Indong Tea Company Ltd Management Discussions

Annexure C

Industry Structure and Development

The Companys main business is growing, manufacture and sale of Tea. Tea is a seasonal industry. The Tea crop period ranges from March to December. The crop yield depends on the weather conditions. The area under plantation is constant and as such the yield depends to a large extent on irrigation facilities, better soil management techniques etc. Necessary steps are initiated by the Company for improving the yield and quality of crop in all its gardens. The Company is laying more stress on improving the quality and has commenced use of Vermi Compost in the plantation areas for sustaining the quality of soil as well as for improving the yield. The Company adopts good tea plantation practices to maintain the yield and has embarked on production of quality teas.

Opportunities and Threats

The Companys major income is from sale of tea. The tea manufactured by the Company is sold through auctions as well as private sales. The production cost of tea, comprises of various inputs which are statutorily required to be met by the Company including those under the Plantation Labour Act, Minimum Wages Act etc. and levies imposed by the Central and State authorities from time to time under various other laws.

The Company has completed augmentation of its tea manufacturing facilities located at Doors Region in the State of West Bengal.

The continuous promotional efforts and better marketing and brand building initiatives taken jointly by the Government/Tea Board including TRUSTEA programmes are likely to benefit the industry in the long term.

Unpredictable weather conditions and shortage of labour are the main threats to the industry.

Product/Segment wise Performance

The Companys main business is manufacturing of Tea which is sold through auction centres and as bulk/ private sales and is also covered under the sections "Financial Results" and "Review of Operations in the Directors Report. The gist of performance of the division during the financial year 2024-25 is as under:

Financial Year	Tea Crop (Green leaf) harvested and Purchased (In KG)	Black Tea Tea Produced (In KG)	Tea Sale (In KG)	Average Realization (Rs/Kgs)
2024-25	45,88,519	10,60,376	10,46,162	216.07
2023-24	53,70,352	12,40,109	12,25,824	172.71
Change (%)	14.56%	14.49%	14.66%	25.10%

Industrial Outlook

Tea is common man drink and is consumed widely throughout the country. The domestic production of tea is almost sufficient to meet the internal demands. The weather is of prime importance for the industry and due to the vagaries of the weather the production often fluctuates. The outlook for the tea industry is positive due to increasing domestic demand.

Risk and Concern

The Management has to constantly monitor the risks and concerns associated with the industry by ensuring adequate irrigation facilities to the Plantation areas, soil enrichment, protection of plantation against attacks by pests etc. and is also subject to changing market conditions and the trends.

Besides climatic conditions, global production, the rising growth of bought leaf sector, shortage of labour during peak season, increase in wages and other costs could affect the fortunes of the Tea Industry.

Internal Control System & their adequacy

The Companys internal control system is commensurate with its size and it ensures operational efficiency, accuracy in financial reporting and compliance of applicable laws and regulations. The system is reviewed from time to time.

Disclosures on financial performance with respect to operational performance

The disclosures under financial performance with respect to operational performance are covered by the respective sections i.e., "Financial Results" and "Review of Operations in the

Directors Report.

Material developments in Human Resources / Industrial Relations front including number of people employed

The Tea industry is labour intensive and provides employment to a very large segment of the local population. The company presently has one tea estates located in the State of West Bengal with a total granted area of about 740.38 hectares. The Company has provided fresh employment to about 39 employees including workers, staff and sub-staffs during the year. As on 31st March, 2025 the Company provided employment to about 1339 employees including workers, staff and sub-staffs.

Significant changes in key financial ratios and return on Net Worth a) Details of significant changes (i.e. change of 25% or more as compared to the immediately preceding previous financial year) in key financial ratios or sector specific ratios along with detailed explanations therefore

Ratio	Ratio FY			Reason for Variance
	31.03.25	31.03.24	% Variance
Debtors Ratio Turnover	7.56	61.60	87.73	Due to increase in the net credit sale resulting increase in debtors during the year.
Inventory Ratio Turnover	10.12	9.77	-3.56	Normal Variance
Interest Ratio Coverage	1.39	-0.48	387.78	Due to increase in rate of interest from Bank, depreciation, wages & raw material purchased during the year.
Current Ratio	1.76	0.47	275.39	Due to substantial increase in the Stock & Debtors & decrease in trade payable.
Debt-Equity Ratio	0.16	0.21	23.01	Normal Variance
Operating Profit Margin	0.04	-0.02	334.56	Due to increase in the net credit sale and due to increase in rate of Bank Interest, depreciation, wages & raw material
Net Profit Margin	0.00	-0.09	101.03	Due to increase in the net credit sale and due to increase in rate of Bank Interest, depreciation, wages & raw material

b) Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof.]

Ratio	Ratio FY			Reason for Variance
	31.03.24	31.03.23	% Variance
Return on Net Worth	0.00	-0.03	101.12	Due to increase in the net credit sale and due to increase in rate of Bank Interest, depreciation, wages & raw material

Disclosure of Accounting Treatment

The financial statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act.

Cautionary Statement

Statements in this management discussion and analysis describing the Companys objectives, projections, estimates and expectations may be forward looking statements within the meaning of applicable laws and regulations. Actual results may differ from those expressed or implied.

Important developments that could affect the Companys operations include a downtrend in the industry- global or domestic or both, significant changes in political and economic environment in India, applicable statues, litigations etc.

	For and on Behalf of the Board
Registered Office:
4/1, Middleton Street,	Sd/-
Sikkim Commerce House	Hariram Garg	Sd/-
5th Floor, Kolkata-700071	(DIN: 00216053)	Manoj Kumar Ganguly
Date: 1st September, 2025	Managing Director	Chief Financial Officer