Diana Tea Company Ltd Management Discussions

The total world tea production was 7267 million Kgs in 2025 as compared to 7087 million Kgs in 2024, out of which contribution from Indian tea crop was 1369 million Kgs when compared to 1303 million Kgs last year. Total Indian tea export was 280 million Kgs in 2025 against last year 256 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.

Segment Analysis

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.

Opportunities Threats, Risks and Concerns

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.

Outlook

The current outlook of Indian Tea production looks to be at par last year wherein the crop till the month of June is more or less at par with last year. Price gap between quality and non-quality tea is likely to be widened. Rising input cost along with higher wages is likely to put immense pressure on the organized tea sector. However with our higher yielding gardens and focus on producing good quality tea our company is confident of passing through this turbulent phase faced by the industry.

Financial Review and Analysis

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.

Details of Significant Changes in key financial ratios along with detailed explanations

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:

Annexure to the Directors Report

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, 2026.

Internal Control systems and their adequacy

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.

Material developments in human resource / industrial relations front, including number of people employed

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, 2026 was 3616.

Cautionary Statement

The statements in the report of the Board of Directors and the 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.