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Directors Report of Tata Consumer Products Ltd.

Mar 31, 2023

The Board of Directors is delighted to present the 60^th Annual Report on the business and operations of Tata Consumer Products Limited ("the Companyâ) along with the summary of standalone and consolidated financial statements for the year ended March 31, 2023.

In compliance with the applicable provisions of the Companies Act, 2013, ("the Actâ), the Securities and Exchange Board of India (âSEBIâ) (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulationsâ), this Boardâs Report is prepared based on the standalone financial statements of the Company for the year under review and also present the key highlights of performance of subsidiaries, joint ventures, and associate companies and their contribution to the overall performance of the Company during the year under review.

OVERVIEW OF FINANCIAL PERFORMANCE

Key highlights of consolidated and standalone financial performance for the year ended March 31, 2023, are summarised as under:

('' in Crores)
Particulars	Consolidated		Standalone
Particulars	FY 2023	FY 2022	FY 2023	FY 2022
Revenue from Operations	13,783	12,425	8,539	7,932
Profit before Exceptional Items and Taxes	1,634	1,508	1,306	1,178
Exceptional items (net)	159	(52)	(39)	(27)
Profit before Tax	1,794	1,456	1,267	1,151
Provision for Tax	(447)	(377)	(317)	(265)
Profit after Tax	1,347	1,079	950	886
Share of net profit/(loss) in Associates and Joint Ventures	(26)	(64)	-	-
Profit for the year	1,320	1,015	950	886
Attributable to:
- Owners of the parent	1,204	936 \|	950	886
Retained Earnings - Opening Balance	6,972	6,396	4,039	3,503
Add /(Less):
- Profit for the year	1,204	936 \|	950	886
- Other Comprehensive Income/(Expense)	(75)	31	14	23
- Dividend Paid	(558)	(373)	(558)	(373)
- Other items	(171)	(18)	3	-
Retained Earnings - Closing Balance	7,372	6,972	4,448	4,039

FINANCIAL HIGHLIGHTS

CONSOLIDATED PERFORMANCE

Consolidated revenue from operations for the year at '' 13,783 Crores grew by 11%. India Branded Business grew by 10%, led by volume and value growth in India Salt and continuation of the growth story in the Ready-to-Drink, Sampann and Soulfull portfolio fueled by increased distribution. The revenue from India Beverages was marginally lower due to stress in rural

demand for most of the year and the delayed onset of winter. International Business topline grew by 6%, in constant currency, driven by price increases taken across markets to offset inflationary headwinds and weakness in the currency. Non-Branded business grew by 21%, in constant currency, on account of favourable price realizations for coffee extraction and plantations business.

Profit before exceptional items and taxes at '' 1,634 Crores grew by 8%. Operating margins largely remained

in line with the previous year, despite commodities and currency facing significant inflationary trends for a major part of the year. India Branded Business delivered operating margins higher than previous year despite elevated commodity costs and inflationary pressures through price increases and good control over costs. International Business operating margins declined mainly due to inflationary pressure on commodities and distribution costs, weakness in currency and lag in pricing interventions. Non-Branded Business operating margins also improved over the previous year.

The Groupâs net profit at '' 1,320 Crores grew by 30% mainly on account of higher operating profit, higher exceptional income and improvement in the performance of Joint Venture and Associate companies. Tata Starbucks performance improved significantly driven by the opening of 71 new stores and improved in-store performance and offerings. Higher exceptional income is mainly on account of accounting gain on the conversion of Joint Ventures in South Africa and Bangladesh into subsidiaries and profit on the sale of investment property in Tata Coffee Limited partly offset by costs relating to restructuring and re-organization.

STANDALONE PERFORMANCE

Revenue from operations at '' 8,539 Crores grew by 8%. Revenue growth was mainly led by Salt and Sampann, whilst the Beverage business was marginally lower than the previous year. Salt business recorded volume and value growth. Sampann and Coffee portfolio recorded strong growth led by increased distribution, higher brand salience and improved performance in e-commerce and modern trade.

Profit before exceptional items and taxes at '' 1,306 Crores grew by 11% mainly led by revenue growth and higher operating profits, partly offset by lower dividend income in the current year from subsidiaries. Profit after tax at '' 950 Crores was higher by 7% post exceptional items on restructuring and re-organization and merger-related costs.

HIGHLIGHTS OF OPERATIONAL PERFORMANCE

The operational performance of the Company and its business units, key subsidiaries and joint ventures are detailed in the Management Discussion and Analysis forming part of the annual report.

DIVIDEND & RESERVES

DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy as adopted and formulated by the Board in terms of Regulation 43A of the Listing Regulations is provided as Annexure 1 attached to this report and is also available on the website of the Company at the link: https://www.tataconsumer.com/ investors/policies

declaration and payment of dividend

The Board is pleased to recommend a dividend of '' 8.45 per equity share of the Company of '' 1 each (845%) for the year ended March 31, 2023. The Board recommended dividends based on the parameters laid down in the Dividend Distribution Policy and the dividend will be paid out of the profits for the year.

The said dividend on equity shares is subject to the approval of the Shareholders at the ensuing Annual General Meeting (âAGMâ) scheduled to be held on June 6, 2023. If approved, the dividend would result in a cash outflow of '' 785.01 Crores. The total dividend payout works out to 82.63% (Previous Year: 62.95%) of the Companyâs standalone net profit.

The dividend once approved by the Shareholders will be paid on or from June 8, 2023, and before July 5, 2023.

book closure & record date

In order to determine the eligibility of shareholders to receive the dividend for the fiscal year ending on March 31, 2023, the Register of Members and Share Transfer Books of the Company will be closed from Saturday, May 20, 2023, to Friday, May 26, 2023 (both days inclusive).

According to the Finance Act, 2020, dividend income will be taxable in the hands of the Members w.e.f. April 1, 2020, and the Company is required to deduct tax at source from the dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961.

unclaimed dividends

Details of outstanding and unclaimed dividends previously declared and paid by the Company are given under the Corporate Governance Report.

transfer to reserve

As permitted under the Act, the Board does not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for FY 2022-23 in the profit and loss account.

CHANGE iN SHARE CAPiTAL

During the year under review, the Company had issued and allotted 74,59,935 equity shares of '' 1 each on October 21, 2022, to Tata Enterprises (Overseas) AG, Zug, Switzerland at a price of '' 765.16 per share (inclusive of premium) for a consideration discharged other than by cash i.e., swap of shares. As a result of such allotment, the issued, subscribed and paid-up share capital increased from '' 92,15,51,715 (comprising 92,15,51,715 equity shares of '' 1 each) to '' 92,90,11,650 (comprising 92,90,11,650 equity shares of '' 1 each). The equity shares so allotted rank pari-passu with the existing equity shares of the Company.

There was no change in the authorized share capital of the Company, which was '' 125,00,00,000 comprising of 125,00,00,000 equity shares of '' 1 each.

Except as mentioned above, the Company had not issued any other shares or instruments convertible into equity shares of the Company or with differential voting rights nor has granted any sweat equity.

PERFORMANCE SHARE UNITS

The Company has formulated Tata Consumer Products Limited Share-based Long Term Incentive Scheme 2021 ("TCPL SLTI Scheme 2021â or "the Schemeâ) to offer competitive compensation to attract and retain talent; and to redefine the fixed and performance pay mix to drive a performance culture in the Company at a senior management level. The Scheme is intended to reward, retain and motivate the Eligible Employees of the Company and its subsidiary companies as defined in the Scheme (hereinafter collectively referred to as âEligible Employeesâ) for their performance and participation in the growth and profitability of the Company. The said initiative to link the employeeâs performance in the Company along with other initiatives would contribute to improve the performance of the Company. The Scheme has been formulated in accordance with the provisions of the Companies Act, 2013 (âthe Actâ) and SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SBEB&SE Regulationsâ) and during the year under review, there was no change in the Scheme.

The Eligible Employees shall be granted Performance Share Units (PSUs), as determined by the Nomination and Remuneration Committee of the Board, which will vest on particular dates and could be exercisable into fully paid-up Equity Shares of '' 1/- (Rupee One Only) each of the Company, on the terms and conditions as provided under the Scheme, in accordance with the provisions of the applicable laws and regulations for the time being in force.

The Company has structured the Scheme for its Eligible Employees with major objectives viz. to drive long-term objectives of the Company; to attract, motivate and retain employees by rewarding them for their performance; ring fence and incentivize key talent to drive long-term objectives of the Company; to ensure that the senior management employeesâ compensation and benefits match the long gestation period of certain key initiatives; and to drive ownership behaviour and collaboration amongst employees.

Under the Scheme, the Company would grant upto 5,00,000 Performance Share Units (âPSUsâ) in one or more tranches to Eligible Employees that would entitle the Grantees to acquire, not exceeding 5,00,000 fully paid-up equity shares of '' 1/- (Rupee One Only) each. The number of PSUs to be granted to Eligible Employees is determined based on Long Term Incentive Pay amount to be awarded to Eligible Employees. The PSUs together with existing fixed pay and performance pay comprised the total compensation being offered to selected senior management employees of the Company and its subsidiary companies. The intent is to cover select senior leaders who can make a significant difference to the Companyâs performance to align their rewards directly to the Companyâs performance. The value of the award can be realized only on superior business performance leading to superior share price performance over a period of time.

During the year under review, the Company has granted 1,13,545 PSUs to eligible employees in terms of the TCPL SLTI Scheme 2021 and no employee was granted PSUs equal to or exceeding 1% of the issued share capital of the Company. The Vesting period for the PSU granted under the Scheme shall not be less than one year and all the PSUs would vest, based on the Companyâs performance, within a period of 3 years from the date of Grant of respective PSUs.

The statutory disclosures as mandated under the Act and SBEB&SE Regulation and a certificate from Secretarial Auditors, confirming implementation of the Scheme in accordance with SBEB&SE Regulations and shareholderâs resolution have been hosted on the website of the Company at https://www.tataconsumer. com/investors/investor-information/annual-reports and will be available for electronic inspection by the members during the AGM of the Company.

CHANGES iN THE NATURE OF BUSiNESS

During the year under review, there has been no change in the nature of the business of the Company.

MATERiAL CHANGES AND COMMiTMENTS AFFECTiNG THE FiNANCiAL POSiTiON

There have been no material changes or commitments that have affected the financial position of the Company between the close of FY 2022-23 and the date of this report.

UPDATE ON CORPORATE RESTRUCTURiNG

COMBINING TATA COFFEE''S BUSINESS INTO THE COMPANY AND iTS WHOLLY-OWNED SUBSiDiARY THROUGH A COMPOSiTE SCHEME OF DEMERGER AND MERGER

During the year under review, the Composite Scheme of Arrangement amongst the Company, Tata Coffee Limited (âTCLâ), and TCPL Beverages & Foods Limited (âTBFLâ) for the Demerger of the Plantation Business of TCL into TBFL and the Amalgamation of remaining business of TCL with the Company (âthe Schemeâ) had been approved by the shareholders of the Company on November 12, 2022, and by the shareholders of TCL on February 3, 2023, by the requisite majority of all members voted on the respective resolution as well as by a majority of the public shareholders voted on the respective resolution.

The Scheme is subject to inter-alia receipt of the approval of the Regional Director, MCA and the Registrar of Companies, National Company Law Tribunals (benches at Kolkata and Bengaluru) and other regulatory authorities, as may be applicable.

The Scheme and other documents are hosted on the website of the Company, which can be accessed at the link - https://www.tataconsumer.com/investors/scheme-of-amalgamation/tc-tcplb-with-tcpl.

PURCHASE OF Non-Controlling iNTERESTS iN TATA CONSUMER PRODUCTS UK THROUGH A PREFERENTiAL iSSUE OF Equity SHARES

During the year under review, upon receipt of relevant approval from Reserve Bank of India on October 7, 2022, in terms of Foreign Exchange Management (NonDebt Instruments) Rules, 2019 and confirmation from

Standard Chartered Bank, Authorised Dealer on October 17, 2022, basis the communication issued to them by Reserve Bank of India on October 14, 2022 under Foreign Exchange Management (Overseas Investment) Rules, 2022, the Preferential Issue Committee of the Board of the Company, has allotted 74,59,935 equity shares of the Company having a face value of '' 1 each, at a price of '' 765.16 per equity share on a preferential basis to Tata Enterprises (Overseas) AG, Zug, Switzerland (âTEOâ) for a total consideration of '' 570.80 Crores on October 21, 2022, discharged by TEO by transfer of 2,38,71,793 ordinary shares of Â£1 each held by TEO, representing 10.15% of the paid-up share capital of Tata Consumer Products UK Group Limited, United Kingdom, an existing overseas subsidiary of the Company (âTCP UKâ) in favour of the Company.

With the completion of the said transaction, Tata Consumer Products UK Group Limited and all its subsidiaries became wholly-owned subsidiaries of the Company with effect from October 21, 2022.

strategic initiatives

The business continued to strengthen its foundations as a Focused Consumer Products Company. During the current year, significant progress was made on the six strategic pillars identified by the Group.

STRENGTHEN AND ACCELERATE CORE BUSiNESS

The Company continued to focus on the core business and innovations to drive growth through higher investment behind brands, increased assortment, increased distribution reach and digitisation. The Company, during the year, has made significant progress and reached direct 1.5 Million outlets. Further, with an increased portfolio, the Company has implemented split routes to drive assortment, increase the depth and focus on growth drivers in all 10 lacs plus towns. To improve execution in semi-urban areas, the Company focused on the conversion of a large number of sub-distributors to direct distributors. Significant progress was made in sales through alternate channels with modern trade growing significantly and the Company further strengthened its position in the e-commerce channel. Packaged Beverages continued to focus on growing premium brands. In Salt, apart from strengthening the base Tata Salt, we continue to look at expanding our value-added range and driving premiumisation.

DRIVE DIGITAL AND INNOVATION

The Company continues to focus on driving digital in every part of the business to stay in tune with technological advancements and drive efficiencies across the value chain. During the year, it integrated mostly all group companies into SAP S/4 HANA framework. The Company, in order to support the sales transformation, implemented a self-service enabled sales order portal for general trade sales channels. The Distributor Management Software (DMS) was consolidated for both Beverages and Foods portfolios and was also extended to Ready-to-Drink business. Further to drive growth, it increased focus on Revenue growth management initiatives. The Company used digital technologies to enable efficiencies in operations and had also implemented the Integrated Business Planning solution for India Business, a CRM Platform for customer service, warehouse management for Bin and Picklist and Advanced Blend optimizer for tea using Machine Learning Solutions.

Innovation is a strong strategic pillar as the Company focused on understanding and pre-empting evolving consumer trends and developing high-quality and differentiated products to delight increasingly discerning consumers. It leveraged technology to drive cost reduction/ optimization. During the year, the Company has invested behind infrastructure, now having three centers of excellence, as well as team capabilities and increased the contribution of innovation to overall revenue.

EXPLORE NEW OPPORTUNITIES

The Company aspires to be a leading player in the FMCG industry, by expanding its play in existing categories and venturing into new spaces. It evaluates both organic and inorganic routes to capitalize on industry trends and tap into new consumers or markets. This includes piloting launches into new categories by leveraging a differentiated offering and a âright-to-winâ strategy and realigning capital investments to markets or businesses that have higher growth potential and the ability to generate sustainable returns.

During the year, the Company ventured into the protein and plant-based meat category in India with the launch of "Tata Go-Fitâ and "Tata Simply Betterâ brands. Tata GoFit plant protein powder is a plant-based easy-to-mix product formulated with the goodness of gut-friendly probiotics, essential amino acids and digestion-friendly enzymes. Tata Go Fit brand is aimed at helping women along on their fitness journey. Tata Simply Better has four delicious plant-based meat variants. The product

range is rich in protein, trans-fat free, and has no added preservatives. The Company also ventured into the Ready-to-Eat/Ready-to-cook segment with our new brand âRaasaâ in the International markets.

UNLOCK SYNERGIES

The focus to unlock synergies and improve efficiency continued. Operations were further streamlined in India and International markets to drive operational efficiency. Integration of Teapigs UK and US into the main UK and US operations respectively which would help in achieving higher efficiency. Further, the Group has acquired a controlling stake in Joekels by increasing its shareholding to 75% with a further option to buy the balance 25% at a future date and also acquired a 100% stake in Bangladesh JV. The aforementioned two acquisitions would help the company in increasing its footprint in the global space and tap into growing International markets. Further during the year, the Company transferred and consolidated all back-end finance operations of India, US, UK and Canada under a shared service center in India "Pivot platformâ to have an efficient structure and optimisation of costs.

During the year under review, the Company completed the acquisition of an additional stake of 10.15% in Tata Consumer Products UK Group Limited, resultantly the entity and all its subsidiaries became wholly-owned subsidiaries of the Company with effect from October 21, 2022, by way of preferential issue of equity shares of the Company to Tata Enterprises (Overseas) AG, Switzerland.

Further, the merger/demerger of Tata Coffee with the Company was approved by the shareholders of the Company and Tata Coffee and expect the same to be effected by the first half of the financial year 2023-24. Post the same, the Company would look at the next stage of reorganization of the non-branded business to explore additional synergies.

CREATE FUTURE-READY ORGANISATION

The Company is committed to building a culture that empowers our people to realise the shared vision. It also ensures that our people have the opportunity to drive greater impact through meaningful and productive careers - this year, around 31% of all our open position globally were filled internally. On April 19, 2022, the Womenâs Inclusion Network platform was launched for women colleagues to help them connect, learn and grow.

EMBED SUSTAINABILITY

As part of the Tata Group, the ethos of responsibility and sustainability are interwoven in the corporate and work philosophy. The Company is committed to a sustainable way of doing business and for more details refer to Management Discussion and Analysis Report. Further, the Business Responsibility and Sustainability Report (âBRSRâ) covering disclosures on Companyâs performance on ESG (Environment, Social and Governance) parameters for FY 2022-23, forms an integral part of the Integrated Annual Report. BRSR includes details on performance against the nine principles of the National Guidelines on Responsible Business Conduct.

SUBSIDIARIES, JOINT VENTURES, AND ASSOCIATE COMPANIES

As defined under the Act, the Company has 43 subsidiaries, 2 joint ventures, and 2 associate companies as of March 31, 2023.

COMPANIES THAT HAVE BECOME OR CEASED TO BE SUBSIDIARIES, JOINT VENTURES, AND ASSOCIATES Conversion of Tetley ACI (Bangladesh) Limited from a joint venture to a wholly-owned subsidiary company

During the year under review, Tata Consumer Products Overseas Holdings Limited, (âTCP Overseasâ), a step-down wholly-owned subsidiary of the Company, which held 50% share capital of Tetley ACI (Bangladesh) Limited, Bangladesh (âTetley ACIâ), together with Tata Consumer Products UK Group Limited (âTCP UKâ) has purchased remaining 50% share capital of Tetley ACI from the Joint-Venture partner - Advanced Chemical Industries Limited (âACIâ). As a result of the acquisition, the Joint Venture Agreement between ACI and TCP Overseas stand terminated, and Tetley ACI became a wholly-owned subsidiary of TCP UK and a step-down wholly-owned subsidiary of the Company with effect from February 9, 2023.

Increase in stake in Joekels Tea Packers (Proprietary) Limited

During the year under review, TCP Overseas, a step-down wholly owned subsidiary of the Company through TCP UK (direct WOS), had purchased 23.3% of the share capital of Joekels Tea Packers (Proprietary) Limited, Republic of South Africa (âJoekelsâ), from its Joint-Venture partners. As a result of such acquisition, the holding of TCP Overseas in Joekels increased from 51.7% to 75% of

the equity share capital and the remaining 25% was held by the joint venture partners.

MATERIAL SUBSIDIARIES

The Company has 3 unlisted material subsidiaries incorporated outside India i.e. Tata Consumer Products GB Limited, Tata Consumer Products UK Group Limited, and the Eight Oâclock Coffee Company Limited.

The Policy for determining Material Subsidiaries as formulated in line with the requirements of the Act and the Listing Regulations, and the same can be accessed on the Companyâs website at https://www.tataconsumer. com/investors/policies.

consolidated financial statements

According to Section 129(3) of the Act, the consolidated financial statements of the Company and its subsidiaries, joint ventures, and associates are prepared in accordance with the relevant Indian Accounting Standard specified under the Act, and the rules thereunder and form part of this Annual Report. A statement containing the salient features of the financial statements of the Companyâs subsidiaries, joint ventures, and associates in Form No. AOC-1 is given in this Annual Report.

Further, pursuant to the provisions of Section 136 of the Act, the financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company, at the link: https:// www.tataconsumer.com/investors/investor-relations/ subsidiaries/subsidiary-financials.

The details of the business of key operating subsidiaries, associates, and joint ventures during FY 2022-23 are given in the Management Discussion and Analysis Report, which forms part of this Annual Report.

PERFORMANCE HIGHLIGHTS OF Key Operating SUBSIDIARIES, ASSOCIATES AND JOINT vENTURES

SUBSIDIARIES

Tata Consumer Products UK Group Ltd, UK (âTCP UKâ)

TCP UK reflects the financial performance of International Tea Business. The major brands are Tetley, Good Earth and Teapigs. Revenue at '' 2,089 Crores, grew by 3% in constant currency. Revenue growth was mainly driven by price increases taken to offset inflationary pressures. Operating margins were lower mainly due to significant

margins in the earlier part of the year, saw improvement in the latter part of the year both due to price increases becoming effective and also due to implementation of cost restructuring initiatives.

Eight O''clock Coffee Company, USA (âEOCâ):

Revenue from Operations at '' 1,489 Crores, grew by 7% in constant currency. Revenue growth was mainly on account of price increases taken to mitigate inflation on the cost of greens. Operating margins were lower mainly driven by inflationary headwinds in commodity and distribution costs. Profit after tax at '' 117 Crores was lower by 32%. The Company ran a new digital campaign-"Over delivery in every cupâ for the core Eight OâClock coffee brand and video creatives for Barista blends -"Be Your Own Baristaâ proposition to drive awareness. Innovation focus was maintained with range extensions in Flavors of America and Barista Blends.

Nourishco Beverages Limited, india (âNourishcoâ):

Revenue from Operations at '' 621 Crores grew by 80% over the previous year, driven by strong brand performance and higher distribution reach. All three flagship brands - Tata Gluco Plus, Tata Copper Plus, and Himalayan registered strong growth. Tata Gluco Plus grew by 53%, the growth was mainly led by increased distribution reach in existing territories and expansion into new geographies within India along with support through a TV campaign. Tata Gluco Plus innovations, Juice and Jelly Shake received encouraging responses from the customers. Tata Copper Plus continued its growth momentum with increased distribution in existing and new markets and contributed significantly to the overall revenue of the Company. Himalayan grew by 85% driven by increased distribution, activation of institutional accounts and leveraging digital mediums and e-commerce channels, also forayed into the Honey and Preserve category with new launches.

Tata coffee limited, india (âTcLâ):

Revenue from Operations at '' 1,023 Crores grew by 25% against the prior year. Revenue growth was driven by higher revenues from coffee extractions and coffee plantations partly offset by underperformance in tea plantations. Coffee extraction business experienced a challenging demand scenario, especially in Africa, which was mitigated through the acquisition of new customers and adding new geographies to the portfolio. Coffee plantation business witnessed a sharp increase in coffee prices during the early part of the year which aided the topline, however was impacted by lower crops. Tea plantations were impacted by lower volumes on account of adverse weather conditions and lower price realisation. The operational profit improved both for

inflationary headwinds on input, distribution costs, currency weakness and lag in price intervention. Profit after tax at '' 220 Crores reflected a growth of 54% mainly driven by higher exceptional income on account of accounting gain on the conversion of Joint Ventures in South Africa and Bangladesh into the subsidiaries.

In the UK, revenue remain largely in line with previous year in constant currency. Price increases were taken in the current year, however it witnessed a volume decline on account of category softness. The decline was mainly in the black tea segment in mainstream grocery due to the high inflation environment which also fueled significant growth in private labels and discounters. However, Teapigs and Good Earth revenues continued the growth momentum. Teapigs Kombucha was launched this year, following the launch of Good Earth Kombucha range in the previous year. Leveraging the health & wellness platform - Tetley Supers, Specialty and Herbals ranges performed well. Tetley Herbals is now ~1% share of the total F&H segment. Good Earth Kombucha and Good Energy (natural energy drink) launches have shown encouraging results. During the year, the UK business went through restructuring with Teapigs business being integrated and the sales operations restructured to be in line with the overall International three brand strategy. Operating margins marginally declined on account of inflationary headwinds on inputs and distribution costs, currency weakness and lag in price intervention. Investment behind brands continued with a new campaign on âTetleyâ on National TV and social media and Teapigs and Good Earth ran social media campaigns to improve the saliency of the brands.

In Canada, we continue to hold the leading position in the Tea market. For the current year, revenue grew by 9% in constant currency led by price increases and volume growth despite category softness. Tetley emerged as "Most Trusted Tea Brand 2022â - Readerâs Digest, for the 9^th consecutive year reinforcing our position in the consumerâs mind, more so after the pandemic. Operating margins were lower on account of inflationary headwinds on input and distribution costs which were partly offset by price increases taken during the year. Investment behind the brand continued with the new campaign âLive Teaâ and significant steps were taken to increase the digital footprint of Tetley.

Other smaller markets had similar performances. Australia, Poland and Western Europe revenue grew mainly led by price increases. All markets were impacted on account of inflationary headwinds present on commodities/distribution costs on account of supply-side issues and currency weakness. Price interventions were taken to improve the operating margins, however, at a lag, which had a negative impact on the operating coffee extraction and coffee plantations on account of increased realisation which was partly offset by input cost inflation and higher wage costs in tea plantations. Profit after tax at '' 231 Crores, grew by 127% mainly on account of improved profitability margins and exceptional income on the sale of investment property.

Tata Coffee Vietnam Company Limited, Vietnam (âTCVâ):

Revenue from Operations at '' 343 Crores, grew by 23% in constant currency. TCV recorded a Profit after tax of '' 14 Crores, which grew by 163%. Revenue growth was led by both higher volume and realization and also on account of faster go-to-market strategy. Profitability improvement was mainly led by revenue growth and efficient management of significant inflationary pressure on costs.

ASSOCIATES

Amalgamated Plantations Private limited, india (âAPPLâ):

Revenue from Operations at '' 967 Crores, grew by 13% mainly led by improvement in price realization of own crop led by quality improvement and higher volumes. Despite this, performance was adversely impacted by the increase in wage cost both in Assam and West Bengal and other cost inflation.

Kanan Devan Hills Plantations Company Private Limited, india (âKDHPâ):

Revenue from Operations at '' 454 Crores, grew by 15% mainly led by higher price realization and increase in volumes. Profit after tax was largely in line with the previous year. Improvements on account of higher revenue offset by higher costs and increased wages in South India.

joint venture

Tata starbucks Private limited, india (âTsPLâ):

Revenue from Operations at '' 1,087 Crores grew by 71% driven by improved performance of existing stores and the opening of new stores. TSPL extended its reach to 15 new cities and added 71 new stores during the year. Revenue growth was led by the increase in average daily transactions, higher footfalls, upgraded food & beverages and smaller size offerings introduced in select stores. During the year, the Company celebrated its 10^th year anniversary in India and opened its first ever âReserve Storeâ in Fort, Mumbai. The store offers the mocha aficionados, an intimate and incomparable multisensory experience and will provide customers with a place to unwind and connect over the storeâs signature handcrafted beverages with a selection of freshly baked treats.

For further analysis on the consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financials and Form No. AOC 1

board of directors

During the year under review, the composition of the Board has been expanded from 8 Directors to 9 Directors by the induction of Mr. David Crean as an Independent Director. As on the date of the report, the Board comprises, 5 Independent, 2 Non-Executive and 2 Executive Directors, details thereof have been provided in the Corporate Governance Report.

In terms of the requirement of the Listing Regulations, the Board has identified core skills, expertise, and competencies of the Directors in the context of the Companyâs businesses for effective functioning. The list of key skills, expertise and core competencies of the Board of Directors is detailed in the Corporate Governance Report.

In the opinion of the Board, all the directors, as well as the directors appointed / re-appointed during the year possess the requisite qualifications, experience and expertise and hold high standards of integrity.

Criteria for determining qualification, positive attributes and independence of a director is given under the NRC Policy, which can be accessed at the link - https://www. tataconsumer.com/investors/policies

appointment/re-appointment of directors made during FY 2022-23

Based on the recommendation of the Nomination and Remuneration Committee (âNRCâ), the Board approved the appointment/re-appointment of the following Directors, during FY 2022-23 and such appointment/ re-appointment were also approved by the Members at the 59^th Annual General Meeting held on June 27, 2022 (â59^th AGMâ):

1. Mr. David Crean (DIN 09584874), who was appointed by the Board as an Additional Director under the category of Non-Executive, Independent Director with effect from May 4, 2022, was appointed as a Non- Executive Director of the Company at the

Mr. L. Krishnakumar as a Whole-time Director designated as "Executive Director and Group Chief Financial Officerâ of the Company for a further period of 7 months effective April 1, 2023 upto October 31, 2023, subject to the approval of the Members.

The profile and particulars of experience, attributes and skills of Mr. L. Krishnakumar together with his other directorships and committee memberships have been disclosed in the annexure to the Notice of the Annual General Meeting.

PECUNIARY RELATIONSHIP OR TRANSACTIONS WITH THE COMPANY

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 for the purpose of attending meetings of the Board/ Committee(s) of the Company.

INDEPENDENT DIRECTORS

Mr. Bharat Puri, Ms. Shikha Sharma, Mr. Siraj Chaudhry, Dr. K. P. Krishnan, and Mr. David Crean are Independent Directors on the Board.

All the Independent Directors of the Company have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the Listing Regulations and they continue to comply with the Code of Conduct laid down under Schedule IV of the Act. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation that exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. The Directors have further confirmed that they are not debarred from holding the office of the director under any SEBI order or any other such authority.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied with the integrity, expertise, and experience (including proficiency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. Further, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, Independent Directors of the Company have included their names in the data bank of Independent Directors.

59^th AGM. The Members also approved the appointment of Mr. David Crean as an Independent Director of the Company for a term of five years commencing from May 4, 2022 upto May 3, 2027.

2. Mr. Siraj Chaudhry (DIN 00161853), Independent Director of the Company whose first term of 5 years expired on July 2, 2022, was re-appointed for the second term of five years commencing from July 3, 2022 upto July 2, 2027.

3. Mr. P. B. Balaji (DIN 02762983), Non-Executive (Non-Independent) Director of the Company, who retired by rotation in terms of Section 152(6) of the Companies Act, 2013 was re-appointed.

The Board affirms that Mr. David Crean and Mr. Siraj Chaudhry meet the criteria of independence as provided in Section 149(6) of the Act, including rules framed thereunder, as well as Regulation 16(1)(b) of the Listing Regulations.

RE-APPOINTMENT OF DIRECTORS RETIRING BY ROTATION

In terms of the provisions of the Companies Act, 2013, Mr. N. Chandrasekaran (DIN 00121863) Non-Executive (Non-Independent) Director of the Company, retires at the ensuing AGM and being eligible, seeks reappointment. A resolution seeking the re-appointment of Mr. N. Chandrasekaran forms part of the Notice convening the ensuing Annual General Meeting scheduled to be held on June 6, 2023.

The profile and particulars of experience, attributes and skills of Mr. N. Chandrasekaran together with his other directorships and committee memberships have been disclosed in the annexure to the Notice of the Annual General Meeting.

RE-APPOINTMENT OF EXECUTIVE DIRECTOR

Mr. L. Krishnakumar (DIN 00423616) was appointed as Whole-time Director and designated as "Executive Director and Group Chief Financial Officerâ effective April 1, 2013 till March 31, 2018. He was then re-appointed as Executive Director and Group Chief Financial Officer for a further period of five years from April 1, 2018, till March 31, 2023. Mr. L. Krishnakumarâs term as Executive Director and Group CFO was ended on March 31, 2023, and as per the Governance Guideline on Board Effectiveness for the Tata Group Companies, the retirement age for Managing/Executive Directors is 65 years. Accordingly, he is eligible for re-appointment upto the attainment of the age of 65 years. Based on performance evaluation and the recommendation of the NRC, the Board, at its meeting held on March 29, 2023, re-appointed

Unless exempted, Mr. David Crean will be required to pass the proficiency test within the permissible time limit.

BOARD MEETiNGS

The Board meets at regular intervals to discuss and decide on the Company/business policy and strategy apart from other Board business. The Board exhibits strong operational oversight with regular presentations in quarterly meetings. The Board/Committee meetings are pre-scheduled, and a tentative annual calendar of the Board and Committee meetings is circulated to the Directors well in advance to help them plan their schedule and ensure meaningful participation in the meetings. Only in case of special and urgent business, if the need arises, the Boardâs or Committeeâs approval is taken by passing resolutions through circulation or by calling the Board / Committee meetings at a shorter notice, as permitted by law.

