitiated, coffee comes in two major varieties, arabica and robusta. Arabica is a premium product and commands greater value in the US, the worlds largest coffee market. Robusta is an easier- to-grow variety which does not command as much premium. Unfortunately for India, the ease of growing and maintaining the robusta plant has resulted in it becoming, over the years, the major share of coffee produced in the country. This has not helped Indian coffee producers much, especially in a scenario where companies like Tata Coffee want to enter the branded market more aggressively. Tata Coffees commitment to research and development in this area has been of immense value to the industry. In fact, as Mr Bijoor says, the company very often dons the industry hat and has been responsible for lending it a helping hand on many occasions (see: Leading the industry). With the WTO agreement ready to become applicable in a few years, the tariff for coffee is set to come down substantially. To counter the WTO impact, Tata Coffee is making determined efforts to move up the value chain and realise greater benefits thereof. Apart from plans to increase its thrust in existing brands and go national with some of them, the company has already chalked out a strategy to enter the tertiary yet higher-value end of the chain, namely liquid coffee. Here Tata Coffee is planning a huge foray through coffee-vending machines. It has already launched nearly 1,600 centres where its vending machines are in operation and hopes to treble this number in the current financial year.

The company sees tremendous potential for growth, given the abysmally low consumption of coffee in the country only 55 grams per capita annually as compared with close to 10kg per capita annually in Finland. As already announced publicly, the company will make a bid to enter the area of "coffee pubs" similar to the ones in the West. It is working hard on using these pubs to promote coffee as a lifestyle drink and is in discussions with leading international players to cement its approach to this segment of the market. All in all, Tata Coffees turnaround from a commodity outfit to a major FMCG player in the value-added market has been a slow but steady one. Despite initial hiccups, the company is clear about its ultimate goal: brewing success in the coffee business, and never mind the stranglehold its competition presently has on the market.

processing methods, and distribution in order to better serve this growing market.Demand for Indian coffee is currently greater than supply.2.2 SWOT ANALYSIS:The following SWOT analysis captures the key strength and weaknesses within thecompany, and describes the opportunities and threats facing Tata coffee STRENGTHS:Strong relationships with growers, and American and Indian wholesalers and roasters. The use of the highest-quality beans. Sophisticated technology that drives production costs down while ensuring quality. WEAKNESSES:Costs of doing business with American firms while located in India. Dependence on a few suppliers who are the only ones capable of growing the highestquality Arabica beans. A limited marketing budget, necessary for developing brand awareness. OPPORTUNITY participation within a growing industry. coffee is universal beverage.The ability to increase the profit margin through the leveraging of technology. THREATS:The commodity aspect of coffee. Costs associated with international trade. Future/potential competition from a large corporation. COMPETITION:Tata coffee deals exclusively in the exportation a