TO THE MEMBERS OF TATA CHEMICALS LIMITED
The Directors hereby present their Eighty-Fifth (85th) Annual Report on the
performance of Tata Chemicals Limited ('the Company') together with the Audited Financial
Statements for the Financial Year ('FY') ended March 31,2024.
1. Financial Results
Rs in crore
Particulars |
Standalone |
Consolidated |
|
Year ended March 31,2024 |
Year ended March 31, 2023 |
Year ended March 31,2024 |
Year ended March 31,2023 |
Revenue from continuing operations |
4,384 |
4,930 |
15,421 |
16,789 |
Earnings before Interest, Taxes, Depreciation and
Amortisation (EBITDA) |
875 |
1,235 |
2,847 |
3,822 |
Depreciation and amortisation expense |
295 |
245 |
980 |
892 |
Earnings before Interest and Taxes (EBIT) (before other
Income) |
580 |
990 |
1,867 |
2,930 |
Other Income |
383 |
301 |
286 |
218 |
Earnings before Interest and Taxes (EBIT) (after other
Income) |
963 |
1,291 |
2,153 |
3,148 |
Finance costs |
49 |
26 |
530 |
406 |
Profit before exceptional items, share of profit/(loss) of
joint ventures and associate and tax |
914 |
1,265 |
1,623 |
2,742 |
Exceptional items (net) |
102 |
- |
(861) |
- |
Profit/(loss) before share of profit/(loss) of joint
ventures and associate and tax |
1,016 |
1,265 |
762 |
2,742 |
Share of profit / (loss) of joint ventures and associate |
- |
- |
68 |
(2) |
Profit before tax |
1,016 |
1,265 |
830 |
2,740 |
Tax expense |
120 |
238 |
381 |
288 |
Profit from continuing operations after tax |
896 |
1,027 |
449 |
2,452 |
Loss from discontinued operations after tax |
- |
- |
(14) |
(18) |
Profit for the year |
896 |
1,027 |
435 |
2,434 |
Attributable to: |
|
|
|
|
- Equity shareholders of the Company |
896 |
1,027 |
268 |
2,317 |
- Non-controlling interests |
- |
- |
167 |
117 |
Other comprehensive income COCI') |
2,283 |
(59) |
2,814 |
(531) |
Total comprehensive income |
3,179 |
968 |
3,249 |
1,903 |
Balance in Retained earnings at the beginning of the year |
7,357 |
6,642 |
9,582 |
7,616 |
Profit for the year (attributable to equity shareholders of
the Company) |
896 |
1,027 |
268 |
2,317 |
Remeasurement of defined employee benefit plans (net of tax) |
(9) |
6 |
(30) |
(33) |
Dividends |
(446) |
(318) |
(446) |
(318) |
Acquisition of non-controlling interests |
- |
- |
(116) |
- |
Balance in Retained earnings at the end of the year |
7,798 |
7,357 |
9,258 |
9,582 |
2. Dividend
For FY 2023-24, the Board of Directors has recommended a dividend of Rs 15 per share
i.e. 150% (Previous year: Rs 17.50 per share i.e. 175%) on the Ordinary Shares of the
Company. If declared at the ensuing Annual General Meeting ('AGM'), the total dividend
outgo during FY 2024-25 would amount to Rs 382 crore (Previous year: Rs 446 crore).
3. Performance Review & State of Company's Affairs
3.1 Consolidated:
On a consolidated basis, the Revenue from operations for FY 2023-24 stood at Rs 15,421
crore (Previous year: Rs 16,789 crore) and EBITDA for FY 2023-24 stood at Rs 2,847 crore
(Previous year: Rs 3,822 crore). The results were impacted negatively mainly on account of
lower soda ash volumes and pricing pressure all regions. Profit before tax (before
exceptional items) for FY 2023-24 stood at Rs 1,623 crore (Previous year: Rs 2,742 crore).
Exceptional item of Rs 861 crore includes one-time non-cash expenses ofRs 963 crore on
account of impairment of mainly the soda ash plant at Lostock, UK and Rs 102 crore entry
tax provision reversal in India. Profit after tax for continuing operations for FY 2023-24
stood at Rs 449 crore (Previous year: Rs 2,452 crore).
3.2 Standalone:
On a standalone basis, the Revenue from operations for FY 2023-24 stood at Rs 4,384
crore (Previous year: Rs 4,930 crore). EBIDTAfor FY 2023-24 stood atRs 875 crore (Previous
year: Rs 1,235 crore), the results were impacted negatively mainly on account of lower
soda ash volumes and pricing pressures. Profit before tax (before exceptional items) for
FY 2023-24 stood at Rs 914 crore (Previous year: Rs 1,265 crore). Exceptional item is of
Rs 102 crore towards entry tax provision reversal. Profit after tax for FY 2023-24 stood
at Rs 896 crore (Previous year: Rs 1,027 crore).
For more details on the Consolidated and Standalone performance, please refer to
Management Discussion & Analysis.
4. Management Discussion & Analysis
The Management Discussion & Analysis, as required in terms of the Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,
2015 ('SEBI Listing Regulations'), forms part of this Integrated Annual Report.
5. Business Overview
The Company has two business segments viz. Basic Chemistry Products and Specialty
Products.
Basic Chemistry segment comprises inorganic chemicals led by Soda Ash, Salt and Sodium
Bicarbonate. Economies of scale, supply chain efficiencies and customer relationships and
services drive this business.This business segment has manufacturing operations spread
across four continents viz. North America (USA), Europe (UK), Africa (Kenya) and Asia
(India). These inorganic chemicals primarily service industries such as Glass (Automotive,
Architectural, Solar & Container), Detergent, EV batteries. Food, Pharma, Animal Feed
and Industrial Chemicals.