The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed to enable the Directors to make an informed decision.

The Board of Directors held 5 (five) meetings during FY 2022-23, details thereof have been provided in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Act and the Listing Regulations.

KEY MANAGERIAL PERSONNEL

As on the date of this report, the following are Key Managerial Personnel (âKMPsâ) of the Company as per Sections 2(51) and 203 of the Act:

a) Sunil DâSouza, Managing Director & CEO,

b) L. Krishnakumar, Executive Director & Group CFO,

c) Sivakumar Sivasankaran, Chief Financial Officer, India and

d) Neelabja Chakrabarty, Company Secretary.

Mr. John Jacob retired as Chief Financial Officer, India and Key Managerial Personal of the Company w.e.f. close of business hours on May 31, 2022, on attaining the age of superannuation. The Board placed on record its sincere appreciation for the contribution made by him over the years.

Consequent to the above retirement and based on the recommendation of the NRC and approval of the Audit Committee, the Board of Directors of the Company, had appointed Mr. Sivakumar Sivasankaran as Chief Financial Officer, India and as Key Managerial Personnel of the Company effective June 1, 2022.

COMMITTEES OF THE BOARD

As required under the Act, and the Listing Regulations, the Company has constituted the following statutory committees:

â¢ Audit Committee

â¢ Nomination and Remuneration Committee

â¢ Stakeholders Relationship Committee

â¢ Risk Management Committee

â¢ Corporate Social Responsibility & Sustainability Committee

In addition to the above, the Board has formed an Executive Committee to review specific business operational matters and other items that the Board may decide to delegate.

Details of all the Committees such as terms of reference, composition, and meetings held during the year under review are disclosed in the Corporate Governance Report, a part of this Annual Report.

The Board, from time to time, based on necessity, has delegated certain operational power to committees of directors formed for specific purposes like disinvestment of non-strategic investment, matters relating to the Scheme of Arrangement, Preferential issue of shares, etc.

AUDIT COMMITTEE

A qualified and independent Audit Committee has been set up by the Board in compliance with the requirements of Regulation 18 of the Listing Regulations and Section 177 of the Act. As on March 31, 2023, the Committee comprises of the Independent Directors -Dr. K. P. Krishnan (Chairman), Mr. Bharat Puri, Ms. Shikha Sharma, and Mr. Siraj Chaudhry. The Committee met 8 (eight) times during the year under review, the details of which are given in the Corporate Governance Report. Mr. David Crean, Independent Director was inducted as a member of the Audit Committee effective April 1, 2023.

The Audit Committee has adopted a Charter for its functioning. The primary objective of the Committee is to monitor and provide effective supervision of the Managementâs financial reporting process, to ensure accurate and timely disclosures, with the highest levels of transparency, integrity, and quality of financial reporting.

During the year under review, the Board accepted all recommendations made by the Audit Committee.

BOARD GOVERNANCE

The Nomination and Remuneration Committee (âNRCâ) of the Board is entrusted with the responsibility for developing competency requirements for the Board, based on the industry and strategy of the Company. The Board composition analysis reflects an in-depth understanding of the Company, including its strategies, environment, operations, financial condition, and compliance requirements.

NOMiNATiON & APPOiNTMENT OF DiRECTOR, KEY MANAGERiAL PERSONNEL AND SENiOR MANAGEMENT

Pursuant to the provisions of Section 178 of the Act and Regulation 19 of the Listing Regulations, NRC has formulated, and the Board has adopted a Policy on the appointment and removal of Directors including the Board Diversity Policy (âNRC Policyâ). NRC Policy is hosted on the website of the Company at: www.tataconsumer.com/ investors/policies. NRC has also formulated the criteria for determining qualifications, positive attributes, and independence of Directors, which has been embedded in NRC Policy.

NRC makes recommendations to the Board regarding the appointment/re-appointment of Directors, Key Managerial Personnel (âKMPsâ) and other members of the Senior Management. The role of the NRC encompasses conducting a gap analysis to refresh the Board periodically, including each time a directorâs appointment or re-appointment is required.

NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertaking reference, and due diligence, and meeting potential candidates before making recommendations of their nomination to the Board. The appointee is also briefed about the specific requirements for the position including expert knowledge expected at the time of appointment.

The Companyâs governance guidelines cover aspects mainly relating to the composition and role of the Board, Chairman and Directors, Board diversity, and Committees of the Board. As per the Companyâs policy on the retirement of directors, the retirement age for Managing/ Executive Directors is 65 years, NonExecutive (Non- Independent) Directors is 70 years, and Non-Executive, Independent Directors is 75 years.

BOARD DiVERSiTY

The Company recognizes and embraces the importance of a diverse board in its success. The Company believes

that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race, and gender, which will help the Company to retain its competitive advantage. The Board has adopted the Board Diversity Policy, as a part of NRC Policy which sets out the approach to the diversity of the Board of Directors. The said Policy is hosted on the website of the Company at: www.tataconsumer.com/investors/policies.

REMuNERATiON OF ExEcuTivE DIRECTORs, Key

MANAGERiAL PERSONNEL AND SENiOR MANAGEMENT

Pursuant to the provisions of Section 178 of the Act and Regulation 19 of Listing Regulations, NRC has also formulated a policy relating to the remuneration for the Directors, KMP, Senior Management and other employees, which is hosted on the website of the Company at: www. tataconsumer.com/investors/policies. The philosophy for remuneration is based on the commitment to fostering a culture of leadership with trust.

In accordance with the policy, the Managing Director, Executive Director, KMPs, Senior Management and employees are paid a fixed salary which includes basic salary, allowances, perquisites and other benefits and also annual incentive remuneration / performance-linked incentive/share-based employee benefit/performance-based shares/units, subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the NRC and the Board. The performance-linked incentive is driven by the outcome of the performance appraisal process and the performance of the Company and may be paid in the form of a cash component (Short-Term Incentive) and long-term performance shares units (Long-Term Incentive).

remuneration for independent directors and non-independent, non-executive directors

The Non-Executive Directors, including Independent Directors, are paid sitting fees for attending the meetings of the Board and Committees of the Board. As per the policy, the overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, the complexity of the business and the Companyâs capacity to pay the remuneration.

The Company pays a sitting fee of '' 30,000 per meeting per Director for attending meetings of the Board, Audit, Nomination and Remuneration and Executive Committees. For meetings of all other Committees of the Board, a sitting fee of '' 20,000 per meeting per Director is paid.

Within the ceiling as prescribed under the Act, the NonExecutive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and approved by the Board. The basis of determining the specific amount of commission payable to a Non-Executive Director is related to his attendance at meetings, role and responsibility as Chairman or member of the Board / Committees and overall contribution as well as time spent on operational matters other than at the meetings. The shareholders of the Company had approved payment of commission to the Non-Executive Directors at the Fifty-Fifth Annual General Meeting held on July 5, 2018, for each financial year to be distributed among the Directors in such manner as the Board of Directors may, from time to time, determine within the overall maximum limit of 1% (one percent) per annum or such other percentage as may be specified by the Act, from time to time. No Stock option has been granted to any Non-Executive Director.

As a policy, Mr. N. Chandrasekaran, Chairman, has abstained from receiving a commission from the Company. Further, in line with the internal guidelines of the Company, no payment is made towards commission to Mr. P.B. Balaji, Non-Executive Director of the Company, who is in employment with another Tata Company.

BOARD EVALUATION PROCESS

The Board of Directors carried out an annual evaluation of its own performance, Board Committees, and Individual Directors in accordance with the Act, Listing Regulations, and Governance Guidelines. The Nomination and Remuneration Committee led an internal evaluation process to assess the performance of the Board, its committees, and individual directors.

The performance of Individual Directors was reviewed by the Board and the NRC, with criteria such as preparedness, constructive contributions, and input in meetings. Non-Independent Directors, the Board as a whole, and the Chairman of the Company were evaluated at a separate meeting of Independent Directors, with input from Executive and Non-Executive Directors. The evaluation results were discussed at the Board meeting, where an action plan was agreed upon. The Company

also acted on feedback received from the previous yearâs evaluation process. For more details on the Board Evaluation Process, please refer the "Board Evaluationâ section of the Corporate Governance Report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has comprehensive internal control mechanism and also has in place adequate policies and procedures for the governance of orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention, and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures. The Companyâs internal control systems are commensurate with the nature of its business, and the size and complexity of its operations and such internal financial controls concerning the Financial Statements are adequate.

The Company has a strong and independent in-house Internal Audit ("IAâ) department that functionally reports to the Chairman of the Audit Committee, thereby maintaining its objectivity. The remediation of deficiencies as identified by the IA department has resulted in a robust framework for internal controls and details of which are provided in the Management Discussion and Analysis Report. Further, Statutory Auditors in its report expressed an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls.

ENTERPRISE RISK MANAGEMENT FRAMEWORK

The Company has an elaborate Enterprise Risk Management Policy and Risk Charter defining the risk management governance model, risk assessment, and prioritization process. Risk Management Framework of the Company integrates leading risk management standards and practices. In developing the Risk Management Framework, the focus has been to design

a process that addresses the Companyâs business needs while remaining simple and pragmatic. Risk Management Framework of the Company outlines the series of activities that the Company would use in identifying, assessing, and managing its risks.

The Risk Management Framework of the Company consists of two key components:

â¢ Risk management process: the steps and activities that Company would employ to identify, prioritize, and manage risks; and

â¢ Risk management structure: the enablers that facilitate the implementation of the process

The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an update to the Board on the Companyâs risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls.

Additionally, a third-party organization has benchmarked the Companyâs risk management practice with various companies in India and globally and pronounced it as a leader in the FMCG category. The Company was consecutively for the third time declared as the winner in the category in "Master of Risk in FMCG categoryâ, at the eighth edition of The India Risk Management Awards 2022 by CNBC TV-18 and ICICI Lombard. These awards recognize those organizations and teams that have significantly added to the understanding and practice of risk management.

CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY

The Company is a strong believer in the Tata Group philosophy of giving back to the community and acknowledging the role played by communities in the growth of our business. The Company stand âFor Better Livingâ which embeds actions towards For Better Communities, For Better Nutrition, For Better Sourcing, and For Better Planet. The Company is targeting to improve the lives of 1 million community members by 2023.

CSR activities, projects, and programs undertaken by the Company are in accordance with Section 135 of the Act and the rules made thereunder. Such CSR activities exclude activities undertaken in pursuance of its normal course of business. During the year under review, the CSR initiatives of the Company focused on women

empowerment, affordable health care, empowerment of differently abled, WaSH (Water, Sanitation and Hygiene), Rural Development and Education and Skilling. Such CSR projects undertaken by the Company contribute to Sustainable Development Goals (SDGs)

Under Section 135 of the Act, the Company was required to spend '' 16.59 Crores (2%) of the average qualifying net profits of the last three financial years on CSR activities on projects in FY 2022-23. During the year under review, the Company has spent '' 15.72 Crores on CSR activities, '' 0.45 Crores towards Administrative Overheads and '' 0.07 Crores towards Impact

Assessment, which is permissible under CSR Rules. Thereby spending '' 16.24 Crores on CSR activities and setting off '' 0.35 Crore from the excess amount spent in FY 20-21 and FY 21-22 towards the total CSR obligation for FY 2022-23, the Company has fulfilled its obligation of spending '' 16.59 Crores (2% of the average net profit as per section 135(5) for FY 2022-23. The Board of Directors has approved the same. In addition to the projects specified as CSR activities under section 135 of the Act, the Company has also carried out several other sustainability/responsible business initiatives and projects on a global scale.

Sustainability remains a core priority for the Company. In pursuit of this objective, the Company have been actively investing in solar energy to fulfil its energy requirements. Additionally, the Company have taken concerted measures to promote energy conservation, enhance health and safety conditions, and improve other related aspects in its operations. As part of climate adaptation efforts, the Company has conducted a comprehensive evaluation of its carbon footprint across Scope 1, 2, and 3, which was independently verified by the British Standard Institution [BSI]. As a founding member of the Trustea Sustainability code and verification system, the Company have supported its activities. In line with the Companyâs Sustainable sourcing program, the Company has obtained 55% of its tea from Trustea certified producers in India. In FY 2022-23, the Company has spent over Rs. 8 Crores towards advancing its sustainability endeavours.

The Annual Report on CSR containing particulars as prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are provided in Annexure 2 attached to this Report.

The CSR Policy may be accessed on the Companyâs website at the link: www.tataconsumer.com/investors/ policies.

Pursuant to Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 the Company has undertaken the impact assessment of 7 (seven) CSR projects carried out in FY 2021-22, through Consultivo Business Solutions Private Limited, an independent agency. The impact assessment report for FY 2021-22 is available on the website of the Company https://www. tataconsumer.com/sustainability.

INTEGRATED REPORT

The Integrated Report of the Company is prepared in accordance with the International Integrated Reporting (IR) framework published by the Value Reporting Foundation (VRF) which reflects the integrated thinking of the Company and its approach to its value creation. This report aims to provide a holistic view of the Companyâs strategy, governance and performance, and how they work together to create value over the short, medium and long term for our stakeholders. The narrative section of the Integrated Report is guided by the Integrated Reporting (IR) framework outlined by the International Integrated Reporting Council (IIRC).

CORPORATE GOVERNANCE REPORT

Pursuant to Regulation 34 read with Schedule V of the Listing Regulations, a separate section on the Corporate Governance Report, forms an integral part of the Integrated Annual Report. A certificate from Practicing Company Secretary confirming compliance with corporate governance norms, as stipulated under the Listing Regulations, is annexed to the Corporate Governance Report.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, a separate section on Management Discussion and Analysis Report which also covers the consolidated operations reflecting the global nature of our business forms an integral part of the Integrated Annual Report.

BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

In accordance with Regulation 34(2)(f) of the Listing Regulations, Business Responsibility and Sustainability Report (âBRSRâ) covering disclosures on Companyâs performance on ESG (Environment, Social and Governance) parameters for FY 2022-23, along with Independent assurance opinion statement provided by The British Standards Institution (BSI), forms an integral

part of the Integrated Annual Report. BRSR includes details on performance against the nine principles of the National Guidelines on Responsible Business Conduct and a report under each principle, which is divided into essential and leadership indicators is also part of.

DIRECTORSâ 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 including the audit of internal financial controls over financial 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 Companyâs internal financial controls were adequate and operating effectively during the financial year 2022-23.

Pursuant to Section 134 (5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that for the financial year ended March 31, 2023:

i. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

ii. They have selected such accounting policies and applied them consistently and made judgments 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 profits of the Company for that period;

iii. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. They have prepared the annual accounts on a âgoing concern basisâ;

v. They have laid down internal financial controls for the Company which are adequate and are operating effectively;

vi. They have devised a proper system to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

STATUTORY AUDITORS AND AUDITORSâ REPORT

Based on the recommendation of the Audit Committee and the Board of Directors, Members of the Company at the 59^th Annual General Meeting held on June 27, 2022, appointed Deloitte Haskins & Sells LLP, (âDeloitteâ) Chartered Accountants (ICAI Firm Registration No.117366W/W-100018) as the Statutory Auditors for the second term of 5 (five) years commencing from the conclusion of the 59^th Annual General Meeting until the conclusion of the 64^th Annual General Meeting to be held in the year 2027. The Members also approved the remuneration payable to Deloitte and authorized the Board to finalize the terms and conditions of reappointment, including remuneration of the Statutory Auditor for the remaining period, based on the recommendation of the Audit Committee.

The Statutory Auditorsâ Report for FY 2022-23 on the financial statement of the Company forms part of this Annual Report. Statutory Auditors have expressed their unmodified opinion on the Standalone and Consolidated Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, or disclaimers.

Statutory Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Act, in the year under review.

SECRETARIAL AUDITORS AND AUDITORSâ REPORT

According to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice (FCS No. 2303, Certificate of Practice No. 880), to carry out the Secretarial Audit of the Company. The Report of the Secretarial Auditor for FY 2022-23 is attached herewith as Annexure 3. There are no qualifications, observations or adverse remarks, or disclaimers in the said report.

COST RECORDS AND COST AUDITORS

During the year under review, in accordance with Section 148(1) of the Act, the Company has maintained the accounts and cost records, as specified by the Central Government. Such cost accounts and records are subject to audit by M/s Shome and Banerjee, Cost Auditors of the Company for FY 2022-23.

The Board has re-appointed M/s Shome and Banerjee, Cost Accountants (Firm Registration Number: 000001) as Cost Auditors of the Company for conducting cost audit for the FY 2023-24. A resolution seeking approval of the Shareholders for ratifying the remuneration payable to the Cost Auditors for FY 2023-24 is provided in the Notice of the ensuing Annual General Meeting.

The Cost accounts and records as required to be maintained under section 148 (1) of the Act are duly made and maintained by the Company.

RELATED PARTY TRANSACTIONS

The Company has a well-defined process of identification of related parties and transactions with related parties, its approval and review process. The Policy on Related Party Transactions as formulated by the Audit Committee and the Board is hosted on the Companyâs website at https:// www.tataconsumer.com/investors/policies. As required under Regulation 23 of the Listing Regulations, the Audit Committee has defined the material modification and has been included in the said Policy.

All contracts, arrangements and transactions entered by the Company with related parties during FY 202223 (including any material modification thereof), were in the ordinary course of business and on an armâs length basis and were carried out with prior approval of the Audit Committee. All related party transactions that were approved by the Audit Committee were periodically reported to the Audit Committee. Prior approval of the Audit Committee was obtained periodically for the transactions which were planned and/or repetitive in nature and omnibus approvals were also taken as per the policy laid down for unforeseen transactions.

None of the contracts, arrangements and transactions with related parties, required approval of the Board/ Shareholders under Section 188(1) of the Act and Regulation 23(4) of the Listing Regulations.

None of the transactions with related parties falls under the scope of Section 188(1) of the Act. The information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 does not apply to the Company for the FY 2022-23 and hence the same is not provided. The details of the transactions with related parties during FY 2022-23 are provided in the accompanying financial statements.

ANNUAL RETURN

Pursuant to Section 134(3)(a), the draft Annual Return of the Company prepared as per Section 92(3) of the Act for the financial year ended March 31, 2023, is hosted on the website of the Company and can be accessed at https://www.tataconsumer.com/investors/investor-information/annual-returns. In terms of Rules 11 and 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return shall be filed with the Registrar of Companies, with prescribed timelines.

PARTICULARS OF EMPLOYEES

The information containing details of employees as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure 4 attached to this report.

According to Section 197(14) of the Act, the details of remuneration received by the Executive Directors from the Companyâs subsidiary company during FY 2022-23 are also given in Annexure 4 attached to this report.

The statement containing details of employees as required under Section 197(12) read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (âthe Rulesâ), as amended, form part of this report and will be made available to any Member on request, as prescribed therein.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, there were no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

particulars OF LOANS, guarantees, and investments by

THE cOMPANY

The particulars of loans, guarantees, and investments covered under the provisions of Section 186 of the Act have been disclosed in the financial statements.

VIGIL MECHANISM

The Companyâs vigil mechanism allows the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud, or violation of the code of conduct /business ethics as well as to report any instance of leak of Unpublished Price Sensitive Information. The vigil mechanism provides for adequate safeguards against victimization of the Director(s) and employee(s) who avail of this mechanism. No person has been denied access to the Chairman of the Audit Committee.

The Whistle-Blower Policy of the Company can be accessed on the Companyâs website at the link: https:// www.tataconsumer.com/investors/policies.

disclosures AS PER THE SExUAL HARASSMENT OF wOMEN AT

workplace (prevention,

PROHIBITION, AND REDRESSAL) AcT, 2013

The Company has adopted zero tolerance for sexual harassment at the workplace and has formulated a policy on prevention, prohibition, and redressal of sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Awareness programs were conducted at various locations of the Company https://www.tataconsumer. com/investors/policies.

The Company has complied with provisions relating to the constitution of Internal Complaints Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company have setup ICCs for its 9 major locations to to redress complaints on sexual harassment.

During the year under, one complaint relating to sexual harassment which was pending at the beginning of the financial year, has been investigated and closed. Further, ICC had received one more complaint during the year under review and the same was pending at the end of the Financial Year ended March 31, 2023.

SECRETARIAL STANDARDS

The Institute of Company Secretaries of India has currently mandated compliance with the Secretarial Standards on board meetings and general meetings. During the year under review, the Company has complied with the applicable Secretarial Standards.

DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from the public was outstanding as on March 31, 2023.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE

The information on the conservation of energy, technology absorption, and foreign exchange earnings and outgo according to Section 134(3)(m) of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 5 attached to this report.

INDuSTRIAL RELATIONS

During the year under review, industrial relations remained harmonious at all our offices and establishments.

acknowledgement

The Directors wish to convey their deep appreciation to all the employees, customers, vendors, investors, and consultants/advisors of the Company for their sincere and dedicated services as well as their collective contribution to the Companyâs performance.

The Directors thank the Government of India, Governments of various States in India, Governments of various Countries, and concerned Government departments for their co-operation.

The Directors appreciate and value the contribution made by every member, employee, and their family of the Tata Consumer Products Group.

On behalf of the board of Directors

Mar 31, 2022

The Board of Directors is delighted to present the 59^th Annual Report on the business and operations of Tata Consumer Products Limited (âthe Companyâ) along with the summary of standalone and consolidated financial statements for the year ended March 31, 2022.

In compliance with the applicable provisions of the Companies Act, 2013, (âthe Actâ), the Securities and Exchange Board of India (âSEBIâ) (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), this Boardâs Report is prepared based on the standalone financial statements of the Company for the year under review and also present the key highlights of performance of subsidiaries, joint ventures, and associate companies and their contribution to the overall performance of the Company during the year under review.

FINANCIAL PERFORMANCE

Key highlights of consolidated and standalone financial performance for the year ended March 31, 2022, are summarised as under:

('' in Crores)
Particulars	Consolidated		Standalone
Particulars	^2021-22	2020-21 \|	2021-22	2020-21
Revenue from Operations	12,425	11,602	7,932	7,154
Profit before Exceptional Items and Taxes	1,508	1,342	1,178	897
Exceptional items (net)	(52)	(31)	(27)	(61)
Profit before Tax	1,456	1,311	1,151	836
Provision for Tax	(377)	(317)	(265)	(217)
Profit after Tax	1,079	994	886	620
Share of net profit/(loss) in Associates and Joint Ventures	(64)	(63)	-	-
Profit for the year	1,015	930	886	620
Attributable to:
- Owners of the parent	^^^^936	857 \|	886	620
Retained Earnings - Opening Balance	6,396	5,902	3,503	3,136
Add /(Less): ^
- Profit for the year	^^^936	857 \|	886	620
- Other Comprehensive Income/(Expense)	31	(112)	23	(4)
- Dividend Paid	(373)	(249)	(373)	(249)
- Other items	(18)	(1)	-	-
Retained Earnings - Closing Balance	6,972	6,396	4,039	3,503

OPERATIONS AND BUSINESS PERFORMANCE Consolidated Performance

Consolidated revenue from operations for the year at '' 12,425 Crores grew by 7% as compared to the last year. On a like-to-like basis i.e. net of exits of food service businesses in the international market, consolidated revenue improved by 9%. While the Indian Branded Business grew by 13%, led by Tea, Salt, and new engines of growth (Ready to Drink and Tata Sampann), the International Business, net of exits, was marginally lower

as compared to the previous year. India Branded Business benefitted from the expansion of the distribution reach, focus on premiumisation, and higher investment behind brands. For the International business, growth trends were witnessed similar to pre-covid levels in the later part of the year, offsetting the lower offtake in the earlier half due to covid induced pantry loading in the previous year. Improvements, mainly in Coffee plantation and extractions businesses, drove 8% growth in the NonBranded segment.

Profit before exceptional items and taxes at '' 1,508 Crores grew by 12%. Operating Margins remained healthy and improved over the prior year. India Branded Business margins improved for the year driven by tapering off of tea commodity cost, despite higher investments in brands, input cost inflation in foods, and growth initiatives. International Business margins improved over the previous year mainly due to control over spends despite a sharp increase in the coffee commodity prices. Strong headwinds faced for input cost inflation across business units in both International and Indian markets were managed well.

The Groupâs net profit at '' 1,015 Crores grew by 9% after absorbing higher exceptional expenditure whilst the share of profits from the joint venture and associates remained flat. Higher exceptional expenditure mainly represents costs incurred for restructuring and re-organisation and acquisition-related costs. Improved Joint Venture performance has been offset by an adverse performance by Associate companies. Tata Starbucksâ performance improved significantly driven by revenue recovery and the opening of additional 50 new stores, in spite of covid led restrictions impacting performance in the early part of the year. The performance of associate companies was adversely impacted by lower price realisation, lower crop and cost pressures.

Standalone Performance

Revenue from operations at '' 7,932 Crores grew by 11% reflecting growth in India Branded Business. Revenue grew mainly in the Tea, Salt, and Tata Sampann portfolio, led by higher distribution reach, investment in brands, and premiumisation. Strong support to the brands resulted in an improvement in the market share of Tea by 100 basis points and Salt by 400 basis points. Operating margins registered a healthy growth driven by tapering off of tea commodity cost in spite of input cost inflation and higher investments in brands.

Profit before exceptionals and taxes (PBIT) at '' 1,178 Crores grew by 31% led by revenue growth, improved margins and higher other income. Profit after tax at '' 886 Crores grew by 43% as compared to the previous year, mainly due to improved PBIT and lower tax rate.

DIVIDEND 8 RESERVES Dividend Distribution Policy

According to Regulation 43A of the Listing Regulations, the Board has adopted a Dividend Distribution Policy, which had been placed on the website of the Company and can be accessed at the link:

https://www.tataconsumer.com/investors/policies. and is also provided in Annexure 1 attached to this report.

Declaration and payment of dividend

The Board is pleased to recommend a dividend of '' 6.05 per equity share of the Company of '' 1 each (605%) for the year ended March 31, 2022.

The Board recommended dividends based on the parameters laid down in the Dividend Distribution Policy.

The said dividend on equity shares is subject to the approval of the Shareholders at the ensuing Annual General Meeting (âAGMâ) scheduled to be held on Monday, June 27, 2022. If approved, the dividend would result in a cash outflow of '' 557.54 Crores. The total dividend payout works out to 62.95% (Previous Year: 60.25%) of the Companyâs standalone net profit.

The dividend once approved by the Shareholders will be paid on or from June 29, 2022, and before July 27, 2022.

Book closure

The Register of Members and Share Transfer Books of the Company will remain closed from Saturday, June 11, 2022, to Friday, June 17, 2022 (both days inclusive) to determine the eligible shareholders to receive the dividend for the year ended March 31, 2022. According to the Finance Act, 2020, dividend income will be taxable in the hands of the Members w.e.f. April 1, 2020, and the Company is required to deduct tax at source from the dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961.

Unclaimed dividends

Details of outstanding and unclaimed dividends previously declared and paid by the Company are given under the Corporate Governance Report.

Transfer to reserve

As permitted under the Act, the Board does not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for FY 2021-22 in the profit and loss account.

SHARE CAPITAL

As of March 31, 2022, the authorized share capital of the Company was '' 125 Crores comprising of 125,00,00,000 equity shares of '' 1 each, and the paid-up equity share capital as at March 31, 2022, was '' 92.16 Crores comprising of 92,15,51,715 equity shares of '' 1 each.

The Company had neither issued any shares nor instruments convertible into equity shares of the Company or with differential voting rights nor has granted any sweat equity. The Company has granted Performance Share Units to the eligible employees of the Company and its subsidiary companies in the year under review, the details of the same are provided below:

Performance Share Units

Under authority granted by the Shareholders through Postal Ballot on December 28, 2021, the Company had adopted and implemented Tata Consumer Products Limited- Share-based Long Term Incentive Scheme 2021 (hereinafter referred to as âTCPL SLTI Scheme 2021â or âthis Schemeâ) for grant of 5,00,000 Performance Share Units (âPSUsâ) to the Eligible Employees of the Company and its subsidiary under this Scheme. This Scheme is intended to reward, retain and motivate the Eligible Employees of the Company and its subsidiary companies as defined in the Scheme for their performance and participation in the growth and profitability of the Company.

The Nomination and Remuneration Committee (âNRCâ) administers TCPL SLTI Scheme 2021. This Scheme is in accordance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (âSBEB&SE Regulationsâ). There has been no material variation in the terms of the PSUs granted under this Scheme.

During the year under review, the Company has granted 65,780 PSUs to the eligible employees in terms of TCPL SLTI Scheme 2021 in January 2022 and no employee was granted PSUs equal to or exceeding 1% of the issued share capital of the Company. The Vesting period for the PSU granted under the Scheme shall not be less than one year and all the PSUs would vest, based on the Companyâs performance, within a period of 3 years from the date of Grant of such PSUs.

In compliance with the requirements of the SBEB&SE Regulations, a certificate from Secretarial Auditors, confirming implementation of TCPL SLTI Scheme 2021 following SBEB&SE Regulations and shareholderâs resolution, will be available for electronic inspection by the members during the AGM of the Company.

The statutory disclosures as mandated under the Act and SBEB&SE Regulations, along with the aforesaid certificate from the Secretarial Auditors, have been hosted on the website the Company at https://www.tataconsumer. com/investors/investor-information/annual-reports.

KEY DEVELOPMENTS

Combining Tata Coffee''s business into the Company and its wholly-owned subsidiary through a Composite Scheme of Demerger and Merger

During the year under review, the Board has approved the Composite Scheme of Arrangement amongst the Company, Tata Coffee Limited (âTCLâ), and TCPL Beverages & Foods Limited (âTBFLâ) and their respective shareholders and creditors (âthe Schemeâ).

The Scheme inter alia provides for (a) as a first step, the demerger of the Plantation Business of TCL into TBFL, and in consideration, the Company (as the holding company of TBFL) will issue 1 equity share of the Company for every 22 equity shares held by shareholders of TCL (other than the Company) (âDemergerâ); (b) as a second step, followed immediately by the amalgamation of TCL [comprising the Remaining Business of TCL (as defined in the Scheme)] with the Company and in consideration, the Company will issue 14 equity shares of the Company for every 55 equity shares held by shareholders of TCL (other than the Company) (âAmalgamationâ). On the effectiveness of the Scheme, the shareholders of TCL (other than the Company) as on the record date will receive an aggregate of 3 equity shares of the Company for every 10 equity shares held by them in TCL.

Through this transaction, TCL shareholders will get access to multiple growth engines and participation in a larger and fast-growing FMCG business. The Company shareholders are expected to benefit from better synergies and business efficiencies going forward.

The Scheme is subject to inter-alia receipt of the approval of the requisite majority of the public shareholders and creditors of the Companies, the Stock Exchanges, the Securities and Exchange Board of India, Regional Director, MCA and the Registrar of Companies, National Company Law Tribunals (benches at Kolkata and Bengaluru) and other regulatory authorities, as may be applicable.

The Scheme and other documents are hosted on the website of the Company, which can be accessed at the link: https://www.tataconsumer.com/investors/scheme-of-amalgamation/tc-tcplb-with-tcpl.

Purchase of non-controlling interests in Tata Consumer Products UK through a preferential issue of equity shares

The Board has approved the acquisition of 2,38,71,793 ordinary shares of Â£1 each representing 10.15% paid-up share capital of Tata Consumer Products UK Group Limited,

United Kingdom, an existing overseas subsidiary of the Company ("TCP UKâ) from Tata Enterprises (Overseas) AG, Zug, Switzerland (âTEOâ), a minority shareholder of TCP UK, for a total purchase consideration of '' 570.80 Crores. The consideration payable shall be discharged by way of issue and allotment of 74,59,935 equity shares of the Company having a face value of '' 1 each, at a price of '' 765.16 per equity share on a preferential basis. The issue of said equity shares on a preferential basis has been approved by Shareholders through Postal Ballot on April 29, 2022, and is subject to such other regulatory approvals, as may be required under applicable law. On the issuance and allotment of shares to TEO, under this transaction, TCP UK will become a wholly-owned subsidiary of the Company and TEO would become a shareholder of the Company holding 0.80% of the paid-up capital of the Company.

The Postal Ballot Notice, result, and other documents relating to preferential issue are hosted on the website of the Company, which can be accessed at the link: https://www.tataconsumer.com/investors/shareholder-information/postal-ballots.

The above transactions, along with future re-organisation, will help unlock value for both the Company and TCL shareholders who are expected to benefit from the resulting efficiencies and operational, administrative, and financial synergies.

MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION

No material changes are affecting the financial position of the Company, after the close of the FY 2021-22 till the date of this report.

