Diana Tea Company Ltd Management Discussions

The total world tea production was 7053 million Kgs in 2024 as compared to 6727 million Kgs in 2023, out of which contribution from Indian tea crop was 1285 million Kgs when compared to 1393 million Kgs last year. Total Indian tea export was 254 million Kgs in 2024 against last year 231 million Kgs. The contribution of small growers in Indian tea production continues to swell every year and has already breached 50% of total crop. Whereas production from organized sector is showing a declining trend. Global tea consumption is likely to grow due to rising population of tea drinkers as tea being recognized as health drink. Indian tea consumption is likely to continue to grow at a steady rate.

Tea crop is entirely dependent on weather conditions being agriculture in nature. With global warming and extremely uncertain weather conditions the crop tends to suffer. Extreme weather conditions also give rise to pest infestation which is again detrimental for crop. We follow prudent field practices and 100% irrigation facilities to overcome such natural vagaries.

Global tea production is rising every year and so is the consumption. Being agricultural in nature, production is directly linked to the weather conditions prevailing during the year and tends to affect the production in adverse conditions. Furthermore, mushrooming of small growers in the Indian tea sectors is challenging the survivability of organized tea gardens as there is no level playing field between the two. The latter is burdened with huge social cost falling under Plantation Labour Act, whereas small growers are not affected by it. Rising cost in form of higher wages and other inputs not supported by increase in price realization, continues to pose major threat on survivability or organized sector.

Current year outlook looks comfortable on crop front wherein deficit of last year which was more than 100 million kgs is likely to be erased this year. However, price realization could be under pressure due to excess production and unregulated import of tea from Nepal and Kenya. With rising cost & stagnant price realization, the organized sector is finding very difficult to survive. Our company is taking utmost precaution and leaving no stones unturned to pass through this turbulent phase faced by the industry.

The Companys financial position is strong enough which has helped company to pass through in turbulent times. The development and modernization work in garden is always given top priority for improvement in quantity as well as quality. The surplus fund in the Company is deployed in such a way that reasonable returns are derived.

In compliance with the requirement of the Listing

Regulations, the key financial ratios of the Company along with explanation for significant changes (i.e., for change of 25% or more as compared to the immediately previous financial year will be termed as ‘significant changes) has been provided hereunder:

The significant changes over previous year across all ratios is due to increase in profit as compared to last year and deduction in interest cost. For detailed explanation, please refer to Note no. 41 of the Notes to Standalone Financial Statements for the financial year ended March 31, 2025.

The Company has laid down policies, guidelines and procedures, which form part of its internal control system. The Companys internal control system is periodically tested and supplemented by an extensive programme of internal audit by independent firm of Chartered Accountants. Audits are finalized and conducted based on internal risk assessment. Significant findings are brought to the notice of the Audit Committee of the Board and corrective measures are recommended for implementation.

Industrial relations in all tea estates and units continued to be cordial. Focus on better deployment of labour in garden area has resulted in improving productivity both in quantitative and qualitative manner. The total number of people employed in your Company as on 31st March, 2025 was 3594.

ThestatementsinthereportoftheBoardofDirectorsandthe Managements Discussion and Analysis Report describing the Companys projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities Laws and Regulations. Actual results could differ materially from those expressed or implied since the Companys operations are influenced by many external and internal factors beyond the control of the Company.