Specialty Products portfolio is driven by Chemistry-led differentiation. The Company
has three key products in this segment comprising Specialty Silica, Prebiotics and Agri
inputs. Specialty Silica range serves Rubber, Tyre & Food industries. Prebiotics are
targeted at Food, Animal Feed and Pharmaceutical applications. Rallis India Limited
CRallis'), a listed subsidiary of the Company, produces and markets range of Agri inputs
including Seeds for Indian and overseas farmers.
The Company is increasing its focus on Green Chemistry with Sustainability as a key
driver of value. Basic Chemistry will scale further by adding capacities of the core
products and leveraging cost competitiveness. The growth in Soda Ash demand is also driven
by Solar Glass (used in Solar Electricity generation) and Lithium Carbonate. The Specialty
Products will focus on maximising value with a sustainable portfolio, low carbon footprint
Specialty Silica and Prebiotics based on fermentation platform.
5.1 Basic Chemistry Products Standalone (India)
For FY 2023-24, the revenues from the Basic Chemistry Products business stood at Rs
4,219 crore, lower by 10% over previous year.
Soda Ash
Indian Soda Ash demand increased marginally during FY 2023-24 with commissioning of new
float lines.
Fiscal year 2023-24 saw stagnant demand growth of Soda Ash globally. This was largely
driven by persistent high inflation rates across economies and continued geopolitical
conflicts in Europe and Middle East. Europe saw sharpest demand decline. China, world's
largest Soda Ash market, also saw lower than expected demand growth mainly due to real
estate crisis and stagnant automotive sector. While demand remained muted across
consumption economies, the Soda Ash industry saw higher than expected capacity addition.
Approximately 2.5 million MetricTonne ('MMT') of additional capacities came onstream in
Calender Year 2023 resulting in the situation of over supplies.
India demand too was impacted due to high inflationary situation. Detergent and
domestic flat glass sectors, leading Soda Ash consumption segments saw slower demand
growth in FY 2023-24. Besides, due to demand contraction in Europe, suppliers from Turkey
and Middle East diverted materials to other importing geographies. Indian imports of Soda
Ash increased by ~ 80% in the fiscal year crossing 1 MMT mark. Low demand coupled with
increased imports created over supplies of Soda Ash resulting in sharp decline of prices
by 25% - 30% in India.
Sales of soda ash for FY 2023-24 stood at 6.4 lakh MT, a marginal decrease of 0.7% over
the previous year.
Sodium Bicarbonate
Sales of sodium bicarbonate stood at 1.3 lakh MT, a marginal increase over the previous
year.
The Company markets four value-added grades of Bicarb - Medikarb (pharma grade),
Sodakarb (food grade), Alkakarb (feed grade) and Speckarb (industrial grade).
Sodium Bicarbonate demand was stable in India mainly led by food and pharma industries.
New emerging application of industrial flue gas treatment is adding additional demand in
the sector. Flowever, prices saw reduction mainly due to sharp decline in Soda Ash prices.
Salt
The demand growth for salt was stable from the Company's key customer, Tata Consumer
Products Limited, during the year and the production was increased appropriately to meet
the increased requirement. The Company recorded production of salt at 13.44 lakh MT during
FY 2023-24. In addition, a project is under implementation to increase the salt
manufacturing capacity to meet the projected demand increase. On the manufacturing side,
solar salt production was affected due to brine dilution owing to extended rains and
flooding.
Other Inorganic Chemicals
Sale of cement stood at 2.83 lakh MT, a decrease of 41% over previous year. Bromine
production was impacted due to bittern dilution.
Subsidiaries
Tata Chemicals North America Inc., USA ('TCNA') (as per USGAAP)
During FY 2023-24, overall revenue for TCNA decreased marginally by 1%to US$ 649.4
million (Rs 5,377 crore) from US$ 655.7 million (Rs 5,271 crore) in the previous year due
to lower volumes in the export markets as well as drop in soda ash price.
EBITDA registered a decrease of 19% to US$ 130.1 million (Rs 1,077 crore) against US$
160.3 million (Rs 1,288 crore) in FY 2022-23. TCNA registered a profit after tax of US$
57.1 million (Rs 472 crore) during FY 2023-24 as against a profit of US$ 90.7 million (Rs
729 crore) in the previous year.
TCE Group Limited, UK ('TCE group') (as per IFRS)
TCE Group Limited's business consists of soda ash, sodium bicarbonate and energy units
and British Salt Limited which manufactures and sells food and industrial grade white
salt. Together they are referred toas'UKOperations' of the Company in this Report.
Total revenue from the UK Operations for FY 2023-24 was ? 231.0 million (Rs 2,404
crore) against ? 271.5 million (Rs 2,629 crore) in the previous year, registering a
decline of 15%.
Soda Ash and Bicarb volumes were down during the year due to weak market demand.
Margins were also affected significantly due to high fixed cost based on high inflation,
maintenance cost and interest rate increases.
The Combined heat and Power (CFIP) facility at Winnington's performance was affected
due to lower energy margins.
In the Salt business, sales volume were lower whereas higher prices contributed to
better realisation.
EBITDA for FY 2023-24 for the UK Operations was ? 33.4 million (Rs 347 crore) against
? 63.6 million (Rs 615 crore) and the loss after tax was ? 95.3 million (Rs 992 crore)
against the profit of ? 45.0 million (Rs 435 crore) in the previous year, on account of
exceptional item towards impairment of mainly the soda ash plant at Lostock, UK.