IMPACT OF COVID-19 PANDEMIC ON THE PERFORMANCE Overall the group performance was marginally impacted by the ongoing COVID-19. In the early part of the year, the 3^rd wave caused some disruptions for India Branded Business, but it was able to recover in the later part of the year. The earlier uptick in tea prices due to covid induced shortage in crop tapered off and resulted in improvement in margins. International business in the early part of the year cycled a higher base with COVID-19 induced pantry stocking, however, volume growth returned in major markets for both tea and coffee in the international space by end of FY 2021-22. Tata Starbucks was impacted in the early part of the year with store operations being disrupted, however by end of the year 2021-22, operations are normalized.

STRATEGIC INITIATIVES

Strengthen and accelerate core business

Key initiatives include focus on powering brands through higher investments, driving premiumisation, distribution expansion, and developing alternate channels for growth in India Business. The Company has met the commitment of 1.3 million outlets, in India by end-March for direct reach. Significant progress made in sales through alternate channels with modern trade growing significantly and strengthening our position in the e-commerce channel. With investments and increased distribution, market share for both tea and salt has increased.

Drive digital and innovation

Digital is being embedded into every part of the business to stay in tune with technological advancements and drive efficiencies across the value chain. The distribution chain has been completely digitised. After the implementation of SAP S/4 HANA in the India business, the platform is being rolled out across our other businesses (mainly International and Tata Coffee) and we have initiated the setup of an enterprise data platform to draw rich insights and analyse to support the business. Digital initiatives are enabling every touchpoint in the consumer journey as well as enabling automation in the supply chain. The Companyâs innovation efforts are focused on understanding and pre-empting evolving consumer trends and coming up with high-quality and differentiated products to delight these increasingly discerning consumers. The innovation contribution to turnover has increased 2x times over prior year.

Unlock Synergies

The focus is on improving efficiency and during the year significant steps were taken. Integration of Tata Soulfull and Tata SmartFoodz was completed within three months of transaction close. Operations were further streamlined in India and International markets to drive operational efficiency. The major initiatives include the Network optimization and operating model design for the foods 3P network and converting the Australian business into a distributor model. During the year, as part of our portfolio evaluation, we exited our tea cafe format Quick Service Restaurant business. This will enable our Company to better focus on its core FMCG business. A re-organisation plan was announced for the merger of

Tata Coffee Limited and simplification of the international business. This would yield operational efficiencies in management, legal and administrative costs, assist in creating a single listed entity in capturing the full value of the Group, create focused verticals for extraction and plantations, and unlocking significant potential synergies going forward. We plan to further reduce the number of operational entities in the TCP Group over the period of the next few years to drive efficiencies.

Create Future-Ready Organisation

The Company was certified as a âGreat Place to WorkÂ®â and recognized for its commitment to fostering a positive company culture with an employee-first approach. The Great Place to WorkÂ® is the global authority on workplace culture. In India, the Great Place to Work Institute partners with more than 1100 organizations annually across over 22 industries to help them build High-Trust, High-Performance Culturesâ¢ designed to deliver sustained business results. The certification is awarded post an extensive survey and based purely on employee feedback and their experience working at the organization.

Explore new opportunities

Our inorganic agenda allows us to expand into new categories and recruit new sets of consumers. With the acquisition of Tata SmartFoodz Limited, the Group forayed into the Ready to Eat (âRTEâ) category. The company owns the brand âTataQâ and a manufacturing facility that can cater to expansion in the Groupâs product portfolio. The acquisition provides a potential opportunity to unlock synergies across the value chain by integrating operations within the Group as well as the option to leverage technology to create a strong pipeline of value-added products in other parts of the food business.

Embed sustainability

As part of the Tata Group, the ethos of responsibility and sustainability are interwoven in our corporate and work philosophy. We are committed to a sustainable way of doing business and for more details refer to Management Discussion and Analysis Report.

SUBSIDIARIES, JOINT VENTURES, AND ASSOCIATE COMPANIES As defined under the Act, the Company has 42 subsidiaries, 3 joint ventures, and 2 associate companies as at March 31, 2022.

Companies that have become or ceased to be Subsidiaries, Joint Ventures, and Associates Tata SmartFoodz Limited, India (âTSFLâ)

During the year under review, the Company acquired a 100% equity stake of TSFL from Tata Industries Limited, consequent to which TSFL became a wholly-owned subsidiary of the Company with effect from November 16, 2021. TSFL is inter alia engaged in the business of manufacturing, distribution, and marketing of ready-to-eat packaged food products under the âTata Qâ brand in India.

TRIL Constructions Limited, India (âTRILCâ)

During the year under review, the Company acquired compulsorily convertible preference shares (âCCPSâ) held by the Tata Realty and Infrastructure Limited (âTata Realtyâ) in TRILC and made the additional investment by way of subscription of CCPS of TRILC. TRILC was formed as an SPV by the Company and Tata Realty with the object of real estate development of a land parcel in Bengaluru. The Companyâs effective stake in TRILC thereafter increased from 48.40% to 80.46% of the paid-up share capital of TRILC, on a fully diluted basis, resulting in TRILC becoming a subsidiary with effect from November 17, 2021 (earlier it was an associate company).

TCPL Beverages & Foods Limited, India (âTBFLâ)

TBFL was incorporated on February 25, 2022, as a wholly-owned subsidiary of the Company. The main objects of TBFL include, inter alia, carrying on the business of manufacturing, trading, producing, cultivating, and selling beverages and foods of all kinds and of cultivating coffee, tea, etc.

Except as mentioned above, no other company/entity became or ceased to be a subsidiary, joint venture, or associate during FY 2021-22 and there has been no material change in the nature of the business of the subsidiaries.

Material Subsidiaries

The Company has 3 unlisted material subsidiaries incorporated outside India i.e. Tata Consumer Products GB Limited, Tata Consumer Products UK Group Limited, and the Eight OâClock Coffee Company Limited.

In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy for determining Material Subsidiaries and the same can be accessed on the Companyâs website at https://www. tataconsumer.com/investors/policies.

During the year under review, the said Policy was reviewed and amended by the Audit Committee & the Board of Directors to encompass inter-alia the regulatory changes brought as per amendment in Regulation 16 of Listing Regulations (effective from May 5, 2021).

Consolidated Financial Statements

According to Section 129(3) of the Act, the consolidated financial statements of the Company and its subsidiaries, joint ventures, and associates are prepared in accordance with the relevant Indian Accounting Standard specified under the Act, and the rules thereunder form part of this Annual Report. A statement containing the salient features of the financial statements of the Companyâs subsidiaries, joint ventures, and associates in Form no. AOC-1 is given in this Annual Report.

Further, pursuant to the provisions of Section 136 of the Act, the financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company, at the link: https://www.tataconsumer.com/investors/investor-relations/subsidiaries/subsidiary-financials.

The details of the business of key operating subsidiaries, associates, and joint ventures during FY 2021-22 are given in the Management Discussion and Analysis Report, which forms part of this Annual Report.

PERFORMANCE HIGHLIGHTS OF KEY OPERATING SUBSIDIARIES, JOINT

VENTURES, AND ASSOCIATES

SUBSIDIARIES

Tata Consumer Products UK Group Ltd, UK (âTCP UKâ)

TCP UK reflects the financial performance of International Tea Business. The major brands are Tetley, Good Earth and Teapigs. On a like-to-like basis, i.e. net of business exits, Revenue declined by 3% in constant currency. Whilst there was revenue growth in the later part of the year, the early part of the year recorded muted performance due to Covid related pantry loading in the previous year. Profit after tax at '' 143 Crores reflected a growth of 13% as compared to the previous year. Operating Margin generally remained flat against the prior year mainly driven by control over spends despite inflation driven input cost increases. Improvement in profit after tax was aided by lower exceptional expenditure. In the current year, exceptional expenditure mainly represents costs incurred for unlocking synergies and to create a future-ready organization whilst the previous year had the impact of disposal of businesses.

In the UK, revenue was lower by 3% mainly led by softness in mainstream grocery, however, Out-ofHome consumption has grown with trends back to pre-covid levels. Teapigs and Good Earth continue to grow by 8% over the prior year with the increase in market share. Fruit & Herbal based Good Earth tea, Good Earth Kombucha and Good Energy launched in the prior year continues to grow and is getting good traction with the consumers. Operating margins marginally improved led by control over spends offset partly by inflationary trends mainly on input costs. Investment behind brands continues with a new campaign on âTetleyâ on National TV and social media.

In Canada, we continued to hold the leading position in the Tea market. For the current year, a revenue decline of 7%, in constant currency, was led by a decline in both specialty and regular tea, mainly due to Covid-related pantry stocking in the previous year coupled with covid-related restrictions in the early part of the year. The focus on digital sales led the e-commerce channel delivering double-digit growth and a Direct-to-Consumer website was launched. We continued to build on our success in Tetley Super Teas by driving distribution and launched the new Super Multivitamin teas which were supported by an integrated campaign.

Other smaller markets had a mixed performance. Australia had a favourable performance on account of the change in distribution model and Tetley continued to gain market share and firmly established itself as a significant player in the Mainstream black tea brand. US Branded Tea was impacted by volume decline due to the COVID-19 induced higher base in the previous year whilst the rest of Europeâs performance was stable.

Tata Coffee Limited, India (âTCLâ):

Revenue from Operations at '' 817 Crores grew by 11% against the prior year. Profit after tax at '' 102 Crores was marginally higher than the previous year. Revenue growth was driven by Coffee Extractions through higher volume, and value realisation, despite the challenging demand scenario in some markets. Coffee Plantations recorded growth both for Arabica and Robusta, led by higher volumes and prices. Tea plantations were impacted by lower volumes on account of adverse weather conditions and lower price realisation.

Tata Coffee Vietnam Company Limited, Vietnam (âTCVâ):

Revenue from Operations at '' 258 Crores grew by 13% against the previous year in constant currency. TCV

recorded a Profit after tax of '' 5 Crores as compared to a loss in the previous year. Revenue growth was led by higher volume and value realisation. Plant operations improved with 98% capacity utilization for the year. Profitability improvement was mainly led by revenue growth and cost mitigation strategy, despite significant inflationary pressure on costs.

Eight O''Clock Coffee Company, USA (âEOCâ):

Revenue from Operations at '' 1,296 Crores was flat against the previous year in constant currency. Profit after tax at '' 172 Crores grew by 10%. Price increase taken to manage inflation in coffee commodity costs was offset by volume-related softness mainly in bags due to covid led pantry loading in the prior year. Operating margin improved mainly due to price increases taken to partially offset inflationary pressure on green cost, proactive coffee commodity hedging, and cost management initiatives. A new Digital campaign was launched for the Eight OâClock coffee brand, "Over delivery in every cupâ and video creative for Barista blends - "Be Your Own Baristaâ proposition to drive awareness. EOC continued scaling innovations with range extensions in Flavors of America and Barista Blends.

NourishCo Beverages Limited, India (âNourishCoâ):

Revenue from Operations at '' 344 Crores grew by 83% over the previous year, driven by strong brand performance and higher distribution reach. All three flagship brands - Tata Gluco Plus, Tata Copper Water, and Himalayan registered strong growth. A new variant of Tata Gluco Plus in the form of Jelly was launched during the year which received good traction from target customers. Tata Copper Water continues to deliver substantial growth in the core markets while rapidly expanding its footprints in new geographies. Himalayan also registered double-digit growth with higher distribution and improved realisation against the prior year.

ASSOCIATES

Amalgamated Plantations Private Limited, India (âAPPLâ):

Revenue from Operations at '' 852 Crores, grew by 5%. APPL reported a net loss due to lower realization and wage cost increase. Prior year had recorded substantial increase in tea prices due to covid induced crop shortages, which tapered off in the current year. APPL with continued focus on quality initiatives achieved better realisation as compared to market trends.

Kanan Devan Hills Plantations Company Private Limited, India (âKDHPâ):

Revenue from Operations at '' 394 Crores, was lower by 8%. Profit after tax was lower as compared to the previous year mainly driven by crop loss due to extreme weather conditions.

JOINT VENTURE

Tata Starbucks Private Limited, India (âTSPLâ):

Revenue from Operations at '' 636 Crores grew by 76% and net loss declined significantly. Revenue growth was led by higher revenue realization from existing stores and due to new stores added during the year. As Covid restrictions eased through the year, robust sequential recovery of sales was achieved and added 50 new stores with expansion into 8 new cities. The new stores are a mix of landmark store openings viz., Golden Temple complex in Amritsar, Jio World Drive in Bandra Kurla Complex in Mumbai and Brahmaputra Riverfront in Guwahati, and smaller footprint stores. Tata Starbucks cafe now has 268 stores, across 26 cities in India.

For further analysis on the consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financials and Form No. AOC 1

DIRECTORS AND KEY MANAGERIAL PERSONNEL Appointments & Cessation of Directors

Mr. N. Chandrasekaran (DIN 00121863) Non-Executive, (Non-Independent) Director of the Company, who was retiring by rotation at the 58^th Annual General Meeting held on June 25, 2021 ("58^th AGMâ) was re-appointed by the Members at 58^th AGM.

Mr. P. B. Balaji (DIN 02762983), who was earlier appointed as Additional Director with effect from August 8, 2020, and in respect of whom, a notice under Section 160 of the Act was received from a member, was appointed as Non-Executive (Non-Independent) Director by the Members at 58^th AGM. Further, Mr. P. B. Balaji NonExecutive, Non-Independent Director of the Company, retires by rotation and being eligible, offers himself for re-appointment. A resolution seeking Membersâ approval for his re-appointment forms part of the Notice of the ensuing Annual General Meeting.

Dr. K. P. Krishnan (DIN 01099097) was appointed as an Additional Director under the category of NonExecutive, Independent Director with effect from October

Key Managerial Personnel

As on March 31, 2022, the following were Key Managerial Personnel (âKMPâ) of the Company as per Sections 2(51) and 203 of the Act:

a) Mr. Sunil DâSouza, Managing Director & CEO,

b) Mr. L. Krishnakumar, Executive Director & Group CFO,

c) Mr. John Jacob, Chief Financial Officer, and

d) Mr. Neelabja Chakrabarty, Company Secretary.

Pecuniary relationship or transactions with the Company

BOARD OF DIRECTORS AND MEETINGS The Board of Directors

The Board of the Company is comprised of eminent persons with proven competence and integrity. Besides the experience, strong financial acumen, strategic astuteness, and leadership qualities, they have a significant degree of commitment towards the Company and devote adequate time to the meetings and preparation. In terms of the requirement of the Listing Regulations, the Board has identified core skills, expertise, and competencies of the Directors in the context of the Companyâs businesses for effective functioning, which are detailed in the Corporate Governance Report.

Committees of the Board

As required under the Act, and the Listing Regulations, the Company has constituted the following statutory committees:

1) Audit Committee

2) Nomination and Remuneration Committee

3) Stakeholders Relationship Committee

4) Risk Management Committee

5) Corporate Social Responsibility & Sustainability Committee

22, 2021, subject to the approval of members. The Members through Postal Ballot on December 28, 2021, approved the appointment of Dr. K. P. Krishnan, as a NonExecutive, Independent Director of the Company for a term of 5 years commencing from October 22, 2021, up to October 21, 2026.

Mr. David Crean (DIN 09584874), was appointed as an Additional Director under the category of Non-Executive, Independent Director with effect from May 4, 2022, subject to the approval of members. Mr. David Crean holds office as an Additional Director, till the conclusion of the ensuing 59^th Annual General Meeting ("59^th AGMâ). A notice under Section 160 of the Act, has been received from a member nominating the candidature of Mr. David Crean for appointment as Non-Executive, Independent Director of the Company. The Nomination and Remuneration Committee (âNRCâ) and the Board have considered and recommended to the Members for the appointment of Mr. Crean as Non-Executive, Independent Director and a resolution seeking Shareholdersâ approval for his appointment forms part of the Notice of the ensuing 59^th AGM.

Mr. Siraj Chaudhry, (DIN 00161853) was appointed as an Independent Director at the 54^th Annual General Meeting held on August 18, 2017, for a period of 5 years with effect from July 3, 2017, till July 2, 2022. Based on the recommendation of the NRC, his re-appointment for a second term of 5 years is proposed at the ensuing 59^th AGM for the approval of the Members by way of special resolution.

Mr. S. Santhanakrishnan (DIN 00032049), Non-Executive, Independent Director of the Company has resigned and ceased to be a Director of the Company effective close of business hours of October 12, 2021. The Board places on record its appreciation for his invaluable contribution and guidance during his tenure as Director of the Company.

The above appointments/re-appointments were recommended by Nomination and Remuneration Committee and approved by the Board and consequently recommended by the Board to Members as applicable.

Brief particulars and expertise of directors seeking appointment/re-appointment together with their other directorships and committee memberships have been given in the annexure to the Notice of the AGM in accordance with the requirements of the Listing Regulations and Secretarial Standards.

independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1) (b) of Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation that exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

Further, the declaration of compliance with Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended by the Ministry of Corporate Affairs (âMCAâ) Notification dated October 22, 2019, regarding the requirement relating to enrollment in the Data Bank created by MCA for Independent Directors, had been received from all Independent Directors.

SELECTION AND PROCEDURE FOR NOMINATION AND APPOINTMENT OF DIRECTORS

The NRC makes recommendations to the Board regarding the appointment/re-appointment of Directors, and Key Managerial Personnel (âKMPâ) and other members of the Senior Management. The role of the NRC encompasses conducting a gap analysis to refresh the Board periodically, including each time a Directorâs appointment or re-appointment is required.

The NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertaking reference, and due diligence, and meeting potential candidates before making recommendations of their nomination to the Board. The appointee is also briefed about the specific requirements for the position including expert knowledge expected at the time of appointment.

The Remuneration Policy and the Policy on Nomination, Appointment, and Removal of Directors of the Company are available at: https://www.tataconsumer.com/ investors/policies.

In addition to the above, the Board has formed an Executive Committee to review specific business operational matters and other items that the Board may decide to delegate.

Details of all the Committees such as terms of reference, composition, and meetings held during the year under review are provided in the Report on Corporate Governance, a part of this Annual Report.

The Board, from time to time, based on the necessity, has delegated certain operational power to committees of directors formed for specific purposes like disinvestment of non-strategic investment, matters relating to the Scheme of Arrangement, Preferential issue of shares, etc.

Board Meetings

The Board meets at regular intervals to discuss and decide on the Company/business policy and strategy apart from other Board business. The Board exhibits strong operational oversight with regular presentations in quarterly meetings. The Board/Committee meetings are pre-scheduled, and a tentative annual calendar of the Board and Committee meetings is circulated to the Directors well in advance to help them plan their schedule and ensure meaningful participation in the meetings. Only in case of special and urgent business, if the need arises, the Boardâs or Committeeâs approval is taken by passing resolutions through circulation or by calling the Board Committee meetings at short notice, as permitted by law.

The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed to enable the Directors to make an informed decision.

The Board of Directors had held 7 (seven) meetings during FY 2021-22. For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Act and the Listing Regulations.

INDEPENDENT DIRECTORS'' DECLARATION

As on March 31, 2022, Mr. Bharat Puri, Ms. Shikha Sharma, Mr. Siraj Chaudhry, and Dr. K. P. Krishnan were Independent Directors on the Board.

According to the provisions of Section 149 of the Act and Regulation 25 of the Listing Regulations, the Independent Directors of the Company have submitted declarations that each of them meets the criteria of

During the year under review, the Policy was reviewed and amended by the NRC and the Board of Directors to encompass inter-a)ia the regulatory changes brought as per amendment in the Listing Regulations concerning the scope of NRC and criteria of Independence of a director.

The Companyâs governance guidelines cover aspects mainly relating to the composition and role of the Board, Chairman and Directors, Board diversity, and Committees of the Board. As per the Companyâs policy on the retirement of Directors, the retirement age for Managing/ Executive Directors is 65 years, Non-Executive (NonIndependent) Directors is 70 years, and Non-Executive, Independent Directors is 75 years.

Criteria for determining qualifications, positive attributes, and independence of a director

In terms of the provisions of Section 178(3) of the Act and Regulation 19 of the Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes, and independence of Directors, the key features of which are as follows:

â¢ Qualifications - The Board nomination process encourages diversity of thought, experience, knowledge, age, and gender. It also ensures that the Board has an appropriate blend of functional and industry expertise.

â¢ Positive Attributes - Apart from the duties of directors as prescribed in the Act, the Directors are expected to demonstrate high standards of ethical behavior, communication skills, and independent judgment. The Directors are also expected to abide by the respective Code of Conduct as applicable to them.

â¢ Independence - A director will be considered independent if he/she meets the criteria laid down in Section 149(6) of the Act, the Rules framed thereunder, and Regulation 16(1)(b) of the Listing Regulations, as amended from time to time.

ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES, AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act, Listing Regulations and the Governance Guidelines for the Tata group companies, the Board of Directors has carried out an annual evaluation of its own performance, Board Committees, and Individual Directors.

The Nomination and Remuneration Committee (âNRCâ) approved a framework in the form of a questionnaire for annual evaluation of the Board, Board Committees and Individual Directors.

The Board evaluated its performance after seeking inputs from all the Directors based on criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the Committees was evaluated by the Board after seeking inputs from the Committee members based on criteria such as the composition of committees, effectiveness of committee meetings, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

In order to ensure confidentiality, the Board evaluation was undertaken through a Board application for evaluation, managed by an independent agency. All the Directors participated in the evaluation process. The responses received from the Board members were compiled by the independent agency and a consolidated report was submitted to the Chairman of the NRC and the Chairman of the Board.

The Board and the NRC reviewed the performance of individual Directors based on criteria such as the contribution of the individual Director to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

In a separate meeting of Independent Directors, the performance of Non-Independent Directors and the Board as a whole, and the Chairman of the Company was evaluated taking into account the views of Executive Directors and Non-Executive Directors.

The above evaluations were then discussed at the Board meeting that followed the meeting of the Independent Directors and the NRC, at which the performance of the Board, its Committees, and individual Directors was also discussed. The performance evaluation of Independent Directors was done by the entire Board, excluding the Independent director being evaluated.

During the year, the Company had also actioned the feedback from the Board evaluation process conducted in FY 2020-21. The Board, Board Committees and the Independent Directors discussed the evaluation report and various suggestions received in the evaluation process in FY 2021-22 and agreed on an action plan.

REMUNERATION POLICY

According to the provisions of Section 178(3) of the Act, and Regulation 19 of the Listing Regulations, the NRC has formulated a policy relating to the remuneration for the Directors, KMP, Senior Management, and other employees.

The philosophy for remuneration is based on the commitment to fostering a culture of leadership with trust. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Act which are as under:

â¢ That the level and composition of remuneration are reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the company successfully;

â¢ The relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

â¢ Remuneration to Directors, key managerial personnel, and senior management involves a balance between fixed and incentive pay reflecting short and longterm performance objectives appropriate to the working of the Company and its goals.

The Remuneration Policy of the Company is available at: https://www.tataconsumer.com/investors/policies

The key principles governing the Remuneration Policy are as follows:

â¢ Market competitiveness;

â¢ The role played by the individual;

â¢ Reflective of the size of the company, complexity of the sector/ industry/Companyâs operations, and the Companyâs capacity to pay;

â¢ Consistent with recognized best practices; and

â¢ Aligned to any regulatory requirements.

In accordance with the Policy, the Managing Director & CEO, Executive Director, KMP, Senior Management, and other employees are paid a fixed salary which includes basic salary, allowances, perquisites, and other benefits and also annual incentive remuneration/performance-linked incentive subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time, by the NRC

and the Board. The performance-linked incentive is driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for Independent Directors and NonIndependent, Non-Executive Directors

The Non-Executive Directors, including Independent Directors, are paid sitting fees for attending the meetings of the Board and Committees of the Board. As per the policy, the overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, the complexity of the business, and the Companyâs capacity to pay the remuneration.

The Company pays a sitting fee of '' 30,000 per meeting per Director for attending meetings of the Board, Audit, Nomination and Remuneration, and Executive Committees. For Risk Management, Stakeholderâs Relationship, Corporate Social Responsibility & Sustainability Committees, and other special Board committees, a sitting fee of '' 20,000 per meeting per Director is paid. The Company also paid sitting fees of '' 30,000 per meeting per Independent Director for attending the Independent Directorsâ meeting.

Within the ceiling as prescribed under the Act, the NonExecutive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and approved by the Board. The basis of determining the specific amount of commission payable to a Non- Executive Director is related to his attendance at meetings, role, and responsibility as Chairman or Member of the Board / Committees, and overall contribution as well as time spent on operational matters other than at the meetings. The Members of the Company had approved payment of commission to the Non-Executive Directors at the Annual General Meeting held on July 5, 2018, for each financial year to be distributed among the Directors in such manner as the Board of Directors may, from time to time, determine within the overall maximum limit of 1% (one percent) per annum of net profit or such other percentage as may be specified by the Act, from time to time. No Stock option has been granted to any Non-Executive Director.

As a policy, Mr. N. Chandrasekaran, Chairman, has abstained from receiving commission from the Company.

Further, in line with the internal guidelines of the Company, no payment is made towards commission to

the Non-Executive Directors of the Company, who are in employment with any other Tata Company. Accordingly, no commission was paid to Mr. P. B. Balaji, Non-Executive (Non-Independent) Director.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS Independent Directors play a pivotal role in upholding corporate governance norms and ensuring fairness in decision-making. Being experts in various fields, they also bring independent judgement on matters of strategy, risk management, controls, and business performance.

At the time of appointing a new Independent Director, a formal letter of appointment is given to the Director, inter alia, explaining the role, duties, and responsibilities of the Director. The Director has also explained in detail the compliances required from him/her under the Act, SEBI Regulations, and other relevant regulations.

By way of an introduction to the Company, presentations are also made to the newly appointed Independent Director on relevant information like an overview of the Companyâs businesses, market and business environment, growth and performance, organizational set up of the Company, governance and internal control processes.

Ongoing familiarisation aims to provide insights into the Company and the business environment to enable all the Independent Directors to be updated on newer challenges, risks, and opportunities relevant to the Companyâs context and to lend perspective to the strategic direction of the Company.

Familiarisation programme for the Independent Directors along with the details of familiarisation programmes imparted to Independent Director during and cumulative upto FY 2021-22 is placed on the Companyâs website and the same can be accessed at the link: https://www.tataconsumer.com/corporate-governance/ compliances-and-fi lings.

BOARD DIVERSITY

The Company recognizes and embraces the importance of a diverse board in its success. The Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race, and gender, which will help the Company to retain its competitive advantage. The Board has adopted the Board Diversity Policy (as a part of the Policy on Nomination, Appointment & Removal

of Directors) which sets out the approach to the diversity of the Board of Directors. The Policy is available on the website of the Company at https://www.tataconsumer. com/investors/policies.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY The Board has adopted policies and procedures for the governance of orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention, and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures. The Companyâs internal control systems are commensurate with the nature of its business, the size and complexity of its operations and such internal financial controls concerning the Financial Statements are adequate.

The Company has a strong and independent in-house Internal Audit (âIAâ) department that functionally reports to the Chairman of the Audit Committee, thereby maintaining its objectivity. The remediation of deficiencies by the IA department has resulted in a robust framework for internal controls and details of which are provided in the Management Discussion and Analysis Report. Further, Statutory Auditors in its report expressed an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial.

AUDIT COMMITTEE

As on March 31, 2022, the Committee comprises Dr. K. P. Krishnan (Chairman), Mr. Bharat Puri, Ms. Shikha Sharma, and Mr. Siraj Chaudhry. During the year under review, Mr. S Santhanakrishnan, Non-Executive, Independent Director, ceased as Member and Chairman of the Committee w.e.f. October 12, 2021 and Mr. P.B. Balaji had stepped down as a member of the Committee w.e.f. August 3, 2021. Dr. K.P. Krishnan was appointed as a member as well as Chairman of the Committee effective October 22, 2021.

The Committee met 8 (eight) times during the year under review, the details of which are given in the Corporate Governance Report.

During the year under review, there were no instances when the recommendations of the Audit Committee were not accepted by the Board.

INTEGRATED REPORT

The Integrated reporting by the Company is in line with the Integrated Reporting framework developed by the International Integrated Reporting Council (IIRC). The Company aims to enhance its reporting in line with the framework in a phased manner.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS

The Company has complied with the corporate governance requirements under the Act, and the Listing Regulations. A separate section on Corporate Governance along with a certificate from the practicing Company Secretary confirming compliance forms an integral part of this Annual Report.

A detailed report on Management Discussion and Analysis forms an integral part of this Annual Report and also covers the consolidated operations reflecting the global nature of our business.

BUSINESS RESPONSIBILITY REPORT

In accordance with Regulation 34 (2)(f) of the Listing Regulations, for FY 2021-22, the Company is providing a Business Responsibility Report, which forms part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that for the financial year ended March 31, 2022:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

(ii) They have selected such accounting policies and applied them consistently and made judgments 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 profits of the Company for that period;

(iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) They have prepared the annual accounts on a âgoing concern basisâ;

(v) They have laid down internal financial controls for the Company which are adequate and are operating effectively;

(vi) They have devised a proper system to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

CORPORATE SOCIAL RESPONSIBILITY [âCSRâ] AND SUSTAINABILITY INITIATIVES

In compliance with Section 135 of the Act, the Company has undertaken CSR activities, projects, and programs, excluding activities undertaken in pursuance of its normal course of business. The Natural Foods & Beverages Policy of the Company is the apex Sustainability Policy that defines the aspiration to be the consumerâs first choice in sustainable production and consumption. The sustainability pillars of the Company are Sustainable Sourcing, Climate Change, Water Management, Waste Management, and Community Development.

Under Section 135 of the Act, the Company was required to spend '' 13.32 Crores (2%) of the average qualifying net profits of the last three financial years on CSR activities on projects in FY 2021-22. During the year under review, the Company has spent '' 13.54 Crores (2.03%) on CSR activities, which includes the amount spent on administrative overheads and for impact assessment. The Board of Directors at their Meeting approved the same. Accordingly, the Company has met its obligation of spending '' 13.32 Crores for FY2021-22. In addition to the projects specified as CSR activities under section 135 of the Act, the Company has also carried out several other sustainability/responsible business initiatives and projects on a global scale.

The Annual Report on CSR containing the composition of the CSR & Sustainability Committee, salient features of the CSR Policy, details of activities, and other information as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 are provided in Annexure 2 attached to this Report. The CSR Policy may be accessed on the Companyâs website at the link: https:// www.tataconsumer.com/investors/policies.

Since the average CSR obligation for the preceding 3 financial years i.e. FY 2018-19, FY 2019-20, and FY 202021 was less than '' 10 Crores, the impact assessment report was not applicable in FY 2021-22. However, the Company has voluntarily undertaken the impact assessment of CSR projects carried out in FY 2020-21, through an independent agency. The impact assessment report for FY 2020-21 is available on the website of the Company https://www.tataconsumer.com/sustainability.

STATUTORY AUDITORS AND AUDITORS'' REPORT At the 54^th AGM held on August 18, 2017, the Members had approved the appointment of Deloitte Haskins & Sells LLP, (âDeloitteâ) Chartered Accountants (ICAI Firm Registration No.117366W/W-100018) as the Statutory Auditors for a period of 5 (five) years commencing from the conclusion of the 54^th AGM until the conclusion of the 59^th AGM to be held in the year 2022. Accordingly, their first term as Statutory Auditors expires at the conclusion of the 59^th AGM.

Pursuant to the provisions of Section 139(2)(b), an audit firm can be appointed for two terms of five consecutive years each. Accordingly, the Board approved the reappointment of Deloitte based on the recommendations of the Audit Committee and the same is subject to the approval of the Members of the Company. The Notice of ensuing 59^th AGM includes the proposal for seeking Membersâ approval for the re-appointment of Deloitte as the Statutory Auditors, for the second term of 5 (five) years commencing from the conclusion of the 59^th AGM until the conclusion of the 64^th AGM to be held in the year 2027.

deloitte has provided their consent and a certificate of their eligibility under sections 139 and 141 of the Act and the Companies (Audit and Auditors) Rules 2014 for their continuance as the Statutory Auditors of the Company for the second term of 5 (five) years. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI. Accordingly, Deloitte is eligible for re-appointment as Statutory Auditors of the Company.

The Statutory Auditorsâ Report for FY 2021-22 on the financial statement of the Company forms part

of this Annual Report. Auditors have expressed their unmodified opinion on the Standalone and Consolidated Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, or disclaimer.

The Statutory Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Act, in the year under review.

SECRETARIAL AUDITORS AND AUDITORS'' REPORT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice (FCS No. 2303, Certificate of Practice No. 880), to carry out the Secretarial Audit of the Company. The Report of the Secretarial Auditor for FY 2021-22 is attached herewith as Annexure 3. There are no qualifications, observations or adverse remarks, or disclaimer in the said report.

COST RECORDS AND COST AUDITORS

The Board has re-appointed M/s Shome and Banerjee, Cost Accountants (Firm Registration Number: 000001) as Cost Auditors of the Company for conducting cost audit for the FY 2022-23. A resolution seeking approval of the Shareholders for ratifying the remuneration payable to the Cost Auditors for FY 2022-23 is provided in the Notice of the ensuing Annual General Meeting.

The Cost accounts and records as required to be maintained under section 148 (1) of the Act are duly made and maintained by the Company.

RISK MANAGEMENT

The Company has an elaborate risk charter and risk policy defining the risk management governance model, risk assessment, and prioritization process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an update to the Board on the Companyâs risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls.

Additionally, a third-party organization has benchmarked the Companyâs risk management practice with various companies in India and globally and pronounced it as a leader the FMCG category. The Company was consecutively for the third time declared as the winner in the category in "Master of Risk in FMCG categoryâ, at the eighth edition of The India Risk Management Awards 2022 by CNBC TV-18 and ICICI Lombard. These awards recognize those organizations and teams that have significantly added to the understanding and practice of risk management.

VIGIL MECHANISM / WHISTLE-BLOWER POLICY The Companyâs vigil mechanism allows the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud, or violation of the code of conduct /business ethics as well as to report any instance of leak of Unpublished Price Sensitive Information. The vigil mechanism provides for adequate safeguards against victimization of the Director(s) and employee(s) who avail of this mechanism. No person has been denied access to the Chairman of the Audit Committee.

The Whistle-Blower Policy of the Company can be accessed on the Companyâs website at the link: https:// www.tataconsumer.com/investors/policies.

PARTICULARS OF LOANS, GUARANTEES, AND INVESTMENTS BY THE COMPANY

The particulars of loans, guarantees, and investments covered under the provisions of Section 186 of the Act have been disclosed in the financial statements.

RELATED PARTY TRANSACTIONS

During the year under review, all Related Party Transactions (RPTs) entered into by the Company were on an armsâ length basis and in the ordinary course of business. These RPTs did not attract provisions of Section 188 of the Companies Act, 2013 and were also not material RPTs under Regulation 23 of the Listing Regulations. All related party transactions were approved by the Audit Committee and are periodically reported

to the Audit Committee. Prior approval of the Audit Committee was obtained periodically for the transactions which were planned and/or repetitive in nature and omnibus approvals were also taken as per the policy laid down for unforeseen transactions.

None of the transactions with related parties falls under the scope of Section 188(1) of the Act. The information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 does not apply to the Company for the FY 2021-22 and hence the same is not provided. The details of the transactions with related parties during FY 2021-22 are provided in the accompanying financial statements.

The transactions with the person or entity belonging to the promoter/ promoter group which holds (s) 10% or more shareholding in the Company have been disclosed in the accompanying financial statements.

In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy on Related Party Transactions and the same can be accessed on the Companyâs website at https://www.tataconsumer. com/investors/policies.

During the year under review, the Policy was reviewed and amended by the Audit Committee and the Board of Directors to encompass inter-alia the regulatory changes brought as per amendment in Regulation 23 of the Listing Regulations (effective from January 1, 2022) as well to bring more clarity on certain other operational aspects as per industry benchmark.

The said Policy was further amended by the Audit Committee and the Board of Directors on May 3 & 4, 2022 respectively, to encompass inter-alia the regulatory changes brought as per amendment in Regulation 23 of Listing Regulations (effective from April 1, 2022) and criteria for material modification of related party transactions.

ANNUAL RETURN

As provided under Section 92(3) & 134(3)(a) of the Act, the Annual Return for FY 2021-22 is uploaded on the website of the Company and can be accessed at https:// www.tataconsumer.com/investors/investor-information/ annual-returns.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and

Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure 4 attached to this report.

Pursuant to Section 197(14) of the Act, the details of remuneration received by the Executive Director from the Companyâs subsidiary company during FY 2021-22 are also given in Annexure 4 attached to this report.

The statements required under Section 197(12) read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (âthe Rulesâ), as amended, form part of this report and will be made available to any Member on request, as prescribed therein.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

INDUSTRIAL RELATIONS

During the year under review, industrial relations remained harmonious at all our offices and establishments.

DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION, AND REDRESSAL) ACT, 2013

The Company has complied with provisions relating to the constitution of the Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

There were no complaints relating to sexual harassment pending at the beginning of the financial year. During the year under review, ICC received two complaints of which one was resolved and the other was under investigation at the end of the financial year. Accordingly, one complaint remained pending as on the end of the Financial Year 2021-22.

SECRETARIAL STANDARDS

DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from the public was outstanding as on March 31, 2022.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO [PURSUANT TO COMPANIES (ACCOUNTS) RULES, 2014]

The information on conservation of energy, technology absorption, and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 5 attached to this report.

ACKNOWLEDGEMENT

The Directors thank the Government of India, Governments of various States in India, Governments of various Countries, and concerned Government departments for their co-operation.

The Directors regret the loss of life due to the COVID-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic.

The Directors appreciate and value the contribution made by every member, employee, and their families of the Tata Consumer Products Group.

On behalf of the Board of DirectorsN. Chandrasekaran Mumbai Chairman

May 4, 2022 (DIN 00121863)

Mar 31, 2021

The Board of Directors is delighted to present the 4^th Integrated Report (prepared as per the framework set forth by the International Integrated Reporting Council) and 58^th Annual Report on the business and operations of Tata Consumer Products Limited (âthe Companyâ) along with the summary of standalone and consolidated financial statements for the year ended March 31, 2021.

In compliance with the applicable provisions of the Companies Act, 2013, (âthe Actâ), SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), this Boardâs Report is prepared based on the standalone financial statements of the Company for the year under review and also present the key highlights of performance of subsidiaries, associates and joint venture companies and their contribution to the overall performance of the Company during the year under review.

FINANCIAL PERFORMANCE

Key highlights of consolidated and standalone financial performance for the year ended March 31, 2021, are summarized as under:

(Rs. in Crores)
	Consolidated		Standalone
	2020-21	2019-20	2020-21	2019-20
Revenue from Operations	11,602	9,637	7,154	5,690
Profit before Exceptional Items and Taxes	1,342	1,084	897	781
Exceptional items (net)	(31)	(275)	(61)	(52)
Profit before Tax	1,311	809	836	729
Provision for Tax	(317)	(274)	(217)	(206)
Profit after Tax	994	535	620	524
Share of net profit/(loss) in Associates and Joint Ventures	(63)	(75)	-	-
Profit for the year	930	460	620	524
Attributable to:
- Owners of the parent	857	460	620	524
Retained Earnings - Opening Balance	5,902	5,667	3,136	2,784
Add /(Less):
- Profit for the year	857	460	620	524
- Other Comprehensive Income/(Expense)	(112)	23	(4)	(21)
- Dividend Paid	(249)	(189)	(249)	(186)
- Other items	(1)	(58)	-	35
Retained Earnings - Closing Balance	6,396	5,902	3,503	3,136

OPERATIONS AND BUSINESS PERFORMANCE Consolidated Performance

The consolidated revenue at Rs. 11,602 Crores reflect an increase of 20% over previous year with improvement both in Branded and Non-branded businesses. India Beverages Business grew by ~36% led primarily by Branded Tea business growth which grew in volume as well as value. India Foods Business grew by ~18% primarily led by Salt and Pulses. International Business growth at 8% (1% in constant currency) was muted, mainly due to the impact of Covid pandemic on Food Service and Out-of-Home

sectors. Excluding Food Service and Out-of-Home sectors International business grew by 12% (5% in constant currency) mainly driven by Retail and Online segments. Our Non-Branded business also performed well with a growth of 15% (13% in constant currency) led by improvements in our Instant Coffee Business in Vietnam and improved plantation performance.

The profit before exceptional items and taxes (PBIT) at Rs. 1,342 Crores, grew by 24% over the previous year, mainly due to sales growth and rationalisation of expenses.

The profits from operations for India Beverages Business grew despite the significant increase in commodity costs mainly due to higher sales and rationalisation of expenses while we continued to invest in our brands. For India Foods Business, profit improved due to higher sales, focus on brands and rationalisation of spends. In India, we commenced the integration of the Foods Business acquired last year which has started yielding synergy benefits both on the top line as well as on the bottom line. The International Business registered a significant improvement in profits led by sales growth, gross margin expansion and cost rationalisation across the businesses. The consolidated financial statements for the year also include the part year impact of acquisition of NourishCo Beverages Limited (âNourishCoâ) (which was converted from a joint venture into a wholly-owned subsidiary effective May 2020) and Tata Consumer Soulfull Private Limited (acquired in February 2021). The profitability of our Non-Branded Business recorded a growth due to increased profitability from our instant coffee business in Vietnam and improved plantation performances.

The group net profit at Rs. 930 Crores, reflected a ~2x growth as compared to the previous year mainly due to improved PBIT, lower exceptional expenditure, lower tax rates and improved performance from JVâs and Associates. The exceptional items, in year under review, mainly include restructuring and reorganisation costs relating to integration of India Foods and Beverages Businesses, loss on disposal of certain businesses (Empirical LLC & Southern Tea LLC in USA and MAP Coffee business in Australia), partly offset by fair value gains on conversion of NourishCo from joint venture to a wholly-owned subsidiary whilst during prior year it mainly comprised of impairment of goodwill and merger related costs.

Standalone Performance

The standalone revenues of Rs. 7,154 Crores reflected an increase of 26% over previous year mainly driven by volume growth of 12% in the Indian Branded Tea portfolio, which was seen across the different type of brands i.e. Economy and Premium. The Foods Business grew at ~18% in value terms primarily led by growth in Salt volumes. The profit before exceptional items and taxes (PBIT) at Rs. 897 Crores, was higher than the previous year by 15%, mainly led by higher sales (across Beverages and Foods Business) despite steep decline in gross margin resulting from record tea costs inflation and higher spends behind brands. The profit after tax at Rs 620 Crores reflected a growth of 18% mainly due to improved PBIT, lower tax rate, partly offset by higher exceptional expenditure. The exceptional expenditure mainly represents restructuring and reorganisation costs which includes costs relating to integration of the Indian Beverages and Foods Business.

DIVIDEND & RESERVES Dividend Distribution Policy

Pursuant to Regulation 43A of Listing Regulations, the Board adopted a Dividend Distribution Policy, which had been placed on the website of the Company and can be accessed at the link: https://www.tataconsumer.com/ investors/policies.

Declaration and payment of dividend

The Board is pleased to recommend a dividend of Rs. 4.05 per equity share of the Company of Re. 1 each (405%) for the year ended March 31, 2021.

The said dividend on equity shares is subject to approval of the Shareholders at the ensuing Annual General Meeting (âAGMâ) scheduled to be held on Friday, June 25, 2021. If approved, the dividend would result in a cash outflow of Rs. 373.23 Crores. The total dividend payout works out to 60.25 % (Previous Year: 47.5%) of the Companyâs standalone net profit.

The dividend once approved by the Shareholders will be paid on or after June 29, 2021 and before July 25, 2021.

Book closure

The Register of Members and Share Transfer Books of the Company will remain closed from Saturday, June 12, 2021 to Friday, June 18, 2021 (both days inclusive) to determine the eligible shareholders to receive the dividend for the year ended March 31, 2021. According to the Finance Act, 2020, dividend income will be taxable in the hands of the Shareholders w.e.f. April 1, 2020, and the Company is required to deduct tax at source (âTDSâ) from the dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961.

Unclaimed dividends

Details of outstanding and unclaimed dividends previously declared and paid by the Company are given under the Corporate Governance Report.

Transfer to reserve

As permitted under the Act, the Board do not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for FY 2020-21 in the profit and loss account.

SHARE CAPITAL

As on March 31, 2021, the authorised share capital of the Company was Rs.125 Crores comprising of 125,00,00,000 equity shares of Re. 1 each and the paid-up equity share capital as at March 31, 2021 was Rs. 92.16 Crores comprising of 92,15,51,715 equity shares of Re. 1 each. During FY 2020-21, the Company had neither issued any shares nor instruments convertible into equity shares of the Company or with differential voting rights nor has granted any stock options or sweat equity.

MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION

There are no material changes affecting the financial position of the Company subsequent to the close of the FY 2020-21 till the date of this report.

IMPACT OF COVID-19 PANDEMIC ON THE PERFORMANCE

The impact of pandemic started in March 2020 with Governments announcing lockdown across the world to control the spread of the virus. This was followed by restricted easing of services across different countries to be followed by further rounds of lockdowns (including localised lockdowns) initiated across different countries. There was also positive news in the latter half of the year with vaccine approvals and launch of vaccination drives in several countries.

We saw varied effects across our different businesses -retail businesses were positively impacted with increase in at home consumption and pantry loading (especially in the initial stages of the lockdown) while Out-of-Home and Institutional business saw drastic decline in volumes. In the first few months of operations, we initially struggled in India due to logistical challenges with limited manpower availability and restriction in movement of transport but we were able to streamline operations successfully. During this period, we also strengthened our direct distribution reach in India by partnering with Flipkart (whereby the Companyâs distributors could list themselves as marketplace sellers) and food delivery apps (such as Dominoâs Pizza).

There were also additional growth opportunities due to our organized supply chain and we were able to leverage on the opportunity to increase presence over competition.

Amongst our B2B businesses, our Extraction Business (both Tea and Coffee) was impacted during the year with the pandemic (loss of production with nationwide lockdown and reduced demand from customers). Starbucks and Tata Cha stores saw the closure of stores from mid of March with home delivery starting for some stores from April 2020 onwards.

The Plantation operations of the Company, its subsidiary-Tata Coffee Limited and associates - Amalgamated Plantations Private Limited (âAPPLâ) and Kanan Devan Hills Plantations Co. Private Limited (âKDHPâ) resumed operations in April 2020 albeit with lower work force. With the lockdown, there was decline in tea production levels which led to an exceptional increase in tea prices which impacted our performance in second half of the year.

In terms of impact on the financial performance, the Groupâs performance was not adversely impacted by the Covid pandemic and it recorded good top line growth in many markets, except for some businesses, in particular, those in out-of-home consumption sectors. The commodity costs were however adversely impacted in India, as earlier pointed out. There can be future business uncertainties depending on developments in relation to the pandemic, particularly those arising from the second wave in India, which could include market closures, supply constraints and commodity cost volatility.

STRATEGIC INITIATIVES

During the year under review, the Company has completed the integration of India Beverages Business and India Foods Business.

At the beginning of the financial year, the Company has acquired the entire stake of PepsiCo in NourishCo Beverages Limited along with rights over the âGluco Plus/ Gluco â brand, whereby NourishCo became a wholly-owned subsidiary of the Company.

Further, in line with the Companyâs strategic intent of entering new adjacent categories in the food space, the Company has acquired 100% equity stake in Kottaram Agro Foods Private Limited, a company engaged in the business of breakfast cereals and millet-based snacks under the trademark âSoulfullâ. Through this acquisition, the Company added healthy breakfast cereals and millet-based snacks under the trademark âSoulfullâ in its portfolio. Post-acquisition, the name of this company was changed to Tata Consumer Soulfull Private Limited.

Additionally, the Company exited the branded coffee business in Australia in line with the Companyâs portfolio rebalancing strategy. Earth Rules Pty Ltd, Australia, an overseas step-down subsidiary of the Company, sold its Coffee Business (through a slump sale of assets), along with the contracts, assets and brands. The Company also disposed-off its entire membership interest held in Empirical Group LLC (Empirical) USA, a subsidiary and in Southern Tea, LLC (Southern Tea) USA, a joint venture to its venture partner in these entities - Harris Tea Company LLC on March 31, 2021. The exits from both the entities are in-line with the Companyâs strategy to focus on the core branded business, as the businesses of the above entities did not have synergies with core branded business of the Company. Coffee Trade LLC, the Companyâs step-down subsidiary, which was incorporated as part of restructuring of operations in Russia, was under liquidation in FY 2019-20 and consequent to completion of the restructuring, was liquidated on April 9, 2020.

Our values represent who we are. As a TATA company, we are a values-driven organisation, and this informs the way we do business - through Empathy, Integrity, Excellence, Ownership and Agility, we deliver superior value to all our stakeholders.

These values guide our behaviors and our actions every day, inspiring us to achieve our vision for âBuilding better lives and thriving communities.â

NEW PRODUCT DEVELOPMENT (NPD)

Innovation is one of the 6 key strategic pillars identified for growth of the Company. In the year under review, the Company has made significant investments in the area of innovation capabilities, which has started to show great results.

To sharpen organisational approach to NPD launches, clearly defined stage gate, NPD process has been implemented and category-wise commercial guardrails have been defined. A robust governance mechanism has been put in place with monthly innovation counsel chaired by CEO along with leadership team. The Research & Development (âR&Dâ) structure is re-organized with focus on 4 key pillars - Category led R&D verticals, Scientific Research, Analytical services and Global Packaging to drive future innovation pipeline. The key focus for R&D is to drive innovation to deliver differentiated products with stronger nutritional claims or new to market across business categories.

As a result of sharpened approach to NPD launches, the Company has seen significant ramp up in innovation delivery - 14 New Product launches in India and close to 10 new launches in International business.

Packages Beverages

Tata Tea Tulsi and Tata Tea Gold Care have been launched with strategic intent to play in health and wellness space. In the last quarter of the year under review, a range of premium coffee and teas were launched under Tata Coffee Sonnet and Tata Tea 1868 brands through D2C portal. Tata Tea Quick Chai, which offers the promise of boiled tea taste to consumers in a convenient form, got re-launched in India and subsequently in US as part of lift and shift strategy.

Packaged Foods

Driving the promise of nutrition with convenience, Tata Sampann brand has launched a range of products in last 6 months of the year under review. This include Tata Sampann Thin Poha, new range of nutrimixes - Supergrain Ragi mixes (Dosa and Idli), Protein rich Khaman Dhokla and Masala Dhaliya Khichdi mix. Driving forward the credentials of Tata Sampann Haldi, business also launched Tata Sampann Haldi Doodh mix (with goodness of Ashwagandha, Mulethi, Cardamom and Black pepper).

The consolidated and standalone numbers, accordingly, includes the impact of these acquisitions and the above exits.

Further, region-wise and segment-wise performances are chalked out in Management Discussion and Analysis report forms part of this Annual Report.

NEW MISSION, VISION, VALUE OF THE COMPANY

The Company stand âFor Betterâ, its brand purpose that was defined after the merger of the Foods and Beverages Business and the renaming of the Company as Tata Consumer Products Limited. We bring this to life by pushing boundaries in everything we do - quality of our products and services, our contribution to people and the productivity across our workplaces.

The Company developed its Mission & Vision, by seeking its employee feedback, looking at extensive global benchmarks, sought leadership feedback and paid very close attention to our employee voice, to truly accomplish our aspirations.

Our Vision - âTo build better lives and thriving communitiesâ

â¢ Building better lives inspires us to create better products, deliver greater value to our stakeholders and encourage our consumers to make healthy choices.

â¢ We aspire to help the communities we live, work and serve in thrive by engaging with them in a meaningful and sustainable way. Our actions in terms of volunteering programs, mindful utilization of resources, assisting our vendors and customers, engagement with like-minded partners and supporting relevant causes in our neighborhoods will help build thriving communities - one step at a time.

Our Mission - âPassionately growing and innovating every dayâ

â¢ We firmly believe that Passion is a very important element of our day-to-day actions. It allows us to dream the impossible, take calculated risks and have fun along the way as we create, nurture, grow and innovatively deliver the very best for our consumers.

Our vision and mission along with our purpose to stand âFor betterâ provides a platform to our aspirations to be a leading and differentiated consumer products company that creates better products, provides healthier choices to consumers, helps to build thriving communities and delivers superior productivity in a sustainable way.

Liquid Beverages

With strategic intent to leverage NourishCo go-to-market, Tata Fruski has been launched in February 2021 in South India market with 3 new products- Mast Mango, Lemon Masala, Jeera Masala in 2 different SKUs.

International business

Fueling the innovation funnel in International market, Australia and Canada took Health and Wellness to the next level. Australia launched 3 new products under Tetley with naturally fortified claims - Immune, Boost and Digest. Canada added 2 more Super Teas, strengthening the credentials in Health and wellness. UK launched an exciting new range of Tetley Herbals - infusions brimming with natural, zingy goodness to help you refresh and wind down. Also 2 new RTD products have been launched in last 12 months under Good Earth Brand- Kombucha and Good Energy Guayusa, strengthening our RTD play to recruit new consumers. US saw launch of Tetley British blends -Full flavored black teas with distinguished character along with range of Eight OâClock Coffee launches - Cafe Arriba, Barista Blends and Flavors of America.

BUSINESS INTEGRATION

The merger of the Consumer Products Business of Tata Chemicals Limited with the Company was completed in February 2020 and led to the renaming of the Company as Tata Consumer Products Limited with the goal of bringing together two complementary and individually successful businesses and lay the foundation for a fast-moving consumer goods (FMCG) company. This transaction offered an opportunity to create a sizeable consumer company in India with enhanced scale and financial strength, build best in class processes and unlock cost and revenue synergies across distribution, marketing, and supply chain.

A dedicated Integration Management Office (IMO) team was established that worked in close coordination with functional leaders to ensure unified ways of working and realise synergies.

The merger was consummated in ~9 months and the scheme of arrangement came into effect from February 7, 2020. In the first ~100 days post the merger, the most critical decisions were brought to a governing committee/working group and suggestions proposed acted as guidelines to drive the value in this transformation. Though there were many challenges in the midst of the

Covid pandemic to mount this change, a strong weekly cadence of progress measurement and detailed change management processes enabled robust governance and resulted in successful integration.

The integration and transformation effort at the Company focused on the following:

â¢ Future Ready Organisation: The vision was to create a future-ready organisation structure to enable the journey for multicategory FMCG company. Structure to serve combined business was rolled out across levels and functions within 3 months of integration. Additionally, more than 100 processes were harmonized to ensure unified ways of working, including the transformation of critical processes. The cost and revenue synergies were identified and tracked and were in line with market expectations.

â¢ Sales & Distribution (S&D) Integration: To achieve scale, the S&D structure was redesigned with rationalized Go-to-Market (GTM) layers and integrated multi-category channel partners. Additionally, to achieve growth in outlet reach, an increased fleet on street was deployed and enabled with digital tools to ensure visibility and agility.

â¢ Supply Chain Integration: With the integration of front-end channel partners, efforts were taken to integrate Carrying and Forwarding Agent (CFA) locations across erstwhile Food and Beverages Business and ensure direct delivery. The vendor base, distribution network, and warehouse network were also optimized to achieve synergies.

â¢ Digital Transformation: To develop a future-ready organisation, digital tools were identified across functions to improve efficiency. Enterprise Resource Planning (ERP) systems of erstwhile Food and Beverages Businesses were integrated and migrated to SAP S4 HANA for India business.

The Company has strategized 5-year roadmap detailing growth opportunities for core categories and expansion strategy into adjacencies. In its effort to accelerate the time to market, the Company has acquired Kottaram Agro Foods Private Limited, owner of the âSoulfullâ brand, thereby marking its entry into the mini-meals category. The integration of this business is currently underway and is expected to be completed by Q1 FY 2021-22.

The details of the business of some of the subsidiaries, associates, and joint ventures during FY 2020-21 are given in the Management Discussion and Analysis report, which forms part of this Annual Report.

PERFORMANCE HIGHLIGHTS OF KEY OPERATING SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

Subsidiaries

Tata Consumer Products UK Group Ltd, UK (âTCPGâ),

substantially reflects the financial performance of the Tetley business and a few other international brands.

Strong profit before exceptional items and taxes (PBIT) performance for the year under review was delivered whilst revenue growth was flat in constant currency on an underlying basis, excluding the impact of businesses disposed-off, namely, MAP coffee business in Australia and Tata Global Beverages Czech Republic in the previous year. Revenue growth was witnessed in retail / online segments across markets whereas the Out-of-Home business and Foodservice business was impacted. PBIT grew by ~58% mainly due to improvement in gross margin with margin expansion and rationalization of other expenses. Group Net profit was significantly higher than the prior year arising from lower exceptional expenditure and improved business performance. Exceptional expenditure in the current year represents the impact of disposal of businesses, whilst in the previous year, exceptional expenditure mainly represented impairment of goodwill.

In UK, the top-line reflected a growth of 2% in constant currency whilst market share was flat. There was good growth in grocery, online and discounters whilst Out-of-Home was impacted due to lockdowns. It is worth mentioning that Teapigs, our super-premium brand, continued its remarkable journey and for the year delivered the highest YoY growth since FY14. The business continues to invest behind its brands and had invested in the master brand campaign during the year with a TV commercial âNow weâre Talkingâ. New products such as Good Earth (Fruit & Herbal based) tea was launched to enhance our play in the non-black tea market and Good Earth Kombucha and Good Energy was launched in the Ready to Drink (RTD) space. UK delivered growth in profitability due to a mix of gross margin expansion, arising from lower tea costs, trade spend effectiveness and reduced overheads.

Canada had a standout performance in 2020-21, with Tetleyâs market leadership driving extraordinary retail sales on the back of Covid induced buying. We have gained market share from an already very strong share position. Tetley continues to be a strong brand in the market with both regular and specialty teas outgrowing the category during the year. For the year, the overall revenue growth was 15% in constant currency whilst Specialty, the star performer, grew by 35% over the previous year, Two new

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

As defined under the Act, the Company has 39 subsidiaries, 3 associates and 3 joint venture companies as on March 31, 2021.

Companies that have become or ceased to be Subsidiaries, Associates and Joint Ventures

During the year under review, the Company acquired a 100% equity stake of Tata Consumer Soulfull Private Limited (formerly Kottaram Agro Foods Private Limited), which became a wholly-owned subsidiary of the Company. NourishCo Beverages Limited, a 50:50 Joint Venture of the Company became a wholly-owned subsidiary in May 2020. Coffee Trade LLC, Russia, the Companyâs step-down subsidiary, was liquidated on April 9, 2020.

Earth Rules Pty Ltd, Australia, an overseas step-down subsidiary of the Company, has sold its Coffee Business (through slump sale of assets), along with the contracts, assets and brands. The Company had also sold off its entire membership interest held in Empirical Group LLC, an overseas step-down subsidiary in USA and in Southern Tea, LLC, an overseas step-down joint venture company in USA, to Harris Tea Company LLC, our partner in these entities, on March 31, 2021.

Other than these, no other company became or ceased to be a subsidiary, joint venture, or associate during FY 202021 and there has been no material change in the nature of the business of the subsidiaries.

Material Subsidiaries

The Company has two unlisted material subsidiaries incorporated outside India i.e. Tata Consumer Products GB Limited and Tata Consumer Products UK Group Limited. The Eight OâClock Coffee Company Limited is an unlisted material subsidiary of Tata Coffee Limited, the listed subsidiary of the Company.

Consolidated Financial Statements

According to Section 129(3) of the Act, the consolidated financial statements of the Company and its subsidiaries, associates, and joint ventures, prepared in accordance with the relevant Accounting Standard specified under the Act, and the rules thereunder form part of this Annual Report.

A statement containing the salient features of the financial statements of the Companyâs subsidiaries, associates, and joint ventures in Form no. AOC-1 is given in this Annual Report. Further, pursuant to the provisions of Section 136 of the Act, the financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company, in the link: https://www.tataconsumer.com/investors/investor-relations/subsidiaries/subsidiary-financials innovations were launched in market. Tetley Cold Infusions and Tetley Supers range extensions in health & wellness fortified teas, which has played into a strong and current consumer need for protection and immunity. The business recorded a strong growth in profitability led by higher sales, lower promotions and strong control on overheads.

Other smaller markets had a mixed performance. Whilst branded tea business excluding foodservice in the US performed well, markets in Australia and Europe were impacted due to extended lockdowns.

Tata Coffee Limited (âTCLâ), India reported improved revenue from operations of Rs. 737 Crores, registering an increase of 4% as compared to previous year. The profit after tax also grew by 38% over previous year.

During the financial year 2020-21, TCL had a good harvest of Robusta and Arabica crop, the density and volume of primary grade Pepper has been good, considering the timely receipt of natural shower during the development stage. TCL has initiated actions to increase the production base of pepper in the coming years. For instant coffee business, despite a tough market environment impacted by repeated lockdowns and a drop in foodservice demand particularly in our larger markets of Russia and EU, TCL was able to maintain its shares with large clients, focus on niche market opportunities and execute on our new product development work.

Tata Coffee Vietnam Company Limited, Vietnam, wholly owned subsidiary of Tata Coffee Limited, which has a state-of-the-art freeze-dried instant coffee plant with an annual capacity of 5000MT, has delivered ~90% capacity utilization with enhanced yields and other operational metrics. Accordingly, sales improved by 72% (in constant currency) and significant improvement in PBIT. It has a one-of-a-kind pilot plant, which has been helping the facility to co-create innovative niche products with its customers. 17 new product blends have been successfully commercialized and around a dozen new customers have been on boarded this year. The products from the Freeze-dried plant have enabled its customers win awards for product excellence. The Unit is already setting benchmark standards on Safety with zero safety incidents as well as setting high standards in Food safety standards.

Eight OâClock Coffee Limited (âEOCâ), USA, reported a revenue during the year of Rs 1,293 Crores reflecting a growth of 9% as compared to the previous year in constant currency. The improvement is mainly driven by improved performance in Bags and K Cups. EOC continues to focus on innovations with a healthy pipeline and is also investing in new capabilities on e-commerce. All the recent innovations launched by EOC Coffee - EOC Barista Series, Flavors of America, K-cups new sizes - have gained distribution. New, proprietary Sustainability initiative from

EOC, Rooted in Responsibilityâ¢ reflects its commitment to the coffee farms and farming households, including women & children. Profitability increased due to higher revenue.

Tata Tea Extractions Inc. USA, had a stable performance as compared to the prior year notwithstanding the impact of the Covid pandemic. For the year ended March 31, 2021, sales and operating profits were in line with the previous year.

NourishCo Beverages Limited (âNourishCoâ), India, reported a revenue from operations for the year of Rs 188 Crores. The Company had acquired PepsiCoâs stake in NourishCo in May 2020 and thus NourishCo has become a wholly-owned subsidiary of the Company from May 2020. NourishCo operated in a difficult business environment with the pandemic impacting the business during peak season. The closure of Out-of-Home channel which persisted for a longer part of the year also had a significant negative impact especially at the premium end where Himalayan plays. Inspite of the impact of the pandemic on the business, the performance for FY 2020-21 was at par with FY 2019-20 on the back of rapid growth in Q3 and Q4 of FY 2020-21.

Tata Consumer Soulfull Private Limited, India, In February 2021, the Company has acquired 100% equity shares of Kottaram Agro Foods Private Limited, owner of the brand âSoulfullâ with portfolio of millet-based products for adults and kids. In order to improve consumer traction, we have renamed the Company as âTata Consumer Soulfull Private Limitedâ and the brand to âTATA Soulfullâ. During the year, the revenue from operations declined as compared to previous year, however net loss from the business has reduced as compared to previous year due to reduction in cost of materials consumed and lower other expenses. The business acquisition was completed towards the end of the year under review and business integration and scale up plans are being put in place.

Associates

Amalgamated Plantations Private Limited (âAPPLâ), India

The total income for the year at Rs 830 Crores was higher by 18% driven by higher realisation partly offset by volume loss. The earnings before interest and tax and the profit after tax have improved due to improved operating performances. The total production for the year under review was lower than the previous year on account of the Covid pandemic and lock down at the start of the season, as also restrictions thereafter on reopening in terms of deployment of workers for plucking & processing. However, the prices for the CTC and orthodox teas were substantially higher in the year as compared to the previous year which has led to improved realization ( 45% growth). The drive by APPL to upgrade its quality across estates, was well received by all sections of the buyers and APPL firmly established itself as one of the âTop Quality Producersâ.

Kanan Devan Hills Plantations Company Private Limited (âKDHPâ), India - Total Income at Rs 430 Crores was higher than that of the previous year, registering a growth of 19% over previous year, mainly driven by higher volume and realisation. The profit after tax for the year was Rs 26 Crores, as against a loss of Rs 1 Crore in the previous year. Although the adverse effects of Covid pandemic and the unfavourable weather conditions with incessant rains that followed from August 2020 onwards, had affected production, the yield achieved for the year was the second highest since inception of KDHP.

Joint Ventures

Tata Starbucks Private Limited (âTSPLâ), India - our joint venture with Emerald City CV (Starbucks), was significantly impacted due to restrictions with continuation of Covid pandemic. TSPL crossed the 200^th store milestone and opened net 39 new stores in the current fiscal and are now present in 221 stores across 18 cities in India. TSPL have seen month-on-month improvement in metrics. While TSPL has ended the year with lower revenues than previous year, it has been able to lower the impact on profitability with help of cost initiatives like rent negotiations. TSPL was also recognized as Indiaâs top 10 workplaces in Retail, 2021.