Tata Chemicals Magadi Limited, Kenya ('TCML')
(as per IFRS)
During FY 2023-24.TCML achieved a revenue of US$ 77.4 million (Rs 640 crore) for FY
2023-24 as against revenue of US$ 117.6 million (Rs 945 crore) in the previous year, a
decrease of 34%. For FY 2023-24, TCML registered an EBITDA of US$ 25.4 million (Rs 211
crore) against US$ 58.3 million (Rs 468 crore) in the previous year, TCML recorded a net
profit of US$ 16.1 million (Rs 134 crore) in FY 2023- 24 against a net profit of US$ 55.9
million (Rs 450 crore) in FY 2022-23. The results were impacted negatively mainly due to
lower volumes and pricing pressures.
5.2 Specialty Products Standalone Silica
The installed capacity for silica is 10,000 MT with 50% each for tyre and food line.
The Company has produced 7,895 MT silica and with 100% capacity utilization for tyre
grade. Food grade line remained under utilised. The Company is in the process of
converting food line to tyre line in FY 2024- 25 in order to meet tyre and rubber
customers demand. Highly Dispersible Silica (FIDS) production was 1,100 MT and supply was
1,070 MT during FY 2024. Tyre labelling norms will continue to drive demand of FIDS.
Silica margins in FY 2023-24 were impacted by a steep increase in raw material and energy
costs. The Company is focusing on scaling up silica business significantly including FIDS.
Prebiotics
The Company continues to strengthen its operations at its state-of-the-art greenfield
facility in Mambattu, Andhra Pradesh. This facility boasts an array of comprehensive food
safety certifications, including FSSAI, FSSC 22000, FAMI QS, Ha la I, and Kosher.
Additionally, the Company has received ISO 14001:2015, ISO 45001:2018, and ISO 9001:2015
certifications, highlighting its commitment to responsible manufacturing practices in
terms of environmental management, occupational health and safety, and quality management.
In addition to our core segments, the pet food market has emerged as a significant area
of growth, where we have gained a considerable foothold. Market expansion remains robust,
with continued growth from the USA and South East Asia. Additionally, promising
opportunities are emerging from the European Union. The Mambattu facility has been
qualified by several global customers, positioning the Company to reach full capacity
utilization in the coming year.
To further enhance its market presence, the Company has undertaken specific
intervention projects aimed at adding additional applications in the global market. These
projects are expected to drive sustained growth and operational excellence.
Subsidiary
Rallis India Limited ('Rallis')
(as per TCL consolidated books)
Rallis India Limited, the Company's listed subsidiary, has a strong Brand and Chemistry
play in the Agrochemicals sector.
Rallis' revenue from operations for FY 2023-24 was Rs 2,648 crore as compared to Rs
2,967 crore during FY 2022-23, a decrease of 11 % from the previous year. Profit before
tax was Rs 196 crore during the year compared to Rs 128 crore in the previous year. Rallis
earned a net profit after tax of Rs 148 crore, higher by 61%, as against a net profit
after tax of Rs 92 crore in the previous year. Domestic Crop Care business grew
volumetrically but due to steep price correction had an overall de-growth of 3%. After a
strong FY 2022-23, exports business suffered due to inventory de- stocking and price drop
across markets resulting in overall degrowth of 35%. Seeds business bounced back after
difficult last 2 years with volume-led growth of 21%.
6. Finance and Credit Ratings
The Company's focused endeavours during the year included accelerated repayment of term
loans at most of its overseas subsidiaries, re-negotiation of interest rate on long-term
loan, re-alignmentfor utilisation of competitive trade finance facilities for working
capital management, suitable conservation of cash, intensive planning for cash flows
optimisation, maintaining sufficient liquidity, observing disciplined risk mitigation
measures and greater use of digital solutions.
During the year under review.Tata Chemicals International Pte. Limited ('TCIPL'),
Singapore repaid US$ 50 million of long-term loan.TCNA repaid US$ 95 million of long-term
loan, Flomefield Pvt UK Limited repaid US$ 6 million of long-term loan and British Salt
Limited repaid ? 6 million of long-term loan. Long term loan interest rate was re-
negotiated for British Salt Limited facility.
During FY 2023-24, Rallis, a subsidiary and Indo Maroc Phosphore SA (IMACID), a joint
venture, paid dividends of Rs 24 crore (FY 2022-23: Rs 29 crore) and Rs 136 crore (FY
2022-23: Rs 92 crore) respectively to the Company. No dividend was paid by Tata Chemicals
South Africa (Pty) Limited [FY 2022-23: South African Rand 5.0 million (Rs 2 crore)] and
TC Africa Holdings Limited [FY 2022-23: ? 0.3 million (Rs 3 crore)].
For the year under review, the Company's credit ratings were reaffirmed.
The Company as on March 31, 2024 had the following credit ratings:
Long-Term Corporate Family Rating - Foreign Currency of Bal/Stable from Moody's
Investors Service;
Long-Term Foreign Currency Issuer Default Rating (IDR) of BB+ with stable outlook from
Fitch Ratings;
Long-Term bank facilities (fund-based limits) of Rs 1,300 crore and short-term bank
facilities (non- fund based limits) ofRs 2,000 crore are rated at CARE AA+ (Outlook:
Stable) and CARE A1 + respectively, by CARE Ratings; and
Commercial Paper of Rs 100 crore is rated at CRISIL A1 + by CRISIL Ratings.
7. Dividend Distribution Policy
In accordance with Regulation 43A of the SEBI Listing Regulations, the Board of
Directors of the Company has adopted a Dividend Distribution Policy which endeavours for
fairness, consistency and sustainability while distributing profits to the shareholders.
The same is available on the Company's website at https://www.
tatachemicals.com/DividendDistPolicy.htm.
8. Transfer to Reserves
The Board of Directors has decided to retain the entire amount of profits for FY
2023-24 in the retained earnings.
9. Deposits from Public
The Company has not accepted any deposits from public and as such no amount on account
of principal or interest on deposits from public was outstanding as on March 31,2024.
10. Business Responsibility & Sustainability Report
The Company endeavours to cater to the needs of the communities it operates in thereby
creating maximum value for the society along with conducting its business in a way that
creates a positive impact and enhances stakeholder value. As per Regulation 34(2)(f) of
the SEBI Listing Regulations, the Business Responsibility & Sustainability Report
depicting initiatives taken by the Company from an environmental, social and governance
perspective which has been reasonably assured by KPMG Assurance and Consulting Services
LLP, forms part of this Integrated Annual Report.
11. Related Party Transactions
In line with the requirements of the Companies Act, 2013 ('the Act') and SEBI Listing
Regulations, as amended from time to time, the Company has formulated a Policy on Related
Party Transactions ('RPT Policy') for identifying, reviewing, approving and monitoring of
Related Party Transactions and the same is available on the Company's website at
https://www.tatachemicals.com/RPTPolicy.htm.
All related party transactions entered into during FY 2023-24 were on arm's length
basis and in the ordinary course of business and were reviewed and approved by the Audit
Committee. With a view to ensure continuity of day-to-day operations, an omnibus approval
is obtained for related party transactions which are of repetitive nature and entered in
the ordinary course of business and on an arm's length basis. A statement giving details
of all related party transactions entered pursuant to the omnibus approval so granted is
placed before the Audit Committee on a quarterly basis for its review.The related party
transactions entered into pursuant to the omnibus approval so granted are also reviewed as
part of the internal audit by an independent external firm on a half-yearly basis.
During the year under review, the Company did not enter into any contracts or
arrangements with related parties pursuant to Section 188(1) of the Act read with the
relevant rule and no material related party transactions were entered into. Accordingly,
the disclosure of related party transactions as required under Section 134(3)(h) of the
Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is not
applicable to the Company for FY 2023-24 and hence does not form part of this Integrated
Annual Report.
In terms of Regulation 23 of the SEBI Listing Regulations, the Company submits details
of related party transactions on a consolidated basis as per the specified format to the
stock exchanges on a half-yearly basis.
The details of the transactions with related parties are provided in the accompanying
Financial Statements.
12. Risk Management
RiskManagementatTata Chemicals forms an integral part of Management focus.
The Risk Management Policy of the Company which is approved by the Risk Management
Committee of the Board ('RMC') and the Board of Directors, provides the
framework of Enterprise Risk Management ('ERM') by describing mechanisms for the
proactive identification and prioritisation of risks based on the scanning of the external
environment and continuous monitoring of internal risk factors. The ERM framework
identifies, evaluates, manages and reports risks arising from the Company's operations and
exogenous factors.
The Company has deployed bottom-up and top-down approaches to drive enterprise-wide
risk management. The bottom-up process includes identification and regular assessment of
risks by the respective business units and implementation of mitigation strategies. This
is complemented by a top-down approach where the Risk Management Group (Senior Leadership
Team) as well as the RMC identifies and assesses long-term, strategic and macro risks for
the Company.
The RMC oversees the risk management process in the Company.The RMC is chaired by an
Independent Director and the Chairperson of the Audit Committee is also a Member of the
RMC. Further, the Chairman of the RMC briefs the Board at its Meetings about the
significant discussions at each of the RMC Meetings. This robust governance structure has
also helped in the integration of the ERM with the Company's Strategic Planning Process
where emerging risks are used as inputs in such process. Identified risks are used as one
of the key inputs in the strategy and business plans.
A systematic review of risks identified is subject to a series of focused meetings of
the empowered Risk Management Group (Senior LeadershipTeam), respective Business-level /
Subsidiary-level Committees and the RMC. The RMC meets periodically to review all the key
risks and assess the status of mitigation measures.
Considering the volatility, uncertainties and unprecedented challenges involved in the
businesses, the risk management function has gained more importance over the last few
years and it is imperative to manage and address such challenges effectively. With a view
to have a focused approach in doing so, the Company has appointed a Chief Risk Officer to
oversee the Risk Management function of the Company.
Based on benchmarking and inputs from global standards on ERM, the Risk Management
process has been deployed across geographies and businesses.
Some of the risks identified are set out in the Management Discussion & Analysis
which forms part of this Integrated Annual Report.
13. Corporate Social Responsibility
The Corporate Social Responsibility ('CSR') activities of the Company are governed
through the Corporate Social Responsibility Policy ('CSR Policy') approved by the Board.
The CSR Policy guides in designing CSR activities for improving quality of life of society
and conserving the environment and biodiversity in a sustainable manner.The CSR Committee
of the Board oversees the implementation of CSR Projects in line with the Company's CSR
Policy.
The Company has adopted a participatory approach in designing need-based CSR programmes
which are implemented through Tata Chemicals Society for Rural Development ('TCSRD') in
partnership with the Tata Trusts and with various governmentand non-government
institutions. The Company's CSR programme framework focusses on building economic capital,
ensuring environmental integrity, enablers for social, economic and environmental
development and building social capital.
Building economic capital: The Company focusses on poverty alleviation and creating
livelihoods, linked to farm and non-farm based activities.
Ensuring environmental integrity: The Company's main focus is on management of
natural resources and conservation of environment. The key programmes include land and
water management activities, waste management, preservation of biodiversity and mitigation
of climate change impacts.
Enablers for social, economic and environmental development: The Company's
programmes focus on health and nutrition, education and drinking water.