For further analysis on the consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financial statements and Form no. AOC 1.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Appointments & Cessation of Directors

The members of the Company at the 57^th Annual General Meeting approved the appointment of Mr. Sunil DâSouza (DIN 07194259) as a Director, and also approved his appointment as the Managing Director & Chief Executive Officer of the Company for 5 years with effect from April 4, 2020, along with terms of appointment including remuneration.

Further, based on the recommendation of the Nomination and Remuneration Committee (NRC), the Board had appointed Mr. P. B. Balaji (DIN 02762983) as an Additional Director to hold office as Non-Executive (NonIndependent) Director on the Board of the Company with effect from August 8, 2020, till the conclusion of ensuing Annual General Meeting. A notice under Section 160 of the Act, has been received nominating the candidature of Mr. P. B. Balaji for appointment as a Director of the Company. The NRC and the Board have considered and recommend to the Shareholders for the appointment of Mr. P. B. Balaji as Non-Executive (Non-Independent) Director as set out in the Notice of AGM. A resolution seeking Shareholdersâ approval for his appointment forms

part of the Notice of the ensuing Annual General Meeting.

Mr. N. Chandrasekaran (DIN 00121863) Non-Executive, (Non-Independent) Director of the Company, retires by rotation and being eligible, offers himself for re-appointment. A resolution seeking Shareholdersâ approval for his re-appointment forms part of the Notice of the ensuing Annual General Meeting.

Mr. Harish Bhat (DIN 00478198), Non-Executive, (Non- Independent) Director of the Company has resigned and ceased to be a Director of the Company effective close of business hours of August 7, 2020. The Board places on record its appreciation for his invaluable contribution and guidance.

Key Managerial Personnel

As on March 31, 2021, the following were Key Managerial Personnel (âKMPâ) of the Company as per Sections 2(51) and 203 of the Act:

a) Mr. Sunil DâSouza, Managing Director & CEO,

b) Mr. L. Krishnakumar, Executive Director & Group CFO,

c) Mr. John Jacob, Chief Financial Officer and

d) Mr. Neelabja Chakrabarty, Company Secretary.

Pecuniary relationship or transactions with the Company

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 for the purpose of attending meetings of the Board/ Committee(s) of the Company.

BOARD OF DIRECTORS AND MEETINGS

The Board of Directors

The Board of the Company is comprised of eminent persons proven competence and integrity. Besides the experience, strong financial acumen, strategic astuteness, and leadership qualities, they have a significant degree of commitment towards the Company and devote adequate time to the meetings and preparation. In terms of requirement of Listing Regulations, the Board has identified core skills, expertise, and competencies of the Directors in the context of the Companyâs businesses for effective functioning, which are detailed in the Corporate Governance Report.

Committees of the Board

As required under the Act, and the Listing Regulations, the Company has constituted the following statutory committees:

1) Audit Committee

2) Nomination and Remuneration Committee

3) Stakeholders Relationship Committee

4) Risk Management Committee

5) Corporate Social Responsibility Committee

In addition to the above, the Board has formed an Executive Committee to review specific business operational matters and other items that the Board may decide to delegate.

Details of all the Committees such as terms of reference, composition and meetings held during the year under review are provided in the Report on Corporate Governance, a part of this Annual Report.

Board Meetings

The Board meets at regular intervals to discuss and decide on the Company/business policy and strategy apart from other Board business. The Board exhibits strong operational oversight with regular presentations in quarterly meetings. The Board / Committee meetings are pre-scheduled, and a tentative annual calendar of the Board and Committee meetings is circulated to the Directors well in advance to help them plan their schedule and ensure meaningful participation in the meetings. Only in case of special and urgent business, if the need arises, the Boardâs or Committeeâs approval is taken by passing resolutions through circulation or by calling the Board Committee meetings at short notice, as permitted by law.

The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed to enable the Directors to make an informed decision.

The Board of Directors had held 6 (six) meetings during FY 2020-21. For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Act and the Listing Regulations.

INDEPENDENT DIRECTORSâ DECLARATION

As on March 31, 2021, Mr. Bharat Puri, Mrs. Shikha Sharma, Mr. S. Santhanakrishnan, and Mr. Siraj Chaudhry were Independent Directors on the Board.

Pursuant to the provisions of Section 149 of the Act and Regulation 25 of the Listing Regulations, the Independent Directors of the Company have submitted declarations that each of them meets the criteria of independence as

provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of Listing Regulations. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

Further, declaration on compliance with Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended by Ministry of Corporate Affairs (âMCAâ) Notification dated October 22, 2019, regarding the requirement relating to enrollment in the Data Bank created by MCA for Independent Directors, had been received from all Independent Directors.

SELECTION AND PROCEDURE FOR NOMINATION AND APPOINTMENT OF DIRECTORS

The Nomination and Remuneration Committee (âNRCâ) of the Board entrusted with the responsibility for developing competency requirements for the Board, based on the industry and strategy of the Company. The Board composition analysis reflects an in-depth understanding of the Company, including its strategies, environment, operations, financial condition and compliance requirements.

The NRC makes recommendations to the Board regarding appointment/re-appointment of Directors, and Key Managerial Personnel (âKMPâ). The role of the NRC encompasses conducting a gap analysis to refresh the Board periodically, including each time a Directorâs appointment or re-appointment is required. The NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertake a reference and due diligence and meeting of potential candidates before making recommendations of their nomination to the Board. The appointee is also briefed about the specific requirements for the position including expert knowledge expected at the time of appointment.

The Remuneration Policy and the Policy on Nomination, Appointment and Removal of Directors of the Company are available at : https://www.tataconsumer.com/investors/ policies.

The Companyâs governance guidelines cover aspects mainly relating to composition and role of the Board, Chairman and Directors, Board diversity, and Committees of the Board. As per the Companyâs policy on retirement of Directors, the retirement age for Managing/Executive Directors is 65 years, Non-Executive (Non-Independent) Directors is 70 years, and Non-Executive, Independent Directors is 75 years.

Criteria for determining qualifications, positive attributes and independence of a director

In terms of the provisions of Section 178(3) of the Act and Regulation 19 of the Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors, the key features of which are as follows:

â¢ Positive Attributes - Apart from the duties of Directors as prescribed in the Act, the Directors are expected to demonstrate high standards of ethical behavior, communication skills, and independent judgment. The Directors are also expected to abide by the respective Code of Conduct as applicable to them.

â¢ Independence - A Director will be considered independent if he/she meets the criteria laid down in Section 149(6) of the Act, the Rules framed thereunder and Regulation 16(1)(b) of the Listing Regulations , as amended from time to time.

ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors has carried out an annual evaluation of its own performance, Board Committees, and individual Directors pursuant to the provisions of the Act and the Listing Regulations.

In a separate meeting of Independent Directors, the performance of Non-Independent Directors and the Board as a whole and the Chairman of the Company

was evaluated taking into account the views of Executive Directors and Non-Executive Directors.

The above evaluations were then discussed at the Board meeting that followed the meeting of the Independent Directors and the NRC, at which the performance of the Board, its Committees, and individual Directors was also discussed. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent director being evaluated.

REMUNERATION POLICY

The philosophy for remuneration is based on the commitment of fostering a culture of leadership with trust. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Act which is as under:

â¢ That the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the company successfully;

â¢ Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

â¢ Remuneration to Directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

The Remuneration Policy of the Company is available at: https://www.tataconsumer.com/investors/policies

The key principles governing the Remuneration Policy are as follows:

â¢ Market competitiveness;

â¢ Role played by the individual;

â¢ Reflective of the size of the company, complexity of the sector/ industry / Companyâs operations and the Companyâs capacity to pay;

â¢ Consistent with recognised best practices; and

â¢ Aligned to any regulatory requirements.

In accordance with the Policy, the Managing Director & CEO, Executive Director, KMPs, Senior Management and employees are paid fixed salary which includes basic

Further, in line with the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in I employment with any other Tata Company. Accordingly,

. no commission was paid to Mr. P. B. Balaji and : Mr. Harish Bhat, Non-Executive (Non-Independent) Directors.

FAMILIARISATION PROGRAMME FOR INDEPENDENT I DIRECTORS

Independent Directors play a pivotal role in upholding corporate governance norms and ensuring fairness in _, decision-making. Being experts in various fields, they also bring independent judgement on matters of strategy, risk management, controls and business performance.

At the time of appointing a new Independent Director, a formal letter of appointment is given to the Director, inter alia, explaining the role, duties and responsibilities of â the Director. The Director is also explained in detail the compliances required from him / her under the Act, SEBI Regulations and other relevant regulations.

By way of an introduction to the Company, presentations are also made to the newly appointed Independent Director on relevant information like an overview of the Companyâs businesses, market and business environment, growth and performance, organisational set up of the Company, governance and internal control processes.

Ongoing familiarisation aims to provide insights into the Company and the business environment to enable all the I Independent Directors to be updated on newer challenges, risks and opportunities relevant in the Companyâs context and to lend perspective to the strategic direction of the ^: Company.

^: Familiarisation programme for the Independent Directors along with the details of familiarisation programmes imparted to Independent Director during and cumulative ^, upto FY 2020-21 is placed on the Companyâs : website and the same can be accessed at the link :

: https://www.tataconsumer.com/investors/Board-Of-. Directors-List/familiarization-programme?reload t

BOARD DIVERSITY

i The Company recognizes and embraces the importance , of a diverse board in its success. The Company believes : that a truly diverse board will leverage differences in : thought, perspective, knowledge, skill, regional and industry c experience, cultural and geographical background, age, ethnicity, race and gender, which will help the Company to retain its competitive advantage. The Board has adopted the _; Board Diversity Policy (as a part of the Policy on Nomination, Appointment & Removal of Directors) which sets out the

salary, allowances, perquisites and other benefits and also annual incentive remuneration / performance-linked incentive subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time, by the NRC and the Board. The performance linked incentive is driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for Independent Directors and Non-Independent, Non-Executive Directors

The Non-Executive Directors, including Independent Directors, are paid sitting fees for attending the meetings of the Board and Committees of the Board. As per the policy, the overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, complexity of the business and the Companyâs capacity to pay the remuneration.

During the year under review, the Company paid sitting fee of Rs. 30,000 per meeting per Non-Executive Director for attending meetings of the Board, Audit, Nomination and Remuneration and Executive Committees (Rs. 20,000 in case of Non-Executive Director, being the employee of other Tata Companies). For meetings of all other Committees of the Board, sitting fee of Rs. 15,000 per meeting per Non-Executive Director was paid (Rs.10,000 in case of Non-Executive Director, being the employee of other Tata Companies). The Company also paid sitting fees of Rs. 30,000 per meeting per Independent Director for attending the Independent Directorsâ meeting. Within the ceiling as prescribed under the Act, the Non-Executive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and approved by the Board. The basis of determining the specific amount of commission payable to a NonExecutive Director is related to his attendance at meetings, role and responsibility as Chairman or Member of the Board / Committees and overall contribution as well as time spent on operational matters other than at the meetings. The Shareholders of the Company had approved payment of commission to the Non-Executive Directors at the Fifty-Fifth Annual General Meeting held on July 5, 2018 for each financial year to be distributed among the Directors in such manner as the Board of Directors may, from time to time, determine within the overall maximum limit of 1% (one percent) per annum of net profit or such other percentage as may be specified by the Act, from time to time. No Stock option has been granted to any Director.

As a policy, Mr. N. Chandrasekaran, Chairman, has abstained from receiving commission from the Company.

approach to the diversity of the Board of Directors. The Policy is available on the website of the Company at https://www. tataconsumer.com/investors/policies.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Board has adopted policies and procedures for the governance of orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures. The Companyâs internal control systems are commensurate with the nature of its business, the size and complexity of its operations.

Statutory Auditors in its report expressed an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial.

AUDIT COMMITTEE

The Committee has adopted a Charter for its functioning. The primary objective of the Committee is to monitor and provide effective supervision of the Managementâs financial reporting process, to ensure accurate and timely disclosures, with the highest levels of transparency, integrity and quality of financial reporting. The Committee comprises Mr. S. Santhanakrishnan (Chairman), Mr. Bharat Puri, Mrs. Shikha Sharma, Mr. Siraj Chaudhry and Mr. P. B. Balaji. The Committee met 8 times during the year under review, the details of which are given in the Corporate Governance Report.

During the year under review, there were no instances when the recommendations of the Audit Committee were not accepted by the Board.

INTEGRATED REPORT

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS

The Company has complied with the corporate governance requirements under the Act, and Listing Regulations. A separate section on Corporate Governance along with a certificate from the practicing Company Secretary confirming compliance forms an integral part of this Annual Report.

A detailed report on Management Discussion and Analysis forms an integral part of this Annual Report and also covers the consolidated operations reflecting the global nature of our business.

BUSINESS RESPONSIBILITY REPORT

In compliance with Regulation 34 of the Listing Regulations, a separate section on the Business Responsibility Report, describing the initiatives taken by the Company from an environmental, social and governance perspective, during the year under review, forms part of this Annual Report.

DIRECTORSâ 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 including the audit of internal financial controls over financial 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 Companyâs internal financial controls were adequate and operating effectively during the financial year 2020-21.

Pursuant to Section 134 (5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that for the financial year ended March 31, 2021:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

(iv) They have prepared the annual accounts on a âgoing concern basis;

(v) They have laid down internal financial controls for the Company which are adequate and are operating effectively;

(vi) They have devised a proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

CORPORATE SOCIAL RESPONSIBILITY (CSR) AND SUSTAINABILITY INITIATIVES

In compliance with Section 135 of the Act, the Company has undertaken CSR activities, projects and programs, excluding activities undertaken in pursuance of its normal course of business. The Natural Foods & Beverages Policy of the Company is the apex Sustainability Policy that defines the aspiration to be the consumerâs first choice in sustainable production and consumption. The sustainability pillars of the Company are Sustainable Sourcing, Climate Change, Water Management, Waste Management and Community Development.

During the year under review, the Company has spent Rs. 11.74 Crores (2.05%) of the average qualifying net profits of last three financial years) on CSR activities on projects qualifying as per Section 135 of the Act, duly approved by the CSR Committee of the Board. In addition to the projects specified as CSR activities under section 135 of the Act, the Company has also carried out several other sustainability / responsible business initiatives and projects on a global scale.

The salient features of the CSR Policy and details of activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 are provided in Annexure 1 attached to this Report. The revised CSR Policy may be accessed on the Companyâs website at the link: https://www.tataconsumer.com/investors/policies.

STATUTORY AUDITORS AND AUDITORSâ REPORT

At the 54^th Annual General Meeting held on August 18, 2017, the Shareholders had approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No.117366W/W-100018) as the Statutory Auditors for a period of 5 years commencing

from the conclusion of the 54^th Annual General Meeting

until the conclusion of the 59^th Annual General Meeting to be held in the year 2022, subject to ratification by the Shareholders every year, if so required under the law.

However, pursuant to the amendment to Section 139 of the Act, effective May 7, 2018, ratification by Shareholders

every year for the appointment of the Statutory Auditors is no longer required and accordingly, the Notice of ensuing Annual General Meeting does not include the proposal for seeking Shareholdersâ approval for ratification of Statutory Auditorsâ appointment.

Deloitte Haskins & Sells LLP has furnished a certificate of their eligibility and consent under section 139 and 141 of the Act and the Companies (Audit and Auditors) Rules 2014 for their continuance as the Auditors of the Company for the FY 2021-22. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI. Accordingly, Deloitte Haskins & Sells LLP continues to hold office as Auditors of the Company.

The Statutory Auditorsâ Report for FY 2020-21 on the financial statement of the Company forms part of this Annual Report. Auditors have expressed their unmodified opinion on the Standalone and Consolidated Financial Statements and their reports do not contain any qualifications, reservations or adverse remarks or disclaimer.

The Statutory Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Act, in the year under review.

SECRETARIAL AUDITORS AND AUDITORSâ REPORT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice (FCS No. 2303, Certificate of Practice No. 880), to carry out the Secretarial Audit of the Company. The Report of the Secretarial Auditor for FY 2020-21 is attached herewith as Annexure 2. There are no qualifications, observations or adverse remarks or disclaimer in the said report.

COST RECORDS AND COST AUDITORS

During the year under review, in accordance with Section 148(1) of the Act , the Company has maintained the accounts and cost records, as specified by the Central Government. Such cost accounts and records are subject to audit by M/s Shome and Banerjee, Cost Auditors of the Company for FY 2020-21.

The Board has re-appointed M/s Shome and Banerjee, Practicing Cost Accountants (Firm Registration Number: 000001) as Cost Auditors of the Company for conducting cost audit for the FY 2021-22. A resolution seeking approval of the Shareholders for ratifying the remuneration payable to the Cost Auditors for FY 2021-22 is provided in the Notice of the ensuing Annual General Meeting.

The Cost accounts and records as required to be maintained under section 148 (1) of the Act are duly made and maintained by the Company.

RISK MANAGEMENT

The Company has an elaborate risk charter and risk policy defining the risk management governance model, risk assessment and prioritization process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an update to the Board on the Companyâs risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls.

Additionally, a third- party organisation has benchmarked the Companyâs risk management practice with various companies in India and globally and pronounced it as a leader in FMCG category. The Company was consecutively for the second time declared as the winner in the category in âMaster of Risk in FMCG categoryâ, at the seventh edition of The India Risk Management Awards 2021 by CNBC TV-18 and ICICI Lombard. These awards recognize those organisations and teams that have significantly added to the understanding and practice of risk management.

VIGIL MECHANISM / WHISTLE-BLOWERPOLICY

The Companyâs vigil mechanism allows the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the code of conduct /business ethics as well as to report any instance of leak of Unpublished Price Sensitive Information. The vigil mechanism provides for adequate safeguards against victimisation of the Director(s) and employee(s) who avail this mechanism. No person has been denied access to the Chairman of the Audit Committee.

The Whistle-Blower Policy of the Company can be accessed on the Companyâs website at the link: https:// www.tataconsumer.com/investors/policies.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS BY THE COMPANY

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are provided in Annexure 3 attached to this report.

RELATED PARTY TRANSACTIONS

All Related Party Transactions (RPTs) entered into by the Company during the year under review were on an armsâ length basis and in the ordinary course of business. These RPTs did not attract provisions of Section 188 of the Companies Act, 2013 and were also not material RPTs under Regulation 23 of the Listing Regulations. Given that the Company does not have anything to report pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form No. AOC- 2, therefore the same is not provided. All related party transactions are approved by the Audit Committee and are periodically reported to the Audit Committee. Prior approval of the Audit Committee was obtained on a periodic basis for the transactions which were planned and / or repetitive in nature and omnibus approvals were also taken as per the policy laid down for unforeseen transactions.

The Policy on Related Party Transactions as approved by the Board of Directors is available on the Companyâs website and may be accessed at the link: https://www. tataconsumer.com/investors/policies.

The details of the transactions with related parties during FY 2020-21 are provided in the accompanying financial statements.

The transactions with person or entity belonging to the promoter/ promoter group which hold(s) 10% or more shareholding in the Company has been disclosed in the accompanying financial statements.

ANNUAL RETURN

As provided under Section 92(3) & 134(3)(a) of the Act, Annual Return for FY 2020-21 is uploaded on the website of the Company and can be accessed at https://www. tataconsumer.com/investors/investor-information/annual-returns?reload

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure 4 attached to this report.

Pursuant to Section 197(14) of the Act, the details of remuneration received by the Executive Director from the Companyâs subsidiary company during FY 2020- 21 are also given in Annexure 4 attached to this report.

The statements required under Section 197 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (âthe Rulesâ), as amended, form part of this report and will be made available to any Member on request, as prescribed therein.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

INDUSTRIAL RELATIONS

During the year under review, industrial relations remained harmonious at all our offices and establishments.

DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has complied with provisions relating to the constitution of the Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

There were no complaints relating to sexual harassment, pending at the beginning of financial year, received during the year and pending as on the end of the Financial Year 2020-21.

SECRETARIAL STANDARDS

DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from the public was outstanding as on March 31, 2021.

PARTICULARS OF ENERGY CONSERVATION,TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO [PURSUANT TO COMPANIES (ACCOUNTS) RULES, 2014]

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 5 attached to this report.

ACKNOWLEDGEMENT

The Directors thank the Government of India, Governments of various States in India, Governments of various Countries and concerned Government departments for their cooperation.

The Directors regret the loss of life due to Covid pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic.

The Directors appreciate and value the contribution made by every member of the Tata Consumer Products family.

On behalf of the Board of DirectorsSd/-N. Chandrasekaran Mumbai Chairman

May 6, 2021 (DIN 00121863)

Mar 31, 2019

To the Members of Tata Global Beverages Limited

The Directors are pleased to submit their Fifty-Sixth report together with the audited financial statements of the Company for the year ended March 31, 2019.

Financial Results

(Rs. in Crores)

Particulars	Consolidated		Standalone
Particulars	2018-19	2017-18	2018-19	2017-18
Revenue from Operations	7252	6815	3430	3217
Profit before exceptional items and taxes	768	774	576	608
Exceptional items (net)	(33)	(21)	-	115
Profit before tax	735	753	576	723
Provision for tax	(261)	(186)	165	189
Profit after tax	474	567	411	534
Share of net profit/(loss) in Associates and Joint Ventures	(17)	(10)	-	-
Profit for the year	457	557	411	534
Attributable to Owners of the parent	408	496	411	534
Retained Earnings - Opening Balance	5375	4396	2552	1577
Add: Profit for the year	408	496	411	534
Add: Adjustments with Other Equity including Other Comprehensive Income	67	687	3	638
Amount appropriated during the year:
Dividend including dividend tax paid	(179)	(173)	(182)	(169)
Transfer to General Reserves	(4)	(31)	-	(28)
Retained Earnings - Closing Balance	5667	5375	2784	2552

State of Companyâs Affairs Consolidated Performance

The Consolidated Revenue from operations at Rs. 7,252 Crores grew by 6% during FY 2018-19 (3% on constant currency basis). Excluding the impact of business exit, Revenue from operations grew by 8% (5% on constant currency basis). The increase in revenue is led by the growth in Indian tea brands, business model change for single serve K Cup coffee sales in the US and growth in Coffee Extractions business in Tata Coffee. Profit before exceptional items and tax at Rs. 768 Crores is marginally lower than the previous year mainly due to higher tea commodity costs in India and higher brand support costs partly offset by lower tea and coffee commodity costs in the International market. Profit for the year at Rs. 457 Crores is impacted mainly due to higher level of exceptional expenditure, higher tax expense in the current year and lower share of profits from Associates and Joint Ventures. In the previous year, the Company had the benefit of one-time tax credits arising on account of reduction in US rates due to changes in tax legislation.

Standalone Performance

The Standalone Revenue from operations at Rs. 3,430 Crores grew by 7 % during the year under review. Revenue growth was higher than FY 2017-18 with volume growth across all major brands. Profit before exceptional items and tax at Rs. 576 Crores is lower than previous year mainly on account of higher tea commodity costs and discretionary/one off items. Profit after tax at Rs. 411 Crores is lower than previous year mainly on account of exceptional profits on divestment of our stake in an associate in the previous year.

Dividend

Your Directors are pleased to recommend for the approval of the shareholders a dividend of Rs. 2.50 per share on the equity share capital of the Company for the year ended March 31, 2019. The total outgo on account of dividend inclusive of taxes, for FY 2018-19 is Rs. 190.21 Crores which represents a pay-out of 46% of the Companyâs standalone profits.

Pursuant to Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), the dividend distribution policy duly approved by the Board has been put up on the website of the Company and can be accessed at the link: http://www. tataglobalbeverages.com/docs/default-source/default-document-library/tgbl-dividend-policy.pdf?sfvrsn=0.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profits for FY 2018-19 in the profit and loss account.

Share Capital

The paid up Equity Share Capital as at March 31, 2019 was Rs. 63.11 Crores comprising of 63,11,29,729 equity shares of Re. 1 each. During FY 2018-19, your Company has neither issued any shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2019, none of the Directors or the Key Managerial Personnel of the Company holds instruments convertible into equity shares of the Company.

Integrated Report

This is the second year of implementation of Integrated Reporting by the Company in line with the Integrated Reporting framework developed by the International Integrated Reporting Council. This is being implemented in a phased manner.

Review of Subsidiaries, Associates and Joint Venture Companies

Pursuant to Section 129(3) of the Companies Act, 2013 (âActâ), the consolidated financial statements of the Company and its subsidiaries, associates and joint ventures, prepared in accordance with the relevant Accounting Standard specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, form part of this Annual Report.

Pursuant to the provisions of the said section, a statement containing the salient features of the financial statements of the Companyâs subsidiaries, associates and joint ventures in Form AOC-1 is given in this Annual Report. Further, pursuant to the provisions of Section 136 of the Act, the standalone financial statements of the Company, consolidated financial statements of the Company, and the relevant consolidated financial statements and separate audited financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company, in the link http://tataglobalbeverages.com/investors/financial-performance/ subsidiaries/subsidiary-financials

The details of material changes in the nature of the business of some of the subsidiaries (including associates and joint ventures) during FY 2018 -19 are given in the Management Discussion and Analysis (âMD&Aâ) attached. The impact of such changes, if any, has been adequately disclosed in the financial statements.

The Company has revised the policy for determining material subsidiaries in terms of Regulation 16(1)(c) of the Listing Regulations, as amended from time to time. The policy as approved may be accessed on the Companyâs website at the link http://www.tataglobalbeverages.com/docs/default-source/default-document-library/policy-on-material-subsidiary. pdf?sfvrsn=0.

Performance highlights of key operating subsidiaries, associates and joint ventures

Subsidiaries

Tata Global Beverages Group Ltd, UK (âTGBGâ), substantially reflects the financial performance of the Tetley business and a few other international brands. The topline, in underlying terms and excluding the impact of business exits, reported a marginal decline during FY 2018-19, which is reflective of decline in everyday black tea category and higher competitive intensity in some markets. The developed markets are faced with everyday black tea category decline, whilst on the other hand, strong growth is witnessed in non-black tea categories. UK, which is one of the largest market, reflected a steady growth in volume and profitability aided, among other things, by a soft commodity price environment. In Australia, the licensing agreement for single serve coffee pods using the MAP brand were changed to Kruger K Fee in the later part of the year. K Fee is the 2nd largest system in Australia and this change will further fuel our growth aspiration in coffee in that country. Profitability improved largely due to improvement in operating performance particularly in the UK, good control over costs, cost benefits arising out of past restructuring and lower level of exceptional expenditure.

TGBG, restructured the activities of some of its 100% step down subsidiaries. Accordingly, Tata Global Beverages Services Limited, Tata Global Beverages Investments Limited and Tata Global Beverages Holdings Limited transferred its net assets and activities to its holding company, i.e. TGBG/ fellow subsidiary, namely, Tata Global Beverages GB Ltd. The purpose of the restructure was to simplify the legal structure, reduce the number of step down subsidiaries and to reduce the ongoing administration burden. It is expected that in the absence of any future transactions, the restructured entities will cease to trade and plan to be dormant for the foreseeable future. As restructure was intra group and between 100% subsidiaries of TGBG, there is no impact of the restructure transactions on the consolidated financial statements.

Tata Coffee Limited (âTCLâ) ended FY 2018-19 on a better note compared to FY 2017-18 despite crop loss caused by extreme weather conditions. Operating Profit and Profit after tax was higher than previous year driven from improvement in performance of the Instant Coffee, strong focus on cost management and monetization of non-core assets whilst the plantation operations were impacted by abnormal and extreme weather conditions and lower pepper realisations.

The Instant Coffee business has recorded its second highest sales volume with key focus on customer acquisition in new geographies whilst the Freeze-Dried Coffee plant in India, which is a sub-segment of the Instant Coffee business, delivered the highest ever production and dispatches since inception.

TCLâs state-of-the-art Freeze Dried Instant Coffee plant in Vietnam, with an annual capacity of 5000MT, has been inaugurated and currently in the process of customer trials in the pilot plant. Freeze Dried coffee is a growing segment worldwide in the premium Instant Coffee space. This move is expected to further strengthen the Companyâs growth in the Coffee Extractions segment and further expand our global foot print.

Eight OâClock Coffee (âEOCâ) registered a good topline growth. While the business benefited from a softer commodity environment, operating profit was lower mainly due to higher spends behind brands and one-time costs associated with the new business model for single serve coffee pods. Profit after tax was lower than previous year as last year had the benefit of one-time tax credits arising on account of changes in US tax legislation reducing the tax rates.

Tata Tea Extractions Inc., the Companyâs subsidiary in the US had a good performance during the year with topline growth and higher profitability as compared to previous year.

Associates

Amalgamated Plantations Private Limited (âAPPLâ), India, reported a revenue growth of 3% due to higher realisations. However, APPL had incurred operating losses on account of wage revision, challenging plantation environment and onetime credits in the previous year.

Kanan Devan Hills Plantations Company Private Limited (âKDHPâ) reported a topline growth of 4% over the previous year. Despite the inclement weather conditions which prevailed during part of the year under review in Kerala, the yield achieved was the third highest since formation of KDHP. The operating profit was however impacted by floods which partially got offset by improved realisation and good cost management.

Joint Ventures

Tata Starbucks Private Limited, our joint venture with Starbucks, reflected a double digit topline growth ~30% due to growth in existing store sales coupled with expansion of stores. Tata Starbucks kept up the momentum on expanding the store base and added 30 new stores to reach 146 stores by the end of FY 2018-19. In FY 2018 19, it also marked the entry into a new city market - Chandigarh. The new stores were added across formats including (i) smaller footprint stores as we increased penetration in existing cities (e.g. Mumbai, Bangalore), (ii) new formats: Highway (Mumbai-Pune and Bangalore -Tirupati) and Shop in Shop (Westside, Bangalore) and (iii) high profile coffee forward stores (e.g. store in Vittal Mallya road in Bangalore).

NourishCo Beverages Limited, our Joint venture with PepsiCo in India, delivered growth on account of improved performances by Tata Gluco Plus (âTGPâ) and Tata Water Plus. TGP remains a star performer product with milestone sale achieved during the year. This year also marked our entry into Odisha market where we were able to replicate the successful business model established in Andhra Pradesh, Telengana and Tamil Nadu. The product is in the process of being rolled-out in West Bengal, Bihar, Jharkhand and Delhi.

Companies which have become or ceased to be Subsidiaries, Associates and Joint Ventures

During the FY 2018-19, there was no change in subsidiaries, associates and joint ventures.

For further analysis on the consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financial statements and Form AOC 1.

Industrial Relations

During the year under review, industrial relations remained harmonious at all our offices and establishments.

Corporate Governance and MD&A

The Company has complied with the Corporate Governance requirements under the Act and Listing Regulations. A separate section on Corporate Governance along with a certificate from the practicing Company Secretary confirming compliance is annexed and forms part of this report.

A detailed report on Management Discussion and Analysis forms an integral part of this report and also covers the consolidated operations reflecting the global nature of our business.

Vigil Mechanism / Whistle Blower Policy

The Companyâs vigil mechanism allows the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the code of conduct /business ethics. The vigil mechanism provides for adequate safeguards against victimisation of the Director(s) and employee(s) who avail this mechanism. All Directors and employees have access to the Chairman of the Audit Committee.

The Company has revised the Whistle-Blower policy to insert âreporting of incidents of leak or suspected leak of Unpublished Price Sensitive Information (UPSI)â in terms of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended from time to time and the revised policy was approved by the Audit Committee and the Board at its meetings held on March 19 and 27, 2019, respectively. The policy as approved may be accessed on the Companyâs website at the link: http:// www.tataglobalbeverages.com/docs/default-source/default-document-library/tgbl_-whistle-blower-policy.pdf?sfvrsn=0.

During the year under review, the Company, based on whistleblower complaint, has noticed certain instances of lapses in relation to sales promotion claims. The Company has promptly started investigating the matter and has also taken appropriate action against the involved employees, however these investigations have not been fully concluded as at the year end. There is no material impact of the above lapses on the financial statements.

Internal Financial Controls

The Board has adopted policies and procedures for governance of orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures. The Companyâs internal control systems commensurate with the nature of its business, the size and complexity of its operations.

These are detailed in the Management Discussion and Analysis Report.

Tata Business Excellence Model (âTBEMâ)

In pursuit of holistic improvement, the Company periodically participates in the TBEM Assessment process. The TBEM assessment for the Company took place between July and September 2018. The process, which covered several locations of the Company across the world, was led by a group of seasoned assessors from various Tata companies who provided an external perspective on the strengths and OFI (opportunities for improvement). There has been a steady improvement in the Companyâs score in this round of assessment. The assessment team has identified several best practices from the Company. A presentation was made to the Board on October 30, 2018. Going forward, the Company will be actioning the feedback leading to improvement in processes and related results. External Best Practices from other Tata companies are looked at for adoption. A series of initiatives that include workshops, working groups, cross functional teams and workstreams in identified areas are being planned. This will be a crucial step to further embed TBEM in the TGB ecosystem in the years to come.

Governance Guidelines

The Companyâs governance guidelines on Board effectiveness cover aspects relating to composition and role of the Board, Chairman and Directors, Board diversity, term of Directors, retirement age and committees of the Board.

The guidelines also cover key aspects relating to nomination, appointment, induction and development of Directors, Directors remuneration, oversight on subsidiary performances, code of conduct, Board effectiveness reviews and various mandates of Board committees. As per the Governance Guidelines adopted by the Board, the retirement age for Managing/Executive Directors is 65 years, Non-Executive (Non-Independent) Directors is 70 years and Non-Executive, Independent Directors is 75 years.

Selection and Procedure for Nomination and Appointment of Directors

The Company has a Nomination and Remuneration Committee (âNRCâ) which is responsible for developing competency requirements for the Board, based on the industry and strategy of the Company. The Board composition analysis reflects an in-depth understanding of the Company, including its strategies, environment, operations, financial condition and compliance requirements.

The NRC makes recommendations to the Board in regard to appointment of new Directors and Key Managerial Personnel (âKMPâ) and senior management. The role of the NRC encompasses conducting a gap analysis to refresh the Board on a periodic basis, including each time a Directorâs appointment or re-appointment is required. The NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertake a reference and due diligence and meeting of potential candidates prior to making recommendations of their nomination to the Board. The appointee is also briefed about the specific requirements for the position including expert knowledge expected at the time of appointment.

Criteria for determining qualifications, positive attributes and independence of a Director

In terms of the provisions of Section 178(3) of the Act, and Regulation 19 of the Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors, the key features of which are as follows:

- Qualifications - The Board nomination process encourages diversity of thought, experience, knowledge, age and gender. It also ensures that the Board has an appropriate blend of functional and industry expertise.

- Positive Attributes - Apart from the duties of Directors as prescribed in the Act the Directors are expected to demonstrate high standards of ethical behavior, communication skills and independent judgment. The Directors are also expected to abide by the respective Code of Conduct as applicable to them.

- Independence - A Director will be considered independent if he / she meets the criteria laid down in Section 149(6) of the Act, the Rules framed thereunder and Regulation 16(1)(b) of the Listing Regulations.

Annual Evaluation of the Board, its Committees and Individual Directors

The Board of Directors has carried out an annual evaluation of its own performance, Board Committees, and individual directors pursuant to the provisions of the Act and the Listing Regulations.

The Board evaluated its performance after seeking inputs from all the directors on the basis of criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, 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 above criteria are as provided by the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India.

The Chairman of the Board had one-on-one meetings with the Independent Directors and the Chairman of NRC had one-on-one meetings with the Executive and Non-Executive, Non-Independent Directors. These meetings were intended to obtain Directorsâ inputs on effectiveness of the Board/ Committee processes.

The Board and the NRC reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

In a separate meeting of independent directors, performance of non-independent directors and the board as a whole was evaluated. The Independent Directors in the said meeting also evaluated the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the Board to effectively and reasonably perform their duties. Additionally, the Chairman of the Board was also evaluated on key aspects of his role, taking into account the views of executive directors and non-executive directors in the aforesaid meeting. The above evaluations were then discussed in the board meeting that followed the meeting of the independent directors and NRC, at which the performance of the board, its committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

Remuneration Policy

Pursuant to the provisions of Section 178(3) of the Act, and Regulation 19 of the Listing Regulations, the NRC has formulated a policy relating to the remuneration for the Directors, Key Managerial Personnel (KMP), Senior Management and other employees. The philosophy for remuneration is based on the commitment of fostering a culture of leadership with trust. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Act which are as under:

- That the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the company successfully;

- Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

- Remuneration to Directors, KMP and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

The key principles governing the Remuneration Policy are as follows:

- Market competitiveness;

- Role played by the individual;

- Reflective of size of the company, complexity of the sector/ industry / Companyâs operations and the Companyâs capacity to pay;

- Consistent with recognised best practices; and

- Aligned to any regulatory requirements.

In accordance with the policy, the Managing Director, Executive Director, KMPs, Senior Management and employees are paid basic salary, fixed salary, benefits, perquisites, allowances and annual incentive remuneration / performance linked bonus subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. The performance linked bonus would be driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for Independent Directors and Non-Executive-Non-Independent Directors

The Non-Executive Directors, including Independent Directors, are paid sitting fees for attending the meetings of the Board and committees of the Board. As per the Policy, the overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, complexity of the business and the Companyâs capacity to pay the remuneration.

The Company pays a sitting fee of Rs. 30,000 per meeting per Director for attending meetings of the Board, Audit, Nomination and Remuneration and Executive Committees (Rs.20,000 in case of Mr. N. Chandrasekaran, Chairman and Mr. Harish Bhat, Director, being employees of other Tata companies). For meetings of all other committees of the Board, a sitting fee of Rs. 15,000 per meeting per Director is paid (Rs.10,000 in case of Mr. N. Chandrasekaran, Chairman and Mr. Harish Bhat, Non-Executive Director, being employees of other Tata companies). Within the ceiling of 1% of net profits of the Company, computed under the applicable provisions of the Act the Non-Executive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and approved by the Board.

The basis of determining the specific amount of commission payable to a Non-Executive Director is related to his attendance at meetings, role and responsibility as Chairman or member of the Board / Committees and overall contribution as well as time spent on operational matters other than at the meetings. The shareholders of the Company had approved payment of commission to the Non-Executive Directors at the last Annual General Meeting held on July 5, 2018 for each financial year to be distributed among the Directors in such manner as the Board of Directors may, from time to time, determine within the overall maximum limit of 1% (one percent) per annum or such other percentage as may be specified by the Act, from time to time. No Stock option has been granted to the Non-Executive Directors. As a policy, Mr. N. Chandrasekaran, Chairman, has abstained from receiving commission from the Company. Further, in line with the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in full time employment with any other Tata Company. Accordingly, no commission is paid to Mr. N. Chandrasekaran, Chairman and Mr. Harish Bhat, NonExecutive (Non-Independent) Director.

Board of Directors and meetings

The members of the Companyâs Board of Directors are eminent persons of proven competence and integrity. Besides experience, strong financial acumen, strategic astuteness and leadership qualities, they have a significant degree of commitment towards the Company and devote adequate time to the meetings and preparation.

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business. The Board exhibits strong operational oversight with regular presentations in every quarterly meetings. The Board / committee meetings are pre-scheduled and a tentative annual calendar of the Board and Committee meetings is circulated to the Directors well in advance to help them plan their schedule and ensure meaningful participation in the meetings. Only in case of special and urgent business, if the need arises, the Boardâs/Committeeâs approval is taken by passing resolutions through circulation or by calling Board/Board Committee meetings at short notice, as permitted by law.

The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board meetings and Annual General Meetings.

The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed to enable the Directors to take an informed decision.

The Board of Directors had held seven meetings during FY 2018-19. For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Act and the Listing Regulations.

Directors and Key Managerial Personnel (KMP)

The members in the last Annual General Meeting held on July 5, 2018 have appointed Mr. S Santhanakrishnan as an Independent Director for a period of 5 years i.e. from May 11, 2018 to May 10, 2023 and have re-appointed Mr. L. KrishnaKumar as an Executive Director for a period of five years i.e. from April 1, 2018 to March 31, 2023. Mr. Siraj Azmat Chaudhry was appointed as Independent Director at the Annual General Meeting of the Company held on August 18, 2017 for a period of 5 years i.e. from July 3, 2017 to July 2, 2022.

Mrs. Ireena Vittal (Independent Director) resigned from the Board with effect from June 30, 2018, due to personal reasons. The Board placed on record its appreciation for the valuable services rendered by Mrs. Ireena Vittal during her tenure as Director of the Company.

The Independent Directors on the Board of the Company namely Mr. V. Leeladhar, Mrs. Ranjana Kumar, and Mrs. Mallika Srinivasan were appointed at the Annual General Meeting of the Company held on August 26, 2014 for a period of 5 years and thus they are holding their respective offices till August 25, 2019. The Board placed on record its appreciation for the valuable services rendered by Mr. V. Leeladhar, Mrs. Ranjana Kumar, and Mrs. Mallika Srinivasan during their respective tenure as Director of the Company.

Mr. N. Chandrasekaran retires by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for re-appointment.

Mr. Ajoy Misra was appointed as Managing Director for a period of five years in 2014 which ended on March 31, 2019 and is eligible for reappointment. Mr. Misra, however, had approached the Nomination and Remuneration Committee for an early retirement from his role and bearing in mind the above request as well as the time required for smooth succession planning, the Board at their meeting held on March 27, 2019, based on the recommendation of the Nomination and Remuneration Committee approved the re-appointment of Mr. Ajoy Misra for a further period of one year i.e. from April 1, 2019 to March 31, 2020, subject to the approval of the shareholders. The approval of the shareholders relating to Mr. Ajoy Misraâs re-appointment and remuneration is being sought at the forthcoming Annual General Meeting.

During the year under review, Mr. V. Madan ceased to be Company Secretary w.e.f. August 6, 2018 consequent upon his retirement from the Company and Mr. Neelabja Chakrabarty was appointed as Company Secretary w.e.f. August 7, 2018.

Pursuant to the provisions of Section 203 of the Act, the KMPâs of the Company as on March 31, 2019 are; Mr. Ajoy Misra, Managing Director & CEO, Mr. L. KrishnaKumar, Executive Director, Mr. John Jacob, Chief Financial officer and Mr. Neelabja Chakrabarty, Company Secretary.

Apart from the above, no other Director or KMP were appointed or had retired or resigned during FY 2018-19.

Brief particulars and expertise of directors seeking reappointment together with their other directorships and committee memberships have been given in the annexure to the notice of the Annual General Meeting in accordance with the requirements of the Listing Regulations and Secretarial Standards.

Independent Directorsâ Declaration

Our definition of âIndependenceâ of Directors is derived from Regulation 16(1)(b) of the Listing Regulations and Section 149(6) of the Act and rules framed thereunder. The Independent Directors have also submitted a declaration that they meet the criteria of independence and 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 judgment and without any external influence, pursuant to Regulation 25 of the Listing Regulations.

Based on the confirmation / disclosures received from the Directors, the following Non-Executive Directors are Independent as on March 31, 2019:

1) Mr. V. Leeladhar

2) Mrs. Ranjana Kumar

3) Mrs. Mallika Srinivasan

4) Mr. S. Santhanakrishnan

5) Mr. Siraj Azmat Chaudhry

Committees of the Board

The Company has nine Board Committees as on March 31, 2019:

1) Audit Committee

2) Nomination and Remuneration Committee

3) Stakeholders Relationship Committee

4) Risk Management Committee

5) Corporate Social Responsibility Committee

6) Executive Committee

7) Ethics and Compliance Committee

8) M&A and Divestiture Committee

9) Committee for Special Projects

Details of all the committees along with their main terms, composition and meetings held during the year under review are provided in the Report on Corporate Governance, a part of this Annual Report.

Familiarisation programme for Independent Directors

As trustees of shareholders, independent directors play a pivotal role in upholding corporate governance norms and ensuring fairness in decision making. Being experts in various fields, they also bring independent judgement on matters of strategy, risk management, controls and business performance.

At the time of appointing a new Independent Director, a formal letter of appointment is given to the Director, inter alia, explaining the role, duties and responsibilities of the Director. The Director is also explained in detail the compliances required from him / her under the Act, SEBI Regulations and other relevant regulations.

By way of an introduction to the Company, presentations are also made to the newly appointed Independent Director on relevant information like overview of the Companyâs businesses, market and business environment, growth and performance, organisational set up of the Company, governance and internal control processes.

Ongoing familiarisation program aims to provide insights into the Company and the business environment to enable all the Independent Directors to be updated of newer challenges, risks and opportunities relevant in the Companyâs context and to lend perspective to the strategic direction of the Company.

The details for familiarisation program for the Independent Directors are put up on the website of the Company. As required under Regulation 46(2)(i) of the Listing Regulations, the details of familiarisation programmes conducted during FY 2018-19 is also put on the Companyâs website and the same can be accessed at the link : http://www.tataglobalbeverages. com/docs/default-source/default-document-library/ familiarisation-programme-for-independent-directors. pdf?sfvrsn=0.

Board Diversity

The Company recognizes and embraces the importance of a diverse board in its success. The Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help the Company to retain its competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors.

Significant and material orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

Corporate Social Responsibility (âCSRâ) and Sustainability initiatives

In compliance with Section 135 of the Act, the Company has undertaken CSR activities, projects and programs as provided in the CSR policy of the Company and as identified under Schedule VII to the Act and excluding activities undertaken in pursuance of its normal course of business. The Natural Beverages Policy of Tata Global Beverages is the apex Sustainability Policy that defines the aspiration to be the consumerâs first choice in sustainable beverage production and consumption. The sustainability pillars of the Company are Sustainable Sourcing, Climate Change, Water Management, Waste Management and Community Development.

The Company aims to support development programs for a million people in its supply chain by 2022. It aspires to create sustainability leadership in its beverages production units through focus on zero waste to landfill, use of renewable energy and rain water harvesting. All packaging centers globally have focused on zero waste to landfill target in 201819. The Eaglescliffe factory utilises about 39% of its electricity requirement from a 4.6MW solar farm at a nearby location.

The Company has also installed solar photovoltaic plants at its Water factory in Dhaula Kuan and Sampla Packeting Centre in India that account for about 25% of the energy used in those factories. Himalayan water for the USA market is CarbonNeutralÂ® certified product by Natural Capital Partners. Through Project Jalodari, the Company supports the right to water for everyone i.e. âto sufficient, safe, acceptable, physically accessible and affordable water for personal and domestic uses.â Under the Plastic Waste Management Rules, 2016 and amended in 2018, in India, EPR (Extended Producer Responsibility) Plan has been framed by your Company for collection and reprocessing of plastic packaging waste on a brand neutral basis across key markets. In October 2018, the Company joined the UK Plastics Pact - a collaborative initiative between UK businesses and stakeholders across the plastics value, to embed a circular economy for plastics in the UK by 2025. During the year under review, the Company spent Rs. 8.09 Crores (2.11% of the average qualifying net profits of last three financial years) on CSR activities on projects qualifying as per Section 135 of the Act, duly approved by the CSR Committee. In addition to the projects specified as CSR activities under Section 135 of Act, the Company has also carried out several other sustainability / responsible business initiatives and projects on a global scale. Salient features of the CSR Policy and details of activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is provided in Annexure 1 forming part of this Report. The CSR Policy may be accessed on the Companyâs website at the link: http://tataglobalbeverages.com/docs/default-source/ default-document-library/corporate-social-responsibility-policy 7214b6881a2368caa65dff02001c5be1.pdf?sfvrsn=0.

Particulars of Employees

The information as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure 2 which forms part of this report.

Pursuant to Section 197(14) of the Act, the details of remuneration received by the Managing Director and the Executive Director from the Companyâs subsidiary company during FY 2018-19 are also given in Annexure 2 attached to this report.

The information required under Rule 5(2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in an Annexure forming part of this Report. In terms of the first provision to Section 136 of the Act, the Report and Accounts are being sent to the Members excluding the aforesaid Annexure. Any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company. None of the employees listed in the said Annexure are related to any Director of the Company.

Particulars of Loans, Guarantees and Investments by the Company

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are provided in Annexure 3 attached to this report.

Risk Management

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement, and monitor the risk management plan for the Company. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Company has an elaborate Risk Charter and Risk policy defining risk management governance model, risk assessment and prioritisation process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an oversight to the Board on Companyâs risks outlined in the risk registers.

The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified are addressed through mitigating actions.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has adopted zero tolerance for sexual harassment at workplace and has formulated a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder for prevention and redressal of complaints of sexual harassment at workplace. Awareness programs were conducted at various locations of the Company.

The Company has complied with provisions relating to the constitution of Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the year under review, the Company received one complaint of sexual harassment and the same was resolved. There was no complaint pending as on March 31, 2019.

Deposits from public

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from public was outstanding as on March 31, 2019.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice, to carry out the Secretarial Audit of the Company. The Report of the Secretarial Audit for FY 2018-19 is attached herewith as Annexure 4. There are no qualifications, observations or adverse remark or disclaimer in the said report.

Business Responsibility Report (âBRRâ)

The Listing Regulations mandate the inclusion of the BRR as part of the Annual Report for top 500 listed companies based on market capitalisation. In compliance with the Listing Regulations, the Company has integrated BRR disclosures into the Annual Report.

Extract of Annual Return

As provided under Section 92 of the Act and rules framed thereunder, the extract of annual return in Form MGT-9 is given in Annexure 5 which forms part of this report.

In compliance with section 134(3)(a) of the Act, MGT 9 is uploaded on Companies website and can be accessed at http://www.tataglobalbeverages.com/investors/investor-information/mgt-9

Directorsâ 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 including audit of internal financial controls over financial 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 Companyâs internal financial controls were adequate and operating effectively during the FY 2018-19.

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm:

(i) That in the preparation of the accounts for the financial year ended March 31, 2019, the applicable accounting standards have been followed and that there are no material departures;

(ii) That the Directors have selected such accounting policies and applied them consistently and made judgments 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 profits of the Company for that period;

(iii) That the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That they have prepared the accounts for the financial year ended March 31, 2019 on a âgoing concern basis;

(v) That the Directors have laid down internal financial controls for the Company which are adequate and are operating effectively;

(vi) That the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

Related Party Transactions

All related party transactions that were entered into during the financial year 2018-19, were on an armâs length basis and in the ordinary course of business. There are no material related party transactions made by the Company during the year that required shareholdersâ approval under Regulation 23(4) of the Listing Regulations or Section 188 of the Act. All related party transactions are reported to the Audit Committee. Prior approval of the Audit Committee is obtained on a yearly basis for the transactions which are planned and / or repetitive in nature and omnibus approvals are taken as per the policy laid down for unforeseen transactions. Given that the company does not have any thing to report pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 , therefore the same is not provided. The policy on Related Party Transactions as amended in line with the amendments issued by Securities and Exchange Board of India (SEBI) notified SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018 (Amendment Regulations) on May 9, 2018 and as approved by the Board of Directors is available on the Companyâs website and may be accessed at the link: http://www.tataglobalbeverages.com/docs/default-source/ default-document-library/policy-on-related-party-transactions. pdf?sfvrsn=0.

The details of the transactions with related parties during FY 2018-19 are provided in the accompanying financial statements.

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, as applicable.

Transaction with person or entity belonging to the promoter/ promoter group which hold(s) 10% or more shareholding in the Company have been disclosed in the accompanying financial statements.

Statutory Auditors and Auditorsâ Report

At the 54th Annual General Meeting held on August 18, 2017, the shareholders had approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No.117366W/W-100018) as the Statutory Auditors for a period of 5 years commencing from the conclusion of the 54th Annual General Meeting until the conclusion of the 59th Annual General Meeting to be held in the year 2022, subject to ratification by the shareholders every year, if so required under law. Pursuant to the recent amendment to Section 139 of the Act effective May 7, 2018, ratification by Shareholders every year for the appointment of the Statutory Auditors is no longer required and accordingly the Notice of ensuing Annual General Meeting does not include the proposal for seeking Shareholders approval for ratification of Statutory Auditors appointment.

M/s. Deloitte Haskins & Sells LLP has furnished a certificate of their eligibility and consent under Section 139 and 141 of the Act and the Companies (Audit and Auditors) Rules 2014 for their continuance as the Auditors of the Company for the FY 2019-20. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.

The Statutory Auditorsâ Report for FY 2018-19 on the financial statement of the Company forms part of this Annual Report.

The Statutory Auditorsâ report on the financial statements for FY 2018-19 does not contain any qualifications, reservations or adverse remarks or disclaimer.

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso to Section 143(12) of the Act.

Cost Auditors

Your Board has appointed Shome and Banerjee, 5A Nurulla Doctor Lane, 2nd Floor, Kolkata - 700 017 as Cost Auditors of the Company for conducting cost audit for the FY 2019-20. A resolution seeking approval of the members for ratifying the remuneration payable to the Cost Auditors for FY 2019-20 is provided in the Notice to the ensuing Annual General Meeting.

Cost Records

The Cost accounts and records as required to be maintained under Section 148 (1) of Act are duly made and maintained by the Company.

Disclosure Requirements

Appreciation

The Directors also thank the Government of India, Governments of various states in India, Governments of various countries and concerned Government departments for their cooperation.

On behalf of the Board of Directors

N Chandrasekaran

Mumbai Chairman

April 23, 2019 (DIN 00121863)

Mar 31, 2018

Board''s Report

To the Members of Tata Global Beverages Limited

The Directors are pleased to submit their fifty fifth report together with the audited financial statements of the Company for the year ended 31^st March, 2018.

Financial Results

Rs. in Crores

Particulars	Consolidated		Standalone
	2017-18	2016-17	2017-18	2016-17
Revenue from Operations	6,815	6,780	3,217	3,064
Profit from Operations before Other Income, Finance Costs, Depreciation and Exceptional items	839	791	501	363
Less : Depreciation	(116)	(126)	(27)	(24)
Add: Other Income (Standalone results include intra-group dividends which are eliminated on consolidation)	94	83	148	96
Less : Finance Costs	(43)	(91)	(14)	(49)
Profit before exceptional items and taxes	774	657	608	386
Exceptional items (net)	(21)	5	115	-
Profit before tax	753	662	723	386
Provision for tax	(186)	(198)	(189)	(110)
Profit after tax	567	464	534	276
Share of net profit/(loss) in Associates and Joint Ventures	(10)	(9)	-	-
Profit for the year	557	455	534	276
Attributable to:
Owners of the parent	496	390	534	276
Non-Controlling Interest	61	65	-	-
Retained Earnings - Opening Balance	4,396	4,102	1,577	1,406
Add: Profit for the year	496	390	534	276
Add: Transfer from Debenture Redemption Reserve	-	81	-	81
Add: Realised gains on sale of equity shares carried at fair value through OCI	626	-	625	-
Add: Adjustments with Other Equity	61	3	13	(18)
Amount appropriated during the year:
Dividend including dividend tax paid	(173)	(167)	(169)	(168)
Transfer to General Reserves	(31)	(13)	(28)	-
Retained Earnings - Closing Balance	5,375	4,396	2,552	1,577

State of Company''s Affairs

Consolidated Performance

The Consolidated Revenue from operations at Rs. 6,815 Crores grew by 1% during FY 2017-18. However, excluding the impact of sale and restructuring of Group businesses, the increase is 2% in constant currency. Improved performances were recorded mainly in the branded business. Non- branded business had a challenging year mainly due to abnormal and extreme weather conditions. Profit before exceptional items at Rs. 774 Crores was higher by 18% as compared to the previous year despite the adverse non-branded performance, driven by improved operating performance by the branded business, good cost management, restructuring benefits and lower finance costs . Post the impact of exceptional items, tax and share of profits of joint ventures and associates, the profit for the year 2017-18 at Rs. 557 Crores grew by 22%.

Standalone Performance

The standalone revenue from operations for FY 2017-18 at Rs. 3,217 Crores increased by 5% over the previous year. Revenue increase has been witnessed due to volume growth across all the major brands within our national and regional portfolio. Profit before tax at Rs. 723 Crores reflected a robust growth of 87% over previous year mainly due to improved operating performance, good cost management, non-recurring items, higher investment income including dividend from subsidiaries and profit on sale of our stake held in an associate/subsidiary.

We had a smooth transition into the GST era with the rates on most of our products being in line with the erstwhile regime. Our operation and supply chain models have been restructured wherever necessary to make it efficient and compliant to the GST requirements.

Dividend

Your Directors are pleased to recommend for the approval of the shareholders a higher dividend of Rs. 2.50 per share on the equity share capital of the Company for the year ended 31^st March, 2018. The total outgo on account of dividend inclusive of taxes, for FY 2017-18 will be Rs. 190.21 Crores which represents a pay-out of 36% of the Company''s standalone profits. On a consolidated basis, the payout represents 38%.

Pursuant to Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the dividend distribution policy duly approved by the Board has been put up on the website of the Company and can be accessed at the link: http://tataglobalbeverages.com/ investors/governance/policies

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profits for FY 2017-18 in the profit and loss account. During FY 2017-18, the Company had transferred an amount of Rs. 27.60 Crores to the General Reserves, which was approved for transfer out of the profit of FY 2016-17.

Share Capital

The paid up Equity Share Capital as at 31^st March, 2018 was Rs. 63.11 Crores comprising of 63,11,29,729 equity shares of Re. 1 each. During FY 2017-18, your Company has not issued any shares including shares with differential voting rights nor has granted any stock options or sweat equity. As at 31^st March, 2018, none of the Directors of the Company hold instruments convertible into equity shares of the Company.

Integrated Report

Your Company has embarked on a journey towards voluntarily adopting the Integrated Reporting framework developed by the International Integrated Reporting Council. This is being implemented in a phased manner.

Review of Subsidiaries, Associates and Joint Venture Companies

Pursuant to Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company and its subsidiaries, associates and joint ventures, prepared in accordance with the relevant Accounting Standards specified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, form part of this Annual Report. Pursuant to the provisions of the said section, a statement containing the salient features of the financial statements of the Company''s subsidiaries, associates and joint ventures in Form AOC-1 is given in this Annual Report. Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the standalone financial statements, consolidated financial statements and the relevant consolidated financial statements and separate audited financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company, www.tataglobalbeverages.com.

Your Company has adopted a policy for determining material subsidiaries in terms of Regulation 16(1)(c) of the Listing Regulations. The policy as approved may be accessed on the Company''s website at the link: http://tataglobalbeverages.com/ investors/governance/policies

Performance highlights of key operating subsidiaries, associates and joint ventures Subsidiaries

Tata Global Beverages Group Ltd, UK substantially reflects the financial performance of the Tetley business and a few other international brands. Excluding the impact of acquisition and disinvestment, the minor decline in the consolidated revenue during FY 2017-18 is reflective of a strong sterling with adverse translation impact and higher competitive intensity in some markets. The markets are generally characterized by high competitive intensity, decline in every day black but with strong growth in specialty categories. During the year, the Company benefited from the full year impact of conversion of an overseas joint venture to a subsidiary and restructuring of its Russia operations. Profit before tax and exceptional items improved, despite BREXIT driven by higher commodity cost, largely due to good control over costs and benefits of restructuring of the operations. Profit after tax however was impacted mainly due to one-time non-recurring restructuring costs and one-time credits in the previous year relating to conversion of an overseas joint venture to a subsidiary. The Company has in principle approved restructuring of certain operations relating to its business in Eastern Europe.

Tata Coffee Limited had a difficult year with performance lower than the previous year in both the plantation and extraction businesses. The company''s plantation operations were impacted by crop loss due to abnormal and extreme weather conditions and lower terminal prices for Robusta Coffee whilst the coffee extraction operations were impacted due to lower sales.

Out of the various awards and recognitions which Tata Coffee has received during the year, it is noteworthy that in the second edition of the Ernesto Illy International Coffee Award in New York for the Year 2017, Nullore and Coovercolly Estates have received the award for their excellence in quality. Nullore Estate in Coorg is best known for its ''The Tata Nullore Estate microlot'' - the first Indian microlot to be featured last year in Starbucks Reserve stores in Seattle, USA.

The Board of Tata Coffee Limited have recommended a dividend of Rs. 1.50 per share (face value of Re. 1 per share) for the year ended 31^st March, 2018.

Eight O''Clock Coffee (EOC) registered a good performance with topline growth mainly in pods and private label sales. During the year, the company negotiated and renewed its contract with Keurig resulting in EOC having the benefit of direct sales of pods in most of the channels in which it operates and consequently the margins as opposed to a royalty agreement which was prevailing earlier. Profit before tax and exceptional item was impacted mainly due to higher Arabica Coffee commodity costs partially offset by savings due to internal restructuring, lower spends and margin improvement on the renewed Keurig contract. Profit after tax was significantly ahead of the previous year mainly due to a lower tax incidence on account of the benefit of reduction in the US tax rates.

Tata Tea Extractions Inc., the Company''s subsidiary in the US had a stable performance during the year.

Associates

Amalgamated Plantations Private Limited (APPL), India, reported higher revenue of 5% with improvements in sales from both own and purchased crops further enhanced with a higher orthodox mix to drive higher realizations. Improvement in price realizations was visible over the entire tea portfolio riding on quality improvements across many estates. Operating losses were reduced due to higher realization and good control over expenses despite increase in wages.

Kanan Devan Hills Plantations Company Private Limited reported a top line growth of 7% over the previous year. The production for the year was the second highest ever since the formation of the company with an all-time record yield. The company also improved its realizations despite depressed tea auction prices in South India due to improved product mix. However, profit before and after tax was impacted because of higher wage cost which has been partially offset by improved realizations and good cost management.

Joint Ventures

Tata Starbucks Private Limited, our joint venture with Starbucks has been recognized as one of the Top Ten India''s Best Workplaces in Retail in FY 2017-18. During the year, Tata Starbucks celebrated the opening of its 100^th store located in Mumbai and its five-year anniversary in India with a series of strategic initiatives that reaffirm its long-term commitment to the market. During the year, the business also entered Kolkata in West Bengal and has opened 3 stores till date in the city. The Company''s sales increased by 28% driven by better in store performance coupled with new stores added during the year. For the first time since inception, the company recorded a positive EBITDA.

Nourish Co Beverages Limited, our joint venture with PepsiCo, reported an increase of 8% in sales driven by growth across its portfolio i.e. Tata Gluco Plus, Tata Water Plus and Himalayan mineral water. The growth has been aided by achieving improved volume through distribution expansion. For the first time since inception, the Company is close to breakeven levels due to improved sales and structural improvements to the cost base by reducing logistics and manufacturing costs.

Companies which have become or ceased to be Subsidiaries, Associates and Joint Ventures

The following are the changes in subsidiaries, associates and joint ventures during FY 2017-18:

- Zhejiang Tata Tea Extractions Company Limited, China ceased to be a subsidiary consequent to sale of stake

- Sunty LLC and Tea Trade LLC ceased to be subsidiaries and Coffee Trade LLC became a subsidiary consequent to the restructuring of our Russian business

- Estate Management Services Private Limited, Sri Lanka ceased to be an Associate consequent to sale of stake

There were no other changes during FY 2017-18.

For further analysis on the consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financial statements and Form AOC 1.

Human Resources and Industrial Relations

During the year under review, industrial relations remained harmonious at all our offices and establishments.

Corporate Governance and MD&A

A detailed report on Corporate Governance, which forms part of this Annual Report is provided separately. The Management Discussion and Analysis (MD&A) forms an integral part of this report and also covers the consolidated operations reflecting the global nature of our business.

Vigil Mechanism / Whistle Blower Policy

The Company''s vigil mechanism allows the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the code of conduct /business ethics. The vigil mechanism provides for adequate safeguards against victimization of the Director(s) and employee(s) who avail this mechanism. All Directors and employees have access to the Chairman of the Audit Committee. The said policy is available on the website of the Company at www.tataglobalbeverages.com

Internal Financial Controls

The Company has adequate and robust systems for Internal Financial Controls which includes operational controls and internal financial controls over financial reporting. These are detailed in the MD&A.

Governance Guidelines

Selection and Procedure for Nomination and Appointment of Directors

The Company has a Nomination and Remuneration Committee (NRC) which 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 NRC makes recommendations to the Board in regard to appointment of new Directors. The role of the NRC encompasses conducting a gap analysis to refresh the Board on a periodic basis, including each time a Director''s appointment or re-appointment is required. The NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertake a reference and due diligence and meeting of potential candidates prior to making recommendations of their nomination to the Board. The appointee is also briefed about the specific requirements for the position including expert knowledge expected at the time of appointment.

Criteria for determining qualifications, positive attributes and independence of a Director

In terms of the provisions of Section 178(3) of the Companies Act, 2013 and Regulation 19 of the Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors, the key features of which are as follows:

- Qualifications - The Board nomination process encourages diversity of thought, experience, knowledge, age and gender.

It also ensures that the Board has an appropriate blend of functional and industry expertise.

- Positive Attributes - Apart from the duties of Directors as prescribed in the Companies Act, 2013, the Directors are expected to demonstrate high standards of ethical behavior, communication skills and independent judgment. The Directors are also expected to abide by the respective Code of Conduct as applicable to them.

- Independence - A Director will be considered independent if he / she meets the criteria laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

Annual Evaluation of the Board, its Committees and Individual Directors

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Companies Act, 2013, Listing Regulations and the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, 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.