The Company conducts regular health and nutrition camps and also provides health care
services. The education programme focusses on students starting from primarytothe
post-graduation level. Educational support is provided for enrolment of children and
improving quality of education. The Company helps to provide clean water through roof
rainwater harvesting structures, repair of hand pumps, installation and maintenance of
drinking water pipelines, supporting households with water purifier systems through Swach
Tarang Project.
Building social capital: Building the social capital for long-term sustainability
is a key cross-cutting theme in all these below programmes.
Women empowerment, reducing inequality of marginalised communities (through Affirmative
Action), partnerships for achieving goals and setting up sustainable social enterprise
models (Okhai and Ncourage Social Enterprise Foundation) are key initiatives for achieving
the same.
The Company also endeavours to respond to disasters that affect any part of India and
in the neighbourhood of all its manufacturing plants.
The CSR Policy is available on the website of the Company at
https://www.tatachemicals.com/CSRPolicy2021.htm.
The Annual Report on CSR activities for FY 2023-24 is enclosed as Annexure 1 to
this Report.
14. Whistleblower Policy and Vigil Mechanism
The Company has devised an effective whistleblower mechanism enabling stakeholders,
including individual employees and their representative bodies, to communicate their
concerns about illegal or unethical practices freely.The Company has also established a
vigil mechanism for stakeholders to report concerns about any unethical behaviour,actual
orsuspected fraud orviolation of the Company's Code of Conduct. Protected disclosures can
be made by a whistleblower through several channels. The Whistleblower Policy of the
Company provides for adequate safeguards against victimisation of employees whoavail ofthe
mechanism. No personnel of the Company has been denied access to the Chairperson ofthe
Audit Committee. The Policy also facilitates all employees ofthe Company to report any
instance of leak of unpublished price sensitive information.
A dedicated third-party Ethics Flelpline has been set up which is managed by an
independent professional organisation for confidentially raising any ethical concerns or
practices that violate the Tata Code of Conduct. The Ethics helpline services include
toll-free number, web access, postal services and e-mail facilities.
The Policy is available on the website ofthe Company at:
https://www.tatachemicals.com/WhistleblowerPolicy.htm.
15. Prevention of Sexual Harassment
Pursuant to the Sexual Flarassment of Women at Workplace (Prevention, Prohibition &
Redressal) Act, 2013
('POSH Act') and Rules made thereunder, the Company has formed an Internal Committee
('1C') for its workplaces to address complaints pertaining to sexual harassment in
accordance with the POSFI Act. The Company has a detailed policy for prevention of sexual
harassment at workplace which ensures a free and fair enquiry process with clear timelines
for resolution.
The Policy is uploaded on the website of the Company at
http://www.tatachemicals.com/POSFIPolicy.htm.
No complaints were pending at the beginning of the financial year. During the year
under review, one concern was reported which was investigated and appropriate action was
taken. No complaint was pending as at the end ofthe financial year.
To build awareness in this area, the Company has been conducting awareness sessions
during induction of new employees and also periodically for permanent employees,
third-party employees and contract workmen through online modules and webinars.
16. Particulars of Loans, Guarantees and Investments
During the year under review, the Company has invested in the preference shares of its
subsidiary company, TCI PL, Singapore an amount of US$ 50 million. The Company also
acquired 97,00,000 equity shares having face value ofRs 1 each of its listed subsidiary,
Ra His India Limited representing 4.99% of the paid-up capital of Ra His.
During the year under review, the Company has provided corporate guarantee of US$ 54.6
million and ? 84 million in relation to loans at Flomefield Private UK Limited and
Natrium Holdings Limited respectively, replacing an earlier corporate guarantee.
Details of loans, guarantees and investments covered under the provisions of Section
186 of the Act are given in the notes to the Financial Statements.
17. Consolidated Financial Statements
The Consolidated Financial Statements ofthe Company and its subsidiaries for FY 2023-24
are prepared in compliance with the applicable provisions of the Act and as stipulated
under Regulation 33 ofthe SEBI Listing Regulations as well as in accordance with the
Indian Accounting Standards notified under the Companies (Indian Accounting Standards)
Rules, 2015. The Audited Consolidated Financial Statements together with the
Auditor's Report thereon form part of this Integrated Annual Report.
Pursuant to the provisions of Section 136 of the Act, the Financial Statements of the
Company, Consolidated Financial Statements along with relevant documents and separate
annual accounts in respect of subsidiaries are available on the website of the Company.
The annual accounts of the subsidiaries and related detailed information will be made
available to investors seeking information till the date of the AGM.They are also
available on the website of the Company at https://www.
tatachemicals.com/investors/agm-documents.
18. Subsidiary Companies, Joint Ventures and Associate
As on March 31, 2024, the Company had 22 (direct and indirect) subsidiaries (2 in India
and 20 overseas), 3 Joint Ventures ('JV') and 1 Associate.There has been no material
change in the nature of the business of the subsidiaries.
In order to simplify the holding structure and rationalise the number of intermediate
entities, during the year, the Company carried restructuring of its subsidiariesas under:
a. Tata Chemicals (Soda Ash) Partners, was converted from a partnership to a limited
liability company (LLC) resulting in change of name to Tata Chemicals (Soda Ash) Partners
LLC, TC (Soda Ash) Partners FloldingsandTCSAP LLC merged into Tata Chemicals (Soda Ash)
Partners LLC and Valley Holdings Inc. merged into Tata Chemicals North America Inc. The
above restructuring process concluded on June 1,2023.
b. Brinefield Storage Limited was dissolved with effect from September 19,2023
c. Cheshire Cavity Storage 2 Limited was dissolved with effect from December 19, 2023
Pursuant to SEBI Listing Regulations, the Company's Policy on determining material
subsidiaries is uploaded on the Company's website at https://www.tatachemicals.com/
policy-on-determining-material-subsidiaries.pdf.
A report on the financial position of each of the subsidiaries, joint ventures and
associate as per Section 129(3) of the Act is provided in Form AOC-1 enclosed to the
Financial Statements.
19. Internal Financial Controls
Internal financial control systems of the Company are commensurate with its size and
the nature of its operations. These have been designed to provide reasonable assurance
with regard to recording and providing reliable financial and operational information,
complying with applicable accounting standards and relevant statutes, safeguarding assets
from unauthorised use, executing transactions with proper authorisation and ensuring
compliance of corporate policies. The Company has a well-defined delegation of authority
with specified limits for approval of expenditure, both capital and revenue. The Company
uses an established Enterprise Resource Planning (ERP) system to record day-to-day
transactions for accounting and financial reporting.
The Audit Committee deliberated with the members of the Management, considered the
systems as laid down and met the internal audit team and statutory auditors to ascertain
their views on the internal financial control systems. The Audit Committee satisfied
itself as to the adequacy and effectiveness of the internal financial control systems as
laid down and kept the Board of Directors informed. Flowever, the Company recognises that
no matter how the internal control framework is, it has inherent limitations and
accordingly, periodic audits and reviews ensure that such systems are updated at regular
intervals.
Details of internal control system are given in the Management Discussion &
Analysis which forms part of this Integrated Annual Report.
20. Directors' Responsibility Statement
Based on the framework of internal financial controls and compliance systems
established and maintained by the Company, work performed by the internal, statutory, cost
and secretarial auditors and external consultant(s), including audit of internal financial
controls overfinancial reporting by the statutory auditors and the reviews performed by
the Management and the relevant Board Committees, including the Audit Committee, the Board
is of the opinion that the Company's internal financial controls were adequate and
effective during FY 2023-24.
Accordingly, pursuant to Sections 134(3)(c) and 134(5) of the Act, the Directors, to
the best of their knowledge and ability, confirm that for the year ended March 31,2024:
a) in the preparation of the annual accounts, the applicable accounting standards have
been followed and that there are no material departures;
b) they have selected such accounting policies and applied them consistently and made
judgements and estimates that are reasonable and prudent so as to give a true and fair
view of the state of affairs of the Company at the end of the financial year and of the
profit of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and are operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
21. Corporate Governance and Compliance
The Company follows the best governance practices to boost long-term shareholder value
and respect minority rights.
The Company considers the same as its inherent responsibility to disclose timely and
accurate information to its stakeholders regarding its operations and performance, as well
as the leadership and governance of the Company. The Company is committed to the Tata Code
of Conduct which articulates values and ideals that guide and govern the conduct of the
Tata companies as well as its employees in all matters relating to business. The Company's
overall governance framework, systems and processes reflect and support its Mission,
Vision and Values.
At Tata Chemicals, human rights is also an integral aspect of doing business and the
Company is committed to respect and protect human rights to remediate adverse
human rights impacts that may be resulting from or caused by the Company's businesses.
In furtherance to this, the Company has in place the 'Tata Business and Human Rights
Policy'which aligns with the principles contained in the Universal Declaration of Human
Rights, International Labour Organsations (ILO), Declaration on Fundamental Principles and
Rights at Work and the United Nations Guiding Principles on Business and Human Rights and
is consistent with the Tata Code of Conduct.
The Company's governance guidelines cover aspects mainly relating to composition and
role of the Board, Chairman and Directors, Board diversity, retirement age for the
Directors and Committees of the Board.
The Company has in place an online compliance management system for monitoring the
compliances across its various plants and offices. A compliance certificate is also placed
before the Board of Directors every quarter. In compliance with the SEBI Listing
Regulations, the Corporate Governance Report and the Secretarial Auditor's Certificate
form part of this Integrated Annual Report.
22. Directors and Key Managerial Personnel Directors Retirement
During the year under review, Mr. Zarir Langrana (DIN: 06362438) completed his tenure
as an Executive Director effective February 29,2024, on attaining the superannuation age
in line with the Retirement Policy adopted by the Company. The Board places on record its
appreciation for his invaluable contribution and guidance during his over four decades of
long tenure with the Company.
Re-appointment
The Shareholders of the Company at the 84th AGM held on June 26, 2023,
approved the re-appointment of Mr. R. Mukundan for a further period of five (5) years from
November 26,2023 upto November 26,2028 (both days inclusive)
In accordance with the provisions of Section 152 of the Act and the Articles of
Association of the Company, Mr. S. Padmanabhan (DIN: 00306299), Non-Executive,
Non-Independent Director of the Company, retires by rotation at the ensuing AGM and being
eligible, has offered himself for re-appointment.
Dr. C.V. Natraj (DIN: 07132764) will complete his first term of five (5) years as
Independent Director of the Company on August 7, 2024. On the recommendation of the
Nomination & Remuneration Committee (NRC) and the
Board of Directors, the proposal for re-appointment of Dr. C. V. Natraj as Independent
Director of the Company fora second term commencing from August 8,2024 upto July 30, 2028
(i.e. till he attains the retirement age in line with the Retirement Policy adopted by the
Company), is being included in the Notice of ensuing 85th AGM for approval of
the Shareholders.
Mr. K. B. S. Anand (DIN: 03518282) will complete his first term of five (5) years as
Independent Director of the Company on October 14, 2024. On the recommendation of the NRC
and the Board of Directors, the proposal for re-appointment of Mr. K. B. S. Anand as
Independent Director of the Company for a second term of five (5) years commencing from
October 15, 2024 upto October 14, 2029 is being included in the Notice of ensuing 85th
AGM for approval of the Shareholders.