In a separate meeting of independent directors, performance of non-independent directors, the Chairman of the Company and the board as a whole was evaluated, taking into account the views of executive directors and non-executive directors.

The NRC and the Board reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In the board meeting that followed the meeting of the independent directors and meeting of NRC, the performance of the board, its committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

Remuneration Policy

Pursuant to the provisions of Section 178(3) of the Companies Act, 2013, and Regulation 19 of the Listing Regulations, the NRC has formulated a policy relating to the remuneration for the Directors, key managerial personnel (KMP) and other employees. The philosophy for remuneration is based on the commitment of fostering a culture of leadership with trust. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Companies Act, 2013, which are as under:

- That the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;

- Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

- Remuneration to Directors, KMP and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

The key principles governing the Remuneration Policy are as follows:

- Market competitiveness;

- Role played by the individual;

- Reflective of size of the Company, complexity of the sector/industry/ Company''s operations and the Company''s capacity to pay;

- Consistent with recognized best practices; and

- Aligned to any regulatory requirements.

In accordance with the policy, the Managing Director, Executive Director, KMPs and employees are paid basic salary, benefits, perquisites, allowances and annual incentive remuneration / performance linked bonus subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. The performance linked bonus would be driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for Independent Directors and Non-Independent Non-Executive Directors

The Non-Executive Directors, including Independent Directors, are paid sitting fees for attending the meetings of the Board and committees of the Board. The overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate Directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, complexity of the business and the Company''s capacity to pay the remuneration.

Within the ceiling of 1% of net profits of the Company, computed under the applicable provisions of the Companies Act, 2013, the Non-Executive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and determined by the Board. The basis of determining the specific amount of commission payable to a Non-Executive Director is related to his attendance at meetings, role and responsibility as Chairman or member of the Board / Committees and overall contribution as well as time spent on operational matters other than at the meetings. The shareholders of the Company had approved payment of commission to the Non-Executive Directors at the Annual General Meeting held on 26^th August, 2014, which is valid up to the year ending 31^st March, 2019. The Company will be seeking approval of the shareholders for payment of commission to the Non-Executive Directors which shall be valid for all subsequent financial years commencing from 1^st April, 2019 as provided in Section 197 of the Companies Act, 2013, at the forthcoming Annual General Meeting. No Stock option has been granted to the Non-Executive Directors.

Independent Directors'' Declaration

The Company has received the necessary declaration from each Independent Director in accordance with Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence as laid out in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

Familiarization programme for Independent Directors

All Independent Directors (''IDs'') inducted on the Board go through a structured orientation programme. Presentations are made by Executive Directors and Senior Management giving an overview of our operations to familiarize the IDs with the Company''s business operations. The IDs are given an orientation on the Company''s products, group structure and subsidiaries, Board constitution and procedures, matters reserved for the Board, and the major risks including risk management strategy.

The details for familiarization of the Independent Directors are put up on the website of the Company. As required under Regulation 46(2)(i) of the Listing Regulations, the details of familiarization programmes conducted during FY 2017-18 is also put on the Company''s website and the same can be accessed at the link: http://www.tgbl.com/company/leadership/board-of-directors

Board Diversity

The Company recognizes and embraces the importance of a diverse board in its success. The Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help the Company to retain its competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors.

Number of meetings of the Board

For seamless scheduling of meetings, a calendar is prepared and circulated in advance.

The Board of Directors had held eight meetings during FY 2017-18.

For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Listing Regulations.

Audit Committee

The details pertaining to composition of Audit Committee are included in the Corporate Governance Report which forms part of this Annual Report.

Significant and material orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

Corporate Social Responsibility (CSR) and Sustainability initiatives

In compliance with Section 135 of Companies Act, 2013, the Company has undertaken CSR activities, projects and programs, excluding activities undertaken in pursuance of its normal course of business.

The Natural Beverages Policy of Tata Global Beverages is the apex Sustainability Policy that defines the aspiration to be the consumer''s first choice in sustainable beverage production and consumption. The sustainability pillars of the Company are Sustainable Sourcing, Climate Change, Water Management, Waste Management and Community Development.

Tata Global Beverages aspires to create sustainability leadership in its beverages production units through focus on zero waste to landfill, use of renewable energy and rain water harvesting. All packeting centres globally have focused on zero waste to landfill target and only a small fraction of TGB wastes go to landfills, mostly due to techno-commercial feasibility. The Eaglescliffe factory utilizes about 39% of its electricity requirement from a 4.6MW solar farm at a nearby location. TGB has also installed solar photovoltaic plants at its Water factory in Dhaula Kuan and Sampla Packeting Centre in India that account for about 25% of the energy used in those factories. Through Project Jalodari, Tata Global Beverages supports the right to water for everyone "to sufficient, safe, acceptable, physically accessible and affordable water for personal and domestic uses." The project has established rain water harvesting and recharges structures in all Indian packeting centres.

During the year under review, the Company spent Rs. 6.51 Crores (2.12% of the average qualifying net profits of last three financial years) on CSR activities on projects qualifying as per Section 135 of

the Companies Act, 2013 duly approved by the CSR Committee. In addition to the projects specified as CSR activities under section 135 of Companies Act 2013, the Company has also carried out several other sustainability / responsible business initiatives and projects on a global scale.

Salient features of the CSR Policy and details of activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is provided in Annexure 1 forming part of this Report. The CSR Policy may be accessed on the Company''s website at the link: http:// tataglobalbeverages.com/investors/governance/policies

Particulars of employees

The information required under Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure 2 which forms part of this report.

Pursuant to Section 197 (14) of the Companies Act, 2013, the details of remuneration received by the Managing Director and the Executive Director from the Company''s subsidiary company during FY 2017-18 are also given in Annexure 2 attached to this report.

Particulars of loans, guarantees and investments by the Company

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in Annexure 3 which forms part of this report.

Risk Management

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement, and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Company has an elaborate Risk Charter and Risk policy defining risk management governance model, risk assessment and prioritization process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an oversight to the Board on Company''s risks outlined in the risk registers.

The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are addressed through mitigating actions.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has adopted zero tolerance for sexual harassment at workplace and has formulated a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under for prevention and redressal of complaints of sexual harassment at workplace. Awareness programs were conducted at various locations of the Company.

During the year, the Company received one complaint of sexual harassment which was resolved by taking appropriate action.

Deposits from public

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from public was outstanding as on 31^st March, 2018.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice, to carry out the Secretarial Audit of the Company. The Report of the Secretarial Auditor for FY 2017-18 is attached herewith as Annexure

4. There are no qualifications, observations, adverse remarks or disclaimer in the said report.

Business Responsibility Report (BRR)

The Listing Regulations mandate the inclusion of the BRR as part of the Annual Report for top 500 listed companies based on market capitalization. In compliance with the Listing Regulations, the Company has integrated BRR disclosures into the Annual Report.

Extract of Annual Return

As provided under Section 92(3) of the Companies Act, 2013, the extract of annual return in Form MGT-9 is given in Annexure 5 which forms part of this report.

Directors'' Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm:

(i) That in the preparation of the accounts for the financial year ended 31^st March, 2018, the applicable accounting standards have been followed and that there are no material departures;

Company and for preventing and detecting fraud and other irregularities;

(iv) That they have prepared the accounts for the financial year ended 31^st March, 2018 on a ''going concern basis'';

(v) That the Directors have laid down internal financial controls for the Company which are adequate and are operating effectively;

(vi) That the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

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 including audit of internal financial controls over financial 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 operating effectively during the FY 2017-18.

Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm''s length basis and in the ordinary course of business. There are no material significant related party transactions made by the Company during the year that would have required shareholder approval under Regulation 23(4) of the Listing Regulations. The disclosure in Form AOC-2 under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not applicable. All related party transactions are reported to the audit committee. Prior approval of the audit committee is obtained on a yearly basis for the transactions which are planned and / or repetitive in nature and omnibus approvals are taken as per the policy laid down for unforeseen transactions. The policy on Related Party Transactions as approved by the Board is available on the Company''s website and may be accessed at the link www.tataglobalbeverages.com/ investors/governance/policies

The details of the transactions with related parties during FY 2017-18 are provided in the accompanying financial statements.

During the year, 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, as applicable.

Directors and Key Managerial Personnel (KMP)

Mr. N. Chandrasekaran was inducted as an additional director and Chairman of the Board effective 3^rd July, 2017. He was also appointed as a Director by the members at the Annual General Meeting held on 18^th August, 2017.

Mr. Harish Bhat had stepped down as Chairman effective close of 2^nd July, 2017.

The Independent Directors on the Board of the Company, namely, Mrs. Mallika Srinivasan, Mr. V. Leeladhar, Mrs. Ranjana Kumar and Mrs. Ireena Vittal were appointed at the Annual General Meeting of the Company held on 26^th August, 2014. Mr. Siraj Azmat Chaudhry was appointed as an independent director for five years effective 3^rd July, 2017 at the AGM held on 18^th August, 2017. All the said Independent Directors have given declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

During FY 2018-19, Mr. S. Santhanakrishnan had given a declaration that he meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations. The said declaration was considered by the NRC at its meeting on 11^th May, 2018 and the Board thereafter at its meeting on 11^th May, 2018 , based on the recommendation of the NRC approved the re-categorization of Mr. Santhanakrishnan as an independent director effective 11^th May, 2018. Approval of the members for the appointment of Mr. Santhanakrishnan as Independent Director is being sought at the forthcoming Annual General Meeting.

Mr. Harish Bhat retires by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for re-appointment.

Mr. L. KrishnaKumar was appointed as Executive Director for a period of five years which ended on 31^st March, 2018. The Board based on the recommendation of the Nomination and Remuneration Committee approved the re-appointment of Mr. L. KrishnaKumar for a further period of five years from 1^st April, 2018, subject to the approval of the shareholders. The approval of the shareholders relating to Mr. L. KrishnaKumar''s re-appointment and remuneration is being sought at the forthcoming Annual General Meeting.

Pursuant to the provisions of Section 203 of the Act, the KMPs of the Company as on 31^st March, 2018 are: Mr. Ajoy Misra, Managing Director & CEO, Mr. L. KrishnaKumar, Executive Director, Mr. John Jacob, Chief Financial Officer and Mr. V. Madan, Company Secretary.

Apart from the above, no other Director or KMP were appointed or had retired or resigned during FY 2017-18.

Brief particulars and expertise of directors seeking appointment / reappointment together with their other directorships and committee memberships have been given in the annexure to the notice of the Annual General Meeting in accordance with the requirements of the Listing Regulations and applicable Secretarial Standards.

Auditors and Auditors'' Report

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso to Section 143(12) of the Companies Act, 2013.

The Statutory Auditors'' report on the financial statements for FY 2017-18 does not contain any qualifications, reservations, adverse remarks or disclaimer.

Cost Auditors

Your Board has appointed Shome & Banerjee, 5A Nurulla Doctor Lane, 2^nd Floor, Kolkata - 700 017 as Cost Auditors of the Company for conducting cost audit for FY 2018-19. The members are requested to ratify the remuneration payable to the Cost Auditors for FY 2018-19.

Disclosure Requirements

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 6 which forms part of this report.

Pursuant to the Listing Regulations, the Report on Corporate Governance along with the certificate from a Practicing Company Secretary regarding compliance of conditions of Corporate Governance, the Business Responsibility Report and the Dividend Distribution Policy are attached and are part of this Annual Report.

The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

Appreciation

The Directors wish to convey their deep appreciation to all the employees of the Company for their sincere and dedicated services as well as their collective contribution to the Company''s performance.

On behalf of the Board of Directors

N. Chandrasekaran

Mumbai Chairman

11^th May, 2018 (DIN 00121863)

Mar 31, 2017

To the Members of Tata Global Beverages Limited

The Directors are pleased to submit their fifty fourth report together with the audited financial statements of the Company for the year ended March 31, 2017.

Your Company has adopted Indian Accounting Standards (Ind AS) from April 1, 2016 as notified under Section 133 of the Companies Act, 2013 read along with the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) Rules, 2016. Accordingly the previous year''s financials have been re-casted to confirm with the requirements of Ind AS.

Financial Results Rs. in Crores

Particulars	Consolidated		Standalone 1
	2016-17	2015-16	2016-17	2015-16
Revenue from Operations	6,780	6,637	3,064	2,987
Profit from Operations before Other Income, Finance Costs, Depreciation and	791	654	363	359
Exceptional Items
Less : Depreciation	(126)	(116)	(24)	(23)
Profit from Operations before Other Income, Finance Costs and Exceptional Items	665	538	339	336
Add: Other Income (Standalone results include intra-group dividends which are	83	82	96	112
eliminated on consolidation)
Less : Finance Costs	(91)	(117)	(49)	(68)
Profit before exceptional items and taxes	657	503	386	380
Exceptional items (net)	5	(333)	-	(63)
Profit before tax	662	170	386	317
Provision for tax	(198)	(200)	(110)	(90)
Profit after tax	464	(30)	276	227
Share of net profit/(loss) in Associates and Joint Ventures	(9)	(7)	-	-
Profit for the year	455	(37)	276	227
Attributable to:
Owners of the parent	390	(5)	276	227
Non-Controlling Interest	65	(32)	-	-
Retained Earnings - Opening Balance	4,102	4,059	1,406	1,079
Add: Profit for the year	390	(5)	276	227
Add: Transfer from Debenture Redemption Reserves	81	-	81	-
Add: Realized gains on Equity Shares carried at fair value through OCI	-	328	-	328
Add: Adjustments with Other Equity	3	(47)	(18)	(8)
Amount appropriated during the year:
Dividend including dividend tax paid during 2016-17	(167)	(166)	(168)	(164)
Transfer to General Reserves	(13)	(67)	-	(56)
Retained Earnings - Closing Balance	4,396	4,102	1,577	1,406

State of Company''s Affairs Consolidated Performance

The consolidated revenue at prior year exchange rate grew by 3% aided by improvements in both branded and non branded businesses. Improved performances were recorded in the branded business mainly in EMEA and India with a strong performance by the non branded business. Profit before exceptional items and taxes reflected an improvement of 31% mainly due to higher sales, lower commodity costs, good cost management and lower interest costs. Profit for the year at Rs. 455 crores is significantly higher than the prior year mainly due to better operational performance and lower exceptional items. In the current year, exceptional items mainly include fair value gain determined as per Ind AS 103 -business combination arising out of conversion of an overseas joint venture to a subsidiary pursuant to amendments in the operating agreement, which have been largely offset by expenditure incurred on business reorganization and impairment. The exceptional items in the previous year largely reflected non cash impairment losses relating to certain businesses in Europe and US. In the year under review, the Group decided to divest its stake in a joint venture in China and to restructure certain operations relating to its business in Eastern Europe.

In the prior year, under Indian GAAP exceptional items included profit on sale of certain non core investments amounting to Rs. 328 crores, which is reported directly under Retained Earnings under Ind AS, which explains the loss for the previous year in the consolidated financial results.

Standalone Performance

The standalone revenue from operations for the year ended March 31, 2017 at Rs. 3,064 crores was higher than the prior year. Sales of most major national brands as well as across regional brands grew despite the effect of demonetization, which impacted sales during the months of November and December 2016. Reported sales growth was lower due to price decreases taken in major brands as commodity cost benefits were passed on to customers. Profit before tax at Rs. 386 crores reflected a good increase of 22% over prior year mainly due to lower interest costs and lower impact of exceptional expenditure. Exceptional expenditure in the prior year mainly reflected provisions relating to the China extraction business. Profit after tax also reflects a robust increase of 22% compared to prior year.

The Company has decided to divest its stake in its joint venture in China, Zhejiang Tata Tea Extraction Company Limited and we are in the process of getting necessary approvals in China.

Dividend

Your Directors are pleased to recommend for the approval of the shareholders a higher dividend of Rs. 2.35 per share on the equity share capital of the Company for the year ended March 31, 2017. The total outgo on account of dividend inclusive of taxes, for 2016-17 is Rs. 179 crores which represents a pay-out of 65% of the Company''s standalone profits.

Pursuant to Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the dividend distribution policy duly approved by the Board has been put up on the website of the Company and can be accessed at the link: www.tataglobalbeverages.com/investors/governance/ policies.

Transfer to Reserves

The Board of Directors approved to transfer 10% of the profit of 2016-17 to the General Reserves, amounting to Rs. 27.60 crores in 2017-18.

Share Capital

The paid up Equity Share Capital as at March 31, 2017 was Rs. 63.11 crores comprising of 63,11,29,729 equity shares of Re. 1 each. During the year under review, your Company has not issued any shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2017, none of the Directors of the Company hold instruments convertible into equity shares of the Company.

Review of Subsidiaries, Associates and Joint Venture Companies

Pursuant to Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company and its subsidiaries, associates and joint ventures, prepared in accordance with the relevant Accounting Standard specified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, form part of this Annual Report. Pursuant to the provisions of said section, a statement containing the salient features of the financial statements of the Company''s subsidiaries, associates and joint ventures in Form AOC-1 is given in this Annual Report. Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the standalone and consolidated financial statements of the Company, along with relevant documents and separate accounts in respect of subsidiaries are available on the website of the Company www.tataglobalbeverages.com.

The details of material changes in the nature of the business of some of the subsidiaries (including associates and joint ventures) during 2016-17 are given in the Management Discussion and Analysis (MD&A) attached. The impact of such changes as applicable has been adequately disclosed in the financial statements.

Your Company has adopted a policy for determining material subsidiaries in terms of Regulation 16(1 )(c) of the Listing Regulations. The policy as approved may be accessed on the Company''s website at the link: www.tataglobalbeverages.com/ investors/governance/policies.

Performance highlights of key operating subsidiaries, associates and joint ventures

Subsidiaries

Tata Global Beverages Group Ltd, UK substantially reflects the financial performance of the Tetley business and other international brands. Revenue was higher than prior year by 6% at prior year exchange rates. The growth is reflective of the improved sales in most major markets in which it operates and due to the accounting of an entity as a subsidiary in view of changes in the operating agreement. The operating profit also reflects improvement driven by improved sales, effective cost management and favorable commodity costs. Profit before tax was significantly better than the prior year because of exceptional income in the current year. In the current year, exceptional items mainly relate to fair value gain determined as per Ind AS 103 - business combination arising out of conversion of an overseas joint venture to a subsidiary. The company has in principle approved restructure of certain operations relating to its business in Eastern Europe.

Tata Coffee Limited recorded a strong performance aided by a 10% improvement in sales and a 71% improvement in operating profit mainly aided by improved performances by instant coffee and plantation operations. The Board of Directors of the company has recommended a dividend of Rs. 1.75 per share which includes a special dividend of Rs. 0.25 per share to commemorate the completion of 25 years since acquisition of controlling interest in Tata Coffee Limited by your Company. The company is also setting up a state of the art Greenfield freeze dried coffee plant in Vietnam to further its growth agenda in the premium instant coffee segment and strengthen its global footprint.

Eight O'' Clock Coffee had a strong performance driven by improved operating profits due to lower coffee commodity costs and good control over expenditure.

Tata Tea Extractions Inc.''s revenue and profit from operations grew by 9% and 34% respectively reflecting the improved realizations, favorable sales mix and reduction in cost.

Associates

Amalgamated Plantations Private Limited (APPL), India, recorded higher revenues of 9% aided by higher production but the business was adversely impacted by lower realizations. Although better quality teas commanded an improved auction pricing, the normal teas were selling in the auction at prices lower than the levels in the prior year.

Kanan Devan Hills Plantation Company Private Limited (KDHP), India, recorded an improved operating performance driven by higher productivity and better price realization. Turnover increased by 18% and the company made profits for the year under review.

Estate Management Services Private Limited (EMSPL), Sri Lanka, reported increase in consolidated revenue and significant increase in profit after tax due to good growth in palm oil business supported by improvements in tea business.

Joint Ventures

NourishCo Beverages Limited, India, our joint venture with PepsiCo, which has brands like Himalayan, Tata Water Plus and Tata Gluco Plus in its sales portfolio reported higher volume driven sales and lower operating losses compared to the previous year.

Tata Starbucks Private Limited, India reported an increase in its revenues attributable to improved in-store performance, cost and productivity initiatives coupled with the benefit of additional stores opened during 2016-17. Various in-store initiatives had been launched in the current year which encouraged customer engagement and created new occasions for the customers to visit the stores. The company also reported a lower operating loss in the year under review.

Companies which have become or ceased to be Subsidiaries, Associates and Joint Ventures

The following are the changes in subsidiaries, associates and joint ventures during 2016-17:

- Tata Waters LLC and Tata Coffee Vietnam Company Limited became subsidiaries of your Company;

- Empirical Group LLC which was a joint venture has been converted into a subsidiary;

- TRIL Constructions Limited ceased to be a subsidiary and became an associate of your Company within the meaning of the Companies Act, 2013;

There were no other changes during 2016-17.

For further analysis on the Consolidated performance, attention is invited to the section on Management Discussion and Analysis, notes to the consolidated financial statements and Form AOC 1.

Human Resources and Industrial Relations

Results of the employee engagement survey conducted during 2016-17 have shown improvement over earlier years. Key themes were identified and action plans created at all levels to improve upon each theme. The HR function had also launched various initiatives to re-energise the organization and to bring in a high performance culture. High performers were recognized across all geographies and customized programs were developed for capability building across all levels to meet the current and future business challenges.

During the year under review, industrial relations remained harmonious at all our offices and establishments.

Corporate Governance and MD&A

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MD&A). The MD&A forms an integral part of this report and also covers the consolidated operations reflecting the global nature of our business.

Vigil Mechanism / Whistle Blower Policy

Internal Financial Controls

The Company has adequate systems for Internal Financial Controls which includes operational controls and internal financial controls over financial reporting. These are detailed in the Management Discussion and Analysis Report.

Governance Guidelines

The Company''s governance guidelines on Board effectiveness cover aspects relating to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, term of Directors, retirement age and committees of the Board. The guidelines also cover key aspects relating to nomination, appointment, induction and development of Directors, Directors remuneration, oversight on subsidiary performances, code of conduct, Board effectiveness reviews and various mandates of Board committees.

Selection and Procedure for Nomination and Appointment of Directors

Criteria for determining qualifications, positive attributes and independence of a Director

In terms of the provisions of Section 178(3) of the Companies Act,

2013 and Regulation 19 of the Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors, the key features of which are as follows:

- Independence - A Director will be considered independent if he / she meets the criteria laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1 )(b) of the Listing Regulations.

Annual Evaluation of the Board, its Committees and Individual Directors

As required under the Companies Act, 2013 and the Listing Regulations, the Board of Directors conducts an annual evaluation of its own performance, Board committees and individual Directors. While making such evaluation, inputs from all the Directors are taken on the basis of criteria such as Board composition, structure, Board processes and their effectiveness, information given to the Board etc. Various aspects such as committee composition, structure, effectiveness of committee meetings etc. are considered while evaluating the performance of the Board committees after seeking inputs from the committee members.

The performances of the individual Directors are reviewed by the Board on the basis of criteria such as contribution at meetings, their preparedness on the issues to be discussed etc. Additionally, the performance of the Chairman of the Board is also evaluated on key aspects of his role.

Remuneration Policy

Pursuant to the provisions of Section 178(3) of the Companies Act, 2013, and Regulation 19 of the Listing Regulations, the NRC has formulated a policy relating to the remuneration for the Directors, key managerial personnel and other employees. The philosophy for remuneration is based on the commitment of fostering a culture of leadership with trust. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Companies Act, 2013, which are as under:

- That the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the company successfully;

- Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

- Remuneration to Directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

The key principles governing the Remuneration Policy are as follows:

- Market competitiveness;

- Role played by the individual;

- Reflective of size of the company, complexity of the sector/ industry / Company''s operations and the Company''s capacity to pay;

- Consistent with recognized best practices; and

- Aligned to any regulatory requirements.

In accordance with the policy, the Managing Director, Executive Director, KMPs and employees are paid basic salary, fixed salary, benefits, perquisites, allowances and annual incentive remuneration / performance linked bonus subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. The performance linked bonus would be driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for Independent Directors and Non-Independent Non-Executive Directors

The Company pays a sitting fee of Rs. 30,000 per meeting per Director for attending meetings of the Board, Audit, Nomination and Remuneration and Executive Committees. For meetings of all other committees of the Board, a sitting fee of Rs. 20,000 per meeting per Director is paid. Within the ceiling of 1% of net profits of the Company, computed under the applicable provisions of the Companies Act, 2013, the

Non-Executive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRC and determined by the Board. The basis of determining the specific amount of commission payable to a Non-Executive Director is related to his attendance at meetings, role and responsibility as Chairman or member of the Board / Committees and overall contribution as well as time spent on operational matters other than at the meetings. The shareholders of the Company had approved payment of commission to the Non-Executive Directors at the Annual General Meeting held on August 26, 2014, which is valid up to the financial year ended March 31, 2019. No Stock option has been granted to the Non-Executive Directors.

Familiarization programme for Independent Directors

The details for familiarization of the Independent Directors are put up on the website of the Company. As required under Regulation 46(2)(i) of the Listing Regulations, the details of familiarization programmes conducted during 2016-17 is also put on the Company''s website and the same can be accessed at the link www.tataglobalbeverages.com/company/leadership/Board-of-Directors.

Number of meetings of the Board

The Board of Directors had held nine meetings during 2016-17. For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report.

Audit Committee

The details pertaining to composition of Audit Committee are included in the Corporate Governance Report which forms part of this Annual Report.

Significant and material orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

Corporate Social Responsibility (CSR) and Sustainability initiatives

In compliance with Section 135 of Companies Act, 2013, the Company has undertaken CSR activities, projects and programs, excluding activities undertaken in pursuance of its normal course of business. The report on CSR activities as required under Companies (Corporate Social Responsibility Policy) Rules,

2014 is given in Annexure 1 forming part of this Report. The CSR Policy may be accessed on the Company''s website at the link www.tataglobalbeverages.com/investors/governance/policies.

During the year under review, the Company spent Rs. 7.79 crores (2.94% of the average qualifying net profits of last three financial years) on CSR activities on projects qualifying as per Section 135 of the Companies Act, 2013 duly approved by the CSR Committee. In addition to the projects specified as CSR activities under section 135 of Companies Act 2013, the Company has also carried out several other sustainability / responsible business initiatives and projects on a global scale.

The Natural Beverages Policy of the Company is the apex sustainability policy that defines the aspiration to be the consumer''s first choice in sustainable beverage production and consumption. The sustainability pillars of the Company are Sustainable Sourcing, Climate Change, Water Management, Waste Management and Community Development. The Company encourages its suppliers to use ecological and sustainable agricultural practices in tea production and has used 100% sustainably sourced tea for the Tetley brand in EMEA and CAA regions this year. The Company is also co-funding "Trustea" - the India sustainable tea program that aims to sustainably transform Indian tea, and has certified 370 million kgs of tea by December 2016, reaching over 400 tea estates and 350,000 workers. Tata Global Beverages was awarded "Tata Innovista 2016" award for Sustainable Plant Protection Formulation (S-PPF), to develop a portfolio of bio-pesticides and package of practices with 5 other Tata companies.

The Company is ranked in the ''A-list'' of Climate Disclosure Leadership Index (CDLI India 2016) that measures the carbon footprint of all its beverage production units globally. It has a four pronged climate change strategy focused on sustainable agriculture for climate change adaptation, sustainable forestry for climate change mitigation, energy efficiency and renewable energy. The Company recognizes that the right to water is an international human right and supports the right to water for everyone "to sufficient, safe, acceptable, physically accessible and affordable water for personal and domestic uses." The Company has initiated ''Project Jalodari'' for rain water harvesting or recharge in all Indian tea packeting centres. The Company is committed to optimize consumer packaging, make efficient use of resources and reduce environmental impact without compromising product quality and safety. The Eaglescliffe factory in UK is a zero waste to landfill unit, and the goal is to replicate this in all beverage production units in the near future.

The Company respects and adheres to the Tata Group''s philosophy of giving back to the community, and acknowledges the role played by communities in the growth of its business. Tata Global Beverages focuses on women empowerment, skill development, education and health & nutrition for the development of the communities it operates in. Tata Global Beverages and Tata Trusts have contributed $1 million to Smile Train, an international children''s charity, for providing cleft repair surgery and comprehensive cleft care to 4000 children this year. Tata Global Beverages is co-funding a program by UNICEF (a United Nations Agency) and Ethical Tea Partnership (ETP) for promoting child rights and child protection in tea gardens of Assam, and has reached 29,000 adolescent girls and 28,000 community members till the year under review. The Company provides affordable healthcare to 100,000 community members every year through High Range Hospital (formerly General Hospital), Munnar (Kerala) and The Referral Hospital and Research Centre (RHRC), Chubwa (Assam). It also collaborates with various Tata companies in activities and programs for volunteering and affirmative actionâs.

Particulars of employees

Pursuant to Section 197 (14) of the Companies Act, 2013 the details of remuneration received by the Managing Director and the Executive Director from the Company''s subsidiary company during 2016-17 are also given in Annexure 2 attached to this report.

Particulars of loans, guarantees and investments by the Company

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in Annexure 3 attached to this report.

Risk Management

The Risk Management Committee of the Board is entrusted with the responsibility to assist the Board in overseeing and approving the Company''s risk management framework. The Company has an elaborate Risk Charter and Risk policy defining risk management governance model, risk assessment and prioritization process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an oversight to the Board on Company''s risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has adopted zero tolerance for sexual harassment at workplace and has formulated a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules there under for prevention and redressal of complaints of sexual harassment at workplace. Awareness programs were conducted at various locations of the Company.

Deposits from public

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from public was outstanding as on March 31, 2017.

Secretarial Audit

Extract of Annual Return

As provided under Section 92(3) of the Companies Act, 2013, the extract of annual return in Form MGT-9 is given in Annexure 5 which forms part of this report.

Directors'' Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm:

(i) That in the preparation of the accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed and that there are no material departures;

(iv) That they have prepared the accounts for the financial year ended March 31, 2017 on a ''going concern basis'';

(v) That the Directors have laid down internal financial controls for the Company which are adequate and are operating effectively;

(vi) That the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

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 including audit of internal financial controls over financial 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 operating effectively during the financial year 2016-17.

Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm''s length basis and in the ordinary course of business. There are no material significant related party transactions made by the Company during the year that would have required shareholder approval under Regulation 23(4) of the Listing Regulations. All related party transactions are reported to the audit committee. Prior approval of the audit committee is obtained on a yearly basis for the transactions which are planned and / or repetitive in nature and omnibus approvals are taken as per the policy laid down for unforeseen transactions. The disclosure under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not applicable. The policy on Related Party Transactions as approved by the Board is available on the Company''s website and may be accessed at the link www.tataglobalbeverages.com/investors/governance/policies.

The details of the transactions with related parties during 2016-17 are provided in the accompanying financial statements.

Directors and Key Managerial Personnel (KMP)

The Board had appointed Mr. N. Chandrasekaran as an Additional Director on the Board of the Company with effect from 3^rd July, 2017. Mr. N. Chandrasekaran is Chairman of the Board of Tata Sons, promoter of more than 100 Tata operating companies, including your Company, with aggregate annual revenues of more than US$100 billion. He joined the board of Tata Sons in October 2016 and was appointed Chairman in January 2017. He also chairs the boards of several group operating companies, including Tata Steel, Tata Motors, Tata Power, Indian Hotels and Tata Consultancy Services (TCS) â of which he was chief executive from 2009-17. Under his leadership, TCS generated total revenues of US$16.5 billion in 2015-16 and consolidated its position as the largest private sector employer in India and the country''s most valuable company.

Mr. Harish Bhat had stepped down as Chairman of the Board effective 2^nd July, 2017. Your Board appointed Mr. N. Chandrasekaran as the Chairman of the Board of the Company with effect from 3^rd July, 2017 in the place of Mr. Harish Bhat. Your Board places on record its deep appreciation for the excellent contributions made by Mr. Harish Bhat as Chairman of the Board.

The Board had also appointed Mr. Siraj Azmat Chaudhry as an Additional Independent Director on the Board of the Company with effect from 3^rd July, 2017. Mr. Siraj Chaudhry is Chairman of Cargill India. His tenure at Cargill spans nearly 23 years, and includes handling the leadership role in India, as well as a global commodity trading role in Geneva. Under his leadership since 2007, Cargill India has successfully built both consumer FMCG businesses in India, and Institutional businesses, backed by world class manufacturing facilities, robust sales & distribution network, and an enviable brand portfolio.

Pursuant to Section 161(1) of the Companies Act, 2013, Mr. Chandrasekaran and Mr. Chaudhry will hold office upto the date of the forthcoming Annual General Meeting. The Company has received notices under Section 160(1) of the Act proposing the candidatures of Mr. Chandrasekaran and Mr. Chaudhry for appointment as Directors at the forthcoming AGM.

Mr. Harish Bhat and Mr. S Santhanakrishnan, Directors, retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election.