Independent Directors
In terms of Section 149 of the Act, Ms. Vibha Paul Rishi, Ms. Padmini Khare Kaicker,
Dr. C. V. Natraj, Mr. K. B. S. Anand and Mr. Rajiv Dube are the Independent Directors of
the Company. The Company has received declarations from all the Independent Directors
confirming that they meet the criteria of independence as prescribed under Section 149(6)
of the Act and Regulation 16(1 )(b) of the SEBI Listing Regulations and are independent of
the Management. In terms of Regulation 25(8) of the SEBI Listing Regulations, they have
confirmed that they are not aware of any circumstance or situation which exist or may be
reasonably anticipated, that could impair or impact their ability to discharge their
duties with an objective independent judgement and without any external influence.The
Board of Directors of the Company has taken on record the declaration and confirmation
submitted by the Independent Directors after undertaking due assessment of the veracity of
the same.
The Board is of the opinion thatall Directors including the Independent Directors of
the Company possess requisite qualifications, integrity, expertise and experience in the
fields of science and technology, digitalisation, strategy, finance, governance, human
resources, safety, sustainability, etc.
The Independent Directors of the Company have confirmed that they have enrolled
themselves in the Independent Directors' Databank maintained with the Indian Institute of
Corporate Affairs ('MCA') in terms of Section 150 of the Act read with Rule 6 of the
Companies (Appointment & Qualification of Directors) Rules, 2014.
Details of Familiarisation Programme for the Independent Directors are provided
separately in the Corporate Governance Report which forms part of this Integrated Annual
Report.
During the year under review, the Non-Executive Directors of the Company had no
pecuniary relationship or transactions with the Company, other than sitting fees,
commission and reimbursement of expenses incurred by them forthe purpose of attending
meetings of the Board/ Committees of the Company.
Key Managerial Personnel ('KMP')
In terms of the provisions of Section 2(51) and Section 203 of the Act, the following
are the KMP of the Company as on March 31,2024:
Mr. R. Mukundan, Managing Director & CEO
Mr. Nandakumar S.Tirumalai, Chief Financial Officer
Mr. Rajiv Chanda n. Chief General Counsel & Company Secretary
Procedure for Nomination and Appointment of Directors
The Nomination & Remuneration Committee (NRC) is responsible for developing
competency requirements for the Board based on the industry and strategy of the Company.
The Board composition analysis reflects in-depth understanding of the Company, including
its strategies, environment, operations, financial condition and compliance requirements.
The Committee is also responsible for reviewing the profiles of potential candidates
vis-a-vis the required competencies and meeting the potential candidates prior to making
recommendations of their nomination to the Board. Atthe time of appointment, specific
requirements for the position including expert knowledge expected is communicated to the
appointee.
The list of core skills, expertise and competencies of the Board of Directors as are
required in the context of the businesses and sectors applicable to the Company are
identified by the Board and are available with the Board. The Directors have also reviewed
the list of core skills, expertise and competencies which were mapped against them.
The same is disclosed in the Corporate Governance Report forming part of this
Integrated Annual Report.
Scientific Advisory Board
The Board has constituted a Scientific Advisory Board consisting of scientists with
relevant domain expertise under the Chairmanship of Dr. C. V. Natraj, Independent Director
of the Company with a view to synergise the Research & Development initiatives at the
Company's Innovation Centre at Pune and Research & Development Centres of Rallis India
Limited (Crop Care and Seeds). Further details in this regard are provided in the
Corporate Governance Report.
Criteria for determining Qualifications, Positive Attributes and Independence of a
Director
The NRC has formulated the criteria for determining qualifications, positive attributes
and independence of Directors in terms of provisions of Section 178(3) of the Act and the
SEBI Listing Regulations. The same is available at
https://www.tatachemicals.com/criteriadetermining.pdf.
Board Evaluation
The Board has carried out the annua I evaluation of its own performance and that of its
Committees and individual Directors for the year pursuant to the provisions of the Act and
the SEBI Listing Regulations. The exercise of performance evaluation was carried out
electronically through a secure application.This resulted in saving paper, reducing the
cycle time to make documents available to the Board/Committee Members and in increasing
confidentiality and accuracy.
The performance of the Board and individual Directors was evaluated by the Board after
seeking inputs from all the Directors. The criteria for performance evaluation of the
Board included aspects such as Board composition and structure, effectiveness of Board
processes, contribution in the long-term strategic planning, etc.The performance of the
committees was evaluated by the Board after seeking inputs from the committee members on
the basis of criteria such as the composition of committees, effectiveness of committee
meetings, etc.
The Chairman of the Board had one-on-one meetings with each Independent Directorand the
Chairman of the NRC had one-on-one meetings with each Executive and Non-Executive,
Non-Independent Directors.
In a separate meeting, the Independent Directors evaluated the performance of
Non-Independent Directors and performance of the Board as a whole including the Chairman
of the Board taking into account the views of Executive Directors and Non-Executive
Directors.The NRC
reviewed the performance of the Board, its Committees and of the Individual Directors.
The same was discussed in the Board Meeting that followed the meeting of the Independent
Directors and the NRC, at which the feedback received from the Directors on the
performance of the Board and its Committees was also discussed.
The Company follows a practice of addressing each of the observations and suggestions
by drawing up an action plan and monitoring its implementation through the Action Taken
Report which is reviewed by the Board of Directors from time to time.
23. Remuneration Policy
The Company has in place a Remuneration Policy for the Directors, KMP and other
employees pursuant to the provisions of the Act and the SEBI Listing Regulations which is
available at https://www.tatachemicals.com/rempolicy.
24. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
The particulars relating to conservation of energy, technology absorption, foreign
exchange earnings and outgo as required to be disclosed pursuant to the provisions of
Section 134 of the Act read with the Companies (Accounts) Rules, 2014 are provided in
Annexure 2 forming part of this Report.
25. Particulars of Employees
Disclosures pertaining to remuneration and other details as required under Section
197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 ('Rules') are enclosed as Annexure 3 forming part of
this Report. The statement containing particulars of employees as required under Section
197(12) of the Act read with Rule 5(2) and 5(3) of the Rules also forms part of this
Report. Further, the Report and the Accounts are being sent to the Members excluding the
aforesaid statement. In terms of Section 136 of the Act, the said statement will be open
for inspection upon request by the Members. Any Member interested in obtaining such
particulars may write to the Company Secretary at investors@tatachemicals.com.
26. Auditors
I. Statutory Auditors
At the 83,d AGM held on July, 6, 2022, B S R & Co. LLP, Chartered
Accountants (Firm Registration No. 101248W/ W-100022) were appointed as Statutory Auditors
of the
Company for a second term of five (5) consecutive years upto the 88th AGM by
the Members to be held in 2027.
The report of the Statutory Auditors along with notes to Schedules is a part of this
Integrated Annual Report. There has been no qualification, reservation, adverse remark or
disclaimer given by the Auditors in their Report.
II. Cost Auditors
As per Section 148 of the Act read with the Companies (Cost Records and Audit) Rules,
2014, the Company is required to prepare, maintain as well as have the audit of its cost
records conducted by a Cost Accountant and accordingly, it has made and maintained such
cost accounts and records. The Board, on the recommendation of the Audit Committee has
appointed D. C. Dave & Co., Cost Accountants (Firm Registration No. 000611) ('D. C.
Dave & Co.') as the Cost Auditors of the Company for FY 2024-25.
D. C. Dave & Co. have confirmed that they are free from disqualification specified
under Section 141(3) and proviso to Section 148(3) read with Section 141 (4) of the Act
and that the appointment meets the requirements of the Act. They have further confirmed
their independent status and an arm's length relationship with the Company.
The remuneration payable to the Cost Auditors is required to be placed before the
Members in a General Meeting for their ratification. Accordingly, a resolution seeking
Members' ratification for the remuneration payable to D. C. Dave & Co., forms part of
the Notice of the 85th AGM forming part of this Integrated Annual Report.
III. Secretarial Auditors
In terms of Section 204 of the Act and Rules made thereunder, Parikh & Associates,
Practicing Company Secretaries (Firm Registration No. PI 988MFI009800) have been appointed
as Secretarial Auditors of the Company to carry out the secretarial audit for FY 2023-24.
The report of the Secretarial Auditors for FY 2023-24 is enclosed as Annexure 4 forming
part of this Report.
There has been no qualification, reservation, adverse remark or disclaimer given by the
Secretarial Auditors in their Report.
27. Reporting of Fraud
During the year under review, the Statutory Auditors, Cost Auditors and Secretarial
Auditors have not reported any instances of frauds committed in the Company by
its officers or employees to the Audit Committee under Section 143(12) of the Act,
details of which need to be mentioned in this Report.
28. General Disclosures
I. Details of Board Meetings
During the year under review, eight (8) Board Meetings were held, details of which are
provided in the Corporate Governance Report.
II. Composition of Audit Committee
The Audit Committee comprised four (4) Members out of which three (3) are Independent
Directors and one (1) is a Non-Executive Director. During the year under review, nine (9)
Audit Committee Meetings were held, details of which are provided in the Corporate
Governance Report and there were no instances when the recommendations of the Audit
Committee were not accepted by the Board.
III. Composition of CSR Committee
The CSR Committee comprised three (3) Members out of which one (1) is an Independent
Director. During the year under review, three (3) Meetings of the CSR Committee were held,
details of which are provided in the Corporate Governance Report and there were no
instances when the recommendations of the CSR Committee were not accepted by the Board.
IV. Secretarial Standards
The Directors have devised proper systems and processes for complying with the
requirements of applicable Secretarial Standards issued by the Institute of Company
Secretaries of India, as amended and such systems were adequate and operating effectively.
29. Other disclosures
a) No significant and material orders were passed by the regulators or the courts or
tribunals impacting the going concern status and the Company's operations in future.
b) In 2020, Allied Silica Limited (ASL) filed an application under Section 9 of the
Insolvency and Bankruptcy Code, 2016 ('IBC') against the Company and the same is pending
before the National Company Law Tribunal, Mumbai Bench as at the end of the year. The
Company has contested the proceedings among other things, on the grounds that no
operational debt is due and payable, the alleged debt is not an operational debt, the
party is not an operational creditor under the IBC and that there is pre-existence of
disputes between the parties.
c) There has been no change in the nature of business of the Company as on the date of
this Report.
d) There were no material changes and commitments affecting the financial position of
the Company between the end of the financial year and the date of this Report.
30. Annual Return
Pursuant to Section 92(3) read with Section 134(3)
(a) of the Act, the Annual Return in Form MGT-7 as on March 31,2024 is available on the
Company's website at https://www.tatachemicals.com/MGT72024.pdf.
31. Acknowledgements
The Directors appreciate the hard work, dedication, and commitment of all its employees
including workmen at the manufacturing plants.
The Directors also acknowledge the support extended by the Company's Unions and would
also like to thank the financial institutions, banks, government authorities, customers,
vendors and other stakeholders for their continued support and co-operation.
On behalf of the Board of Directors |
N. Chandrasekaran Chairman DIN: 00121863 |
Mumbai, April 29, 2024 |