Brief particulars and expertise of the Directors seeking appointment / reappointment together with their other directorships and committee memberships have been given in the annexure to the notice of the Annual General Meeting in accordance with the requirements of the Listing Regulations.

The Independent Directors on the Board of the Company, namely, Mrs. Mallika Srinivasan, Mr. V Leeladhar, Mrs. Ranjana Kumar and Mrs. Ireena Vittal were appointed at the Annual General Meeting of the Company held on August 26, 2014. The said Directors have given declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

Mr. Siraj Azmat Chaudhry who was appointed as an Additional Independent Director with effect from 3^rd July, 2017 has also given a declaration that he meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)

(b) of the Listing Regulations.

During the year under review, your Board of Directors had resolved to replace Mr. Cyrus P. Mistry as Chairman of the Board at its meeting held on November 15, 2016 and appointed Mr. Harish Bhat as Chairman of the Board effective 15^th November, 2016. Mr. Cyrus P Mistry resigned as a Director from the Board of the Company with effect from December 19, 2016.

Mr. Analjit Singh and Mr. Darius Pandole, Independent Directors, resigned from the Board with effect from December 20, 2016.

Apart from the above, no other Director or key managerial personnel were appointed or had retired or resigned during 2016-17.

Auditors and Auditors'' Report

The members at the Annual General Meeting held on August 26, 2014, had appointed Lovelock and Lewes, as the Statutory Auditors for three years subject to ratification by the members each year. Accordingly the term of Lovelock and Lewes ends at the conclusion of the forthcoming Annual General Meeting. Your Board recommends the appointment of Deloitte Haskins & Sells, LLP, Chartered Accountants, as the Statutory Auditors of the Company from the conclusion of the fifty fourth Annual General Meeting until the conclusion of the fifty ninth Annual General Meeting of the Company to be held in the year 2022.

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso to Section 143(12) of the Companies Act, 2013.

The Auditors'' report on the financial statements for the year 2016-17 does not contain any qualifications, reservations or adverse remarks.

Cost Auditors

Your Board has appointed Shome and Banerjee, of 5A Nurulla Doctor Lane, 2^nd Floor, Kolkata - 700 017 as Cost Auditors of the Company for conducting cost audit for the financial year 2017-18. The members are requested to ratify the remuneration payable to the Cost Auditors for 2017-18.

Disclosure Requirements

Appreciation

On behalf of the Board of Directors

N. Chandrasekaran

Mumbai Chairman

06^th July, 2017 (DIN 00121863)

Mar 31, 2016

The Directors are pleased to submit their fifty third report together with the audited financial statements of the Company for the year ended 31st March 2016.

Financial Results Rs. in Crores

Consolidated Standalone

2015-16 2014-15 2015-16 2014-15

Revenue from Operations 8,111 7,993 3,084 2,885

Profit from Operations before Other Income, Finance Costs, 675 775 342 317 Depreciation and Exceptional Items

Less: Depreciation (143) (133) (23) (20)

Profit from Operations before Other Income, Finance Costs and 532 642 319 297 Exceptional Items

Add: Other Income (Standalone results include intra-group dividends 71 70 107 155 eliminated on consolidation)

Less: Finance Costs (69) (82) (30) (34)

Profit before exceptional items and taxes 534 630 396 418

Exceptional items (net) 11 (130) 265 (69)

Profit before tax 545 500 661 349

Provision for tax (210) (216) (97) (60)

Profit after tax 335 284 564 289

Share of Net loss in Associates (1) (11) - -

Minority Interest (8) (25) - -

Profit for the year 326 248 564 289

Add: Surplus brought forward from previous year 3,331 3,276 920 820

Add: Adjustment on Amalgamation - 20 - 2

Amount available for appropriation 3,657 3,544 1,484 1,111

Proposed dividend (142) (142) (142) (142)

Dividend distribution tax (23) (21) (23) (19)

Transfer to general reserve (68) (49) (56) (29)

Adjustment on evaluation of useful life of Fixed Asset - (1) - (1)

(33) (213) (221) (191)

Retained in profit and loss statement 3,424 3,331 1,263 920

State of Company''s Affairs Consolidated Performance

Consolidated Income from operations for 2015-16 was Rs. 8,111 Crores, against Rs. 7,993 Crores in the previous year, reflecting a 2% growth aided by improved performance both in the branded and unbranded businesses. At prior year exchange rates, the increase would be 3%. Within the branded business, India tea business performed well with good value and volume growth and our incubatory businesses, such as MAP in Australia, Tata Starbucks and NourishCo also increased their revenues. Within the non branded portfolio, improvements were mainly recorded in Coffee plantation and Coffee extraction businesses.

Profit from operations declined against the prior year mainly in the branded business due to underperformances in some developed markets. This decline is largely attributable to commodity price increases in coffee and tea in the international markets, higher spends behind brands and new launches, category decline in some developed markets and increased competitor and retailer activities. The Indian branded and non-branded businesses performed well offsetting the lower performance in developed markets. Profit after tax was however significantly higher than prior year mainly due to the impact of exceptional items. During the year, your Company sold some non-core investments realising a profit of Rs. 328Crores.The Company also recoqnised non cash impairment losses amounting to Rs. 270 Crores mainly relating to its businesses in Eastern Europe and US. While the Company is actively pursuing various growth opportunities, the accounting impairment has been recoqnised due to underperformances as compared to plans mainly arising out of factors like macro- economic instability in Russia and category decline in every day black tea in certain markets and higher competitive intensity in some markets.

We continued our focus on green and specialty teas across markets during the year under review. There was renewed focus of increasing the distribution for our super premium segment whilstfocus on newinnovative products continued. The"Super Green tea" which is the first fortified green tea with proven health benefits which was launched in UK saw significant growth and was ahead of category growth on a full year basis. There was also significant growth in the green tea segment in India, France and US. Fruit and herbal teas were launched in UK and US where customer response has been very positive. Teapigs, our super premium tea brand, saw significant growth in UK, US and Canada and other international markets with improved distribution. In India, our new coffee brand, Tata Coffee Grand had a high impact launch which created the desired buzz and visibility. In addition, Tata Tea Gold with a region specific blend was launched in the state of Maharashtra which received favourable customer response. Various new products like the Signature Collection and London Blend have been launched in select developed markets. The year also reflected good execution of the launch plans in Middle-East which resulted in market share increases. The performance of the businesses under our strategic partnership with Starbucks and PepsiCo also saw good growth. In Tata Starbucks, growth has been achieved as a result of good in-store performance and expansion in the number of stores. NourishCo reflected good growth based on significant increase in the sales of Tata Gluco Plus and a moderate growth in Himalayan sales.

Your Company''s consolidated performance has to be viewed in the context of difficult macro economic conditions and the emerging category trends in some of the developed markets that the Company operates in and that investments are being made for future growth.

Your Company''s focus in 2016-17 would be to invest in innovations and capability building in line with the Group''s medium term strategy plan and balancing the same with pressures on EBIT margins by prioritising our strategic objectives. The key focus themes across all regions will be to drive innovation and build momentum on the recent launches. Our focus will also be on improving distribution and driving cost efficiencies. We will meet these objectives through strengthening and leveraging people capabilities and robust execution of plans with continued commitment to our sustainability initiatives.

Standalone Performance

Your Company''s Income from operations for the year ended 31st March 2016 was Rs. 3,084 Crores, registering an improvement against the prior year, driven by increase in volumes and average realisation reflecting the increase in both national and regional brands. Profit from operations at Rs. 319 Crores was higher than the previous year mainly driven by increased sales and lower commodity and input cost trends despite higher spends behind brands and new launches. Profit before and after tax was significantly higher aided by exceptional income, derived through sale of non-core investments partially offset by provisions relating mainly to the China extraction business arising out of delays in startup and stabilisation of technology for an enhanced product range.

Your Company recorded 7% income growth over the prior year with increases in the flagship Tata Tea Brands and also in the Regional brands. Your Company is pleased to report that it continues to maintain both volume and value leadership in the overall branded tea category and leadership in the green tea category, in a challenging and competitive environment. During the year, your Company renewed its focus on green tea and launched innovative products. The Company launched Tata Tea Gold with a region specific blend to strengthen its foothold in Maharashtra for which consumer response has been positive. In addition, to expand the product category, your Company launched Tata Coffee Grand with a unigue blend that is gaining consumer acceptance.

Share Capital

The Amalgamation of Mount Everest Mineral Water Limited (MEMW) with the Company was completed during the year under review. Pursuant to and in consideration of the Scheme of Amalgamation of MEMW with your Company, which was effective 18th May 2015, your Company issued and allotted 1.27 Crore eguity shares of Re. 1 to the eligible shareholders of MEMW, post which, the paid up capital of the Company increased to Rs. 63.11 Crores.

Dividend

Your Directors are pleased to recommend for the approval of the shareholders, a dividend of Rs. 2.25 per share on the equity share capital of the Company with respect to the financial year 2015-16. The total outgo on account of dividend, inclusive of taxes, for 2015-16 is Rs. 165 Crores which represents a pay-out of 29% of the Company''s stand alone profits.

Transfer to Reserves

An amount of Rs. 56 Crores is proposed to be transferred to General Reserves out of the amount available for appropriation and an amount of Rs. 1,263 Crores is proposed to be retained in the profit and loss statement.

Review of Subsidiaries, Associates and Joint Venture Companies

Pursuant to Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company and its subsidiaries, joint ventures and associates, prepared in accordance with the relevant Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014, form part of this Annual Report. Pursuant to the provisions of the said section, a statement containing the salient features of the financial statements of the Company''s subsidiaries, associates and joint ventures in Form AOC-1 is given in this Annual Report. Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statements of the Company, consolidated financial statements along with relevant documents and separate accounts in respect of subsidiaries are available on the website of the Company.

There have been no material changes in the nature of the business of the subsidiaries (including associates and joint ventures) during the financial year 2015-16. Acquisitions/ divestments, as applicable, have been adequately disclosed in the financial statements.

Your Company has adopted a policy for determining material subsidiaries in terms of Regulation 16(1)(c) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations).The Policy as approved may be accessed on the Company''s website at the link: http://www.tataglobalbeverages.com/docs/default-source/ lnvestor-Governance-Policy-/policy-on-subsidiary.pdf?sfvrsn=0

Performance highlights of key operating subsidiaries / associates /joint ventures Indian Operations Tata Coffee Limited

Tata Coffee recorded a turnover of Rs. 718 Crores reflecting a growth of 5% over the prior year. The improvement is mainly attributable to higher instant coffee sales. The turnover of the plantation business also showed improvement driven by higher sales of Robusta and Pepper offset by lower Arabica volumes due to off year trends. The Instant Coffee business reported a strong growth in Africa and a favourable portfolio mix of volumes contributed to the Instant Coffee''s turnover and profitability. The overall profitability of the plantation business was flat impacted by seasonal nature of the business, soft tea prices and higher costs. The depreciation policy for Tata Coffee was changed to align to a single basis of depreciation for similar type of assets as opposed to different basis of depreciation being followed earlier. A write-back was taken to exceptional items to reflect the impact of the change. Post the impact of exceptional items, Profits before and after tax are at prior year levels.

The Directors of Tata Coffee Limited have recommended a dividend of Rs.1.30 per equity share of Re. 1 each for the year 2015-16 which is the same as last year.

The instant coffee operations continues to focus on operational discipline, cost reduction and sustainability in operations. With a specific focus on cost reduction, various alternatives have been used to reduce the power and fuel costs in the instant coffee factories. In addition, the Then Unit won the CII Sustainability award and Toopran unit won the National level Energy conservation award.

Tata Coffee also won two awards at the 12th Golden Leaf India Awards 2016 in recognition of the high quality teas produced at their factory located in the Anamalai hills in South India. Additionally, Plantation Trails, Tata Coffee''s hospitality brand, was awarded the''Certificate of Excellence''from Trip Advisor, the world''s largest travel website, for the third consecutive year. The award is based purely on customer feedback and ratings.

NourishCo Beverages Limited

NourishCo Beverages Limited, a joint venture with PepsiCo, is driving our water agenda in India. It distributes the Himalayan brand whilst it manufactures and sells the Tata Water Plus and Tata Gluco Plus brands. The Company registered a turnover of Rs. 125 Crores for 2015-16, reflecting a growth of 44%.Tata Gluco Plus has been performing extremely well and high double digit growth in volume and value terms were recorded during the year 2015-16.

The new proposition of''Gas minus Energy Plus"and the visual changes on the packaging to communicate"Energy"forthe brand were received very well by the consumers and have accelerated the brand''s growth rate. We strengthened our distribution with presence in Maharashtra, Karnataka, Gujarat and Kerala. In addition, Himalayan sales declared a double digit growth in volume and value by focusing on channel mix and selective price increases. During the year, a television commercial was run with the objective of establishing Himalayan''s source credentials.

Tata Starbucks Private Limited

Tata Starbucks recorded a turnover of Rs. 235 Crores during 2015-16 registering a growth of 39% over the prior year. Tata Starbucks''store count stands at 82 at the end of the financial year. The business continues to perform well with revenue growth driven by improved store performance and increase in the number of stores. In-store performance has been robust helped by various initiatives such as localisation of supply chain and other similar initiatives contributing to improving profitability.

Amalgamated Plantations Private Limited (APPL)

For the financial year 2015-16, turnover at Rs. 570 Crores was in line with prior year. However, profits were impacted mainly due to wage revisions which were negotiated on a tripartite basis. The business registered record production in February/March 2016 due to good rains during end season. During the year, whilst regular tea prices were soft, premium teas reflected a hardening trend. In addition APPL is also involved with the tea extension planting advisory services initiative which ensures that the small tea growers are trained in Good Tea Cultivation practices to increase yield and improve compliance and quality of green leaf. This will help them get a fair price for sustainable livelihood and become a stable supply base to APPL factories. This initiative has led to identification and linkage of 5,252 small tea growers to APPL Estates for green leaf supply in 2016-17. Further, certain gardens achieved RA certifications and Trust Tea certification, in addition to ISO 22000 and SA 8000.

Kanan Devan Hills Plantation Company Private Limited (KDHP)

For the financial year 2015-16, KDHP recorded a turnover of Rs. 259 Crores. The profitability and operations were impacted by labour unrest in its estates and factories for a week in September and for a fortnight in October, resulting in heavy loss of production. The unrest was across most plantations in Kerala due to demands for wage revision and higher bonus. Additionally, loss of production during this period of unrest and its aftermath, left the tea fields in overgrown condition necessitating substantial costs for ensuing restoration work on the affected fields, which further impacted both production and income. The Company also incurred substantial increase in costs due to a significant increase in labour wages as decided by the Plantation Labour Committee, constituted by the Government of Kerala, and this plantation industry wide wage revision, done once in three years, was due in 2015.

Despite the labour unrest, the productivity for the season was higher than the previous year and total crop production performance was better than that of other companies in Munnar. The average price of tea achieved for the year was also higher than previous year, due to the increased production of high value teas and firming up of tea prices during the second half. In the Great Places to Work Survey (2015) conducted by the Economic Times and Great Place to Work9 Institute, KDHP was ranked 97 in the Top 100 of India''s Best Companies to Work for in 2015. On the quality front, KDHP won two awards at the 2016 Golden Leaf India Awards competition held at Dubai, a testimony to the stringent quality standards adopted by the Company. Additionally, two tea factories were awarded the Appreciation Award under the Small Industry Category of the Kerala State Pollution Control Award, 2016. This is a testimony to the strict safety standards maintained by all KDHP establishments. On the certifications front, KDHP continues to maintain all certifications of international repute, including Rainforest Alliance, Fairtrade, Organic, ISO 22000, ETP, GMP and Trustea. It was a moment of great joy and pride when the Company passed the Rainforest Alliance annual audit, with an astounding score of 98.9%.

International Operations

Eight O Clock Coffee Company (EOC)

EOC''s total income, under IGAAP, during 2015-16 at Rs. 1,046 Crores was higher than the previous year''s income of Rs. 1,008 Crores. The increase in top line is mainly due to favourable currency movement. The business grew its non-promoted volumes over prior year but a significant increase in competitor intensity through additional promotional events and deeper discounting adversely affected the overall sales. Profits were impacted because of lower sales coupled with increase in coffee commodity costs. During the year, Eight O Clock Coffee was the recipient of two Reggie awards for their earlier partnership with Warner Brothers celebrating the 20th anniversary of the hit comedy TV show"Friends".The award recognises the best marketing campaigns activated by brands with a focus on strategy, creativity, originality, integration and results.The campaign resulted in introducing the brand to a younger consumer base which ultimately contributed to brand sales growth.

Tata Global Beverages Group Limited, UK

The consolidated income from Tata Global Beverages Group Limited, UK, under IGAAR which substantially reflects the financial performance of the Tetley business and other international brands, at Rs. 3,313Crores, was lower than prior year mainly due to adverse translation impact. At constant exchange rates, there was a marginal underlying topline growth. The improvement in underlying sales is mainly due to improvements in the Teapigs brand, Russia, Middle East, South Africa, and coffee business in Australia partially offset by lower performance in other key markets. The operating profit was behind prior year mainly due to category de-growth and high competitive intensity in some major markets, higher commodity prices, impact of the macro- economic condition prevailing in countries like Russia and higher spends on new launches and market entries. The underlying performance of the main brands was strong with many successes. Teapigs, our super premium brand has done exceedingly well by growing distribution in UK, US and in other international markets. Green tea has exceeded expectations and our growth is significantly higher than the category growth in UK. Super greens is the star performer in UK and the green tea portfolio, though small, has significantly increased in the last couple of years. In addition to UK, green tea has also done well in US, Canada and France. During the year, fruit and herbal categories were launched in UK and US and the initial response is positive. A new premium variant, the Signature Collection which was launched in Canada is gaining distribution and a new blend -"British Brands"was launched in US. Various advertisement campaigns were deployed in markets to support the Tetley brand and new launches. Whilst in the UK there was a focus on Tetley advertisement using the iconic "teafolk"and implementation of a new pack, Canada concentrated on Signature Collections and new packaging changes. We continue to be market leaders in Canada and have gained volume share in the UK.

The Company is happy to inform you that for the second year running, Tetley has been recoqnised in the 2015 Great Taste Awards, winning coveted gold stars for its Kenyan Gold (Blend Collection), Pure Green, Redbush Vanilla, Super Green Tea, Boost, Lime and Serenity, and Mood Infusions. The Great Taste Awards is one of the world''s largest and most trusted food and drink awards, organised by the Guild of Fine Food. This respected seal of approval is a sign of quality, which consumers can trust whilst buying food and drink from their local retailer.

Non Cash Goodwill impairments were recorded during the year under review mainly relating to its businesses in Eastern Europe and US. While the Company is actively pursuing various growth opportunities, the accounting impairment has been recoqnised due to underperformances as compared to plans mainly arising out of factors like macro-economic instability in Russia and category decline in every day black tea / competitive intensity in other markets.

Tata Tea Extractions Inc.

Tata Tea Extractions Inc., a wholly owned subsidiary in the USA supplies customer specific tea ingredients to Iced Tea Beverage companies. During the year, the income from sales in underlying currency increased by 1%, while the Profit from Operations grew by over 5%, when compared to the previous year. This was mainly on account of improved realisation from customers despite challenging market conditions, favourable blend mix and a marginal reduction in the cost of goods sold.

In addition to the existing products, Tata Tea Extractions has developed a new formulation during the year to cater to the requirements of new customers as well as existing customers. The initial feedback on this formulation from some of the customers have been favourable. In the manufacturing plant in Munnar, we are also working on an enhanced product range for one of our major customers. Developmental activities such as these, coupled with the existing product range is expected to help the company to sustain and grow the extraction business.

Zhejiang Tata Tea Extraction Company Limited- China Joint Venture operations

Delays continue in stabilisation of the China business. While prospective customers have shown interest in our instant tea products, the final conversion to orders will be dependent on meeting the product profile requirements. Going forward, stabilising the production process and establishing a pipeline of external customers and successful scaling of technology will be key to the success of the project. In view of the continued uncertainty of the business, your Company is evaluating various options for restructuring the business.

Estate Management Services Private Limited (EMSPL)

Estate Management Services Private Limited, Sri Lanka (EMSPL) in which your Company owns 31.85% of the shares, is the holding company of Watawala Plantations Limited (WPL). WPL is one of the largest producers of tea and palm oil in Sri Lanka and amongst the most efficiently run in that country. EMSPL also owns Watawala Tea Ceylon Limited (WTCL) which is in the branded business and owns three key brands''Zesta'',''Watawala'' and''Ran Kahata''which together command 33% market share of the branded tea market in Sri Lanka. Sri Lankan tea has good acceptance in several countries including Russia, South East Asia, Australia and Middle East.

EMSPL has continued to perform well during 2015-16. Watawala Plantations PLC registered growth in profitability driven by better performance of tea and rubber segments. Watawala Tea Ceylon also recorded healthy growth in operating performance with both revenue and profitability substantially improving over the previous financial year.

Companies which have become or ceased to be Subsidiaries, Associates and Joint Ventures

During 2015-16, RBC Hold Co LLC ceased to be a subsidiary as it was dissolved during the year. As stated above, Mount Everest Mineral Water Limited, an erstwhile subsidiary, was amalgamated with the Company, effective 18th May, 2015. No other company became or ceased to be a subsidiary, joint venture or associate during 2015-16.

Human Resources and Industrial Relations

During the year under review, a key agenda of the Company was to prioritise HR imperatives to support the Company''s ambitious growth plans. The theme was ''Raising the Bar''and laying down practices on HR policies and principles to support in accelerating business Growth. The Company further continued leveraging the 3 tier leadership program to build the leadership capabilities across regions.

During the year under review, industrial relations remained harmonious at all our offices and establishments.

Corporate Governance and MD &A

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MDA). The MDA also covers the consolidated operations and reflects the global nature of our business.

Vigil Mechanism /Whistle Blower Policy

The Company has a vigil mechanism for directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the code of conduct/business ethics that provides for adeguate safeguards against victimisation of the director(s) and employee(s) who avail of the mechanism. No director/employee has been denied access to the Chairman of the Audit Committee.

Internal Financial Controls

The Company has adeguate system of Internal Controls which are detailed in the Management Discussion and Analysis Report.

Governance Guidelines

The Company has adopted a governance guidelines on Board effectiveness. The guidelines cover aspects relating to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, term of directors, retirement age and committees of the Board. The guidelines also cover aspects relating to nomination, appointment and induction and development of directors, directors remuneration, subsidiary oversight, code of conduct, Board effectiveness reviews and mandates of Board committees.

Procedure for Nomination and appointment of directors

The Nomination and 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 NRC makes recommendations to the Board in regard to appointment of new directors. The NRC also conducts a gap analysis to refresh the Board on a periodic basis, including each time a directors appointment or re-appointment is required. The NRC is also responsible for reviewing the profiles of potential candidates vis-a-vis the required competencies, undertake a reference and due diligence and meeting of potential candidates prior to making recommendations of their nomination to the Board. At the time of appointment, specific requirements for the position, including expert knowledge expected, is communicated to the appointee.

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 the provisions of Section 178(3) of the Companies Act, 2013 and Regulation 19 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the key features of which are:

Qualifications -The Board nomination process encourages diversity of thought, experience, knowledge, age and gender. It also ensures that the Board has an appropriate blend of functional and industry expertise.

Positive Attributes- Apart from the duties of directors as prescribed in the Companies Act, 2013, the directors are expected to demonstrate high standards of ethical behaviour, communication skills and independent judgment. The directors are also expected to abide by the respective Code of Conduct as applicable to them.

Independence - A director will be considered independent if he / she meet the criteria laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) the Listing Regulations.

Annual Evaluation of the Board, its Committees and Individual Directors

The Board of directors had carried out an annual evaluation of its own performance, board committees and individual directors as required under the Companies Act, 2013 and the Listing Regulations. The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as board composition, structure, board processes and their effectiveness, information given to the board etc. The performance of the board committees was evaluated by the board after seeking inputs from the committee members on the basis of criteria such as committee composition, structure, effectiveness of committee meetings etc.

The Board and the NRC reviewed the performance of the individual directors on the basis of criteria such as contribution at meetings, their preparedness on the issues to be discussed etc. Additionally the Chairman was also evaluated on key aspects of his role.

Remuneration Policy

The NRC has formulated a policy relating to the remuneration for the directors, key managerial personnel and other employees. The philosophy for remuneration is based on the commitment of fostering a culture of leadership with trust. The remuneration policy has been prepared pursuant to the provisions of Section 178(3) of the Companies Act, 2013, and Regulation 19 of the Listing Regulations. While formulating this policy, the NRC has considered the factors laid down in Section 178(4) of the Companies Act, 2013, which are as under:

That the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully;

Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

Remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.

The key principles governing the remuneration policy are as follows:

Market competitiveness

Role played by the individual

Reflective of size of the company, complexity of the sector/ industry/ company''s operations and the company''s capacity to pay

Consistent with recoqnised best practices and Aligned to any regulatory requirements

In accordance with the policy, the Managing / Executive directors / KMPs / employees are paid basic/ fixed salary, benefits, perquisites and allowances and annual incentive remuneration/ performance linked bonus subject to achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. The performance linked bonus would be driven by the outcome of the performance appraisal process and the performance of the Company.

Remuneration for independent directors and non independent non executive directors

The non-executive Directors, including Independent Directors, are paid Sitting fees for attending the meetings of the Board and Committees of the Board. The overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company including considering the challenges faced by the Company and its future growth imperatives. The remuneration should also be reflective of the size of the Company, complexity of the business and the Company''s capacity to pay the remuneration.

The Company pays a sitting fee of Rs. 30,000 per meeting per director for attending meetings of the Board, Audit, Nomination and Remuneration and Executive Committees (Rs. 20,000 in case of Mr. Cyrus Mistry, Chairman and Mr. Harish Bhat, Director). For meetings of all other Committees of the Board, a sitting fee of Rs. 20,000 per meeting per director is paid (Rs. 15,000 in case of Mr. Cyrus Mistry, Chairman and Mr. Harish Bhat, Director). Within the ceiling of 1% of net profits of the Company computed under the applicable provisions of the Companies Act, 2013, the Non-Executive Directors including Independent Directors are also paid a commission, the amount whereof is recommended by the NRCand determined by the Board. The basis of determining the specific amount of commission payable to a Non-Executive Director is related to his attendance at meetings, role and responsibility as Chairman/Member of the Board/Committees and overall contribution as well as time spent on operational matters other than at the meetings. The shareholders of the Company had approved payment of commission to the non-executive directors at the Annual General Meeting held on 26th August 2014, which is valid up to the financial year ending 31st March 2019. No Stock option has been granted to the Non-Executive Directors.

Familiarisation programme for independent directors

The details for familiarisation of the independent directors are given in the website and the same can be accessed at the link http://www.tataglobalbeverages.com/company/leadership/ boa rd-of-di rectors

As required under Regulation 46(2)(i) of the Listing Regulations, the details of familiarisation programmes conducted during the year 2015-16, is also put on the Company''s website.

Number of meetings of the Board

Nine meetings of the Board of Directors were held during the year 2015-16. For further details, please refer to the Corporate Governance Report, which forms part of this Annual Report.

Audit Committee

The details pertaining to composition of audit committee are included in the Corporate Governance Report which forms part of this Annual Report.

Significant and material orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations.

Corporate Social Responsibility and Sustainability initiatives

The Natural Beverages Policy of Tata Global Beverages is the apex policy that incorporates all relevant elements of Sustainability, Corporate Social Responsibility, Affirmative Action, Community Initiatives and volunteering. It is aligned with the Tata Group Sustainability Policy, and is applicable to all units of Tata Global

Beverages, including associate companies and joint ventures. Through this policy, Tata Global Beverages aspires for global sustainability leadership in the natural beverages sector. The policy states that/Tata Global Beverages is committed to be the most admired natural beverage company in the world by making a big and lasting difference through Sustainability and Corporate Social Responsibility. We shall achieve this by being the consumer''s first choice in sustainable beverage production and consumption/The policy is built around the five pillars of sustainability - community development, sustainable sourcing, climate change, water management and waste management.

In compliance with Section 135 of Companies Act, 2013, Tata Global Beverages has undertaken CSR activities, projects and programs, excluding activities undertaken in pursuance of its normal course of business. The report on CSR activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is given in Annexure 1 forming part of this report. The CSR Policy may be accessed on the Company''s website at the link http://www.tataglobalbeverages.com/docs/default-source/ default-document-libra ry/corporate-social-responsibility-policy/2 14b6881a2368caa65dff02001c5bel.pdf?sfvrsn=0

During the year under review, the Company has spent Rs. 5.53 Crores (around 2.46% of the average net profits of last three financial years) on CSR activities on projects qualifying as per Section 135 of the Companies Act, 2013 duly approved by the CSR Committee.

In addition to the projects specified as CSR activities under Section 135 of Companies Act 2013, the Company has also carried out several other sustainability/ responsible business initiatives and projects on a global scale. In 2015, for the fourth year in a row, Tata Global Beverages (TGB) was recoqnised on the Climate Disclosure Leadership Index (CDLI), and ranked second in India by CDR

Particulars of employees

The Information required under Section 19/ read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure 2 which forms part of this report.

Pursuant to Section 19/ (14) of the Companies Act, 2013 the details of remuneration received by the Managing and Executive directors from the Company''s subsidiary company during 2015-16 are also given in Annexure 2 attached to this report.

Particulars of Loans, Guarantees or Investments by the Company

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in Annexure 3 attached to this report.

Risk Management

The Risk Management Committee of the Board is entrusted with the responsibility to assist the Board in overseeing and approving the Company''s risk management framework. The Company has a comprehensive Risk policy and a Risk Register detailing the risks that the Company faces under various categories like strategic, financial, commercial, operational, IT, legal, regulatory, people, reputational and other risks and these have been identified and suitable mitigation measures have also been formulated. The Risk Management Committee reviews the key risks, the Risk register and the mitigation measures periodically. The Audit Committee has additional oversight in the area of financial risks and control.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules There under for prevention and redressal of complaints of sexual harassment at workplace.

Deposits from public

The Company has not accepted any deposits from the public during the year under review. No amounts on account of principal or interest on deposits from public was outstanding as on 31st March 2016.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Dr. Asim Kumar Chattopadhyay, Company Secretary in Practice, to carry out the Secretarial Audit of the Company. The Report of the Secretarial Audit for 2015-16 is attached herewith as Annexure 4. There are no qualifications in the said report.

Annual Return

As provided under Section 92(3) of the Companies Act, 2013, the extract of annual return in Form MGT-9 is given in Annexure 5 which forms part of this report.

Directors'' Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

(i) In the preparation of the accounts for the financial year ended 31st March 2016, the applicable accounting standards have been followed and that there are no material departures;

(ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 profits of the Company for that period;

(iii) That the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That they have prepared the accounts for the financial year ended 31st March 2016 on a''going concern''basis.

(v) The Directors have laid down internal financial controls for the company which are adequate and are operating effectively.

(vi) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by 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 the financial year 2015-16.

Related Party Transactions

All Related party transactions that were entered into during the financial year were on an arms length basis and in the ordinary course of business. There are no material significant related party transactions made by the Company during the year that would have required shareholder approval under Regulation 23(4) of the Listing Regulations and the erstwhile Clause 49 of the Listing Agreement. All related party transactions are reported to the Audit Committee. Prior approval of the Audit Committee is obtained for the transactions which are planned and/ or repetitive in nature and omnibus approvals are taken within the criteria/ limits laid down for unforeseen transactions. The disclosure under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not applicable. The Policy on Related Party transactions as approved by the Board has been uploaded on the Company''s Website and may be accessed at the link http://www.tataglobalbeverages.com/our-investors/ governance.

The details of the transactions with related parties during 2015-16 are provided in the accompanying financial statements.

None of the Directors had any pecuniary relationship or transactions with the Company during the year under review.

Directors and key managerial personnel

At the Annual General Meeting of the Company held on 26th August 2014, the members had approved the appointments of Mr. Analjit Singh, Mrs. Mallika Srinivasan, Mr.V Leeladhar, Mrs. Ranjana Kumar, Mr. Darius Pandoleand Mrs. IreenaVittal as Independent Directors for a term of five years from 26th August 2014. All the independent directors have given declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of Listing Regulations. In the opinion of the Board, they fulfill the conditions of independence as specified in the Act and the Rules made thereunder and they are independent of the management.

Mr. Cyrus P Mistry retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-election. Brief particulars and expertise of Mr. Mistry together with his other directorships and committee memberships have been given in the annexure to the Notice of the Annual General Meeting in accordance with the requirements of Listing Regulations.

No director or key managerial personnel was appointed or has retired or resigned during the year under review.

Auditors and Auditors'' Report

The Members at the Annual General Meeting held on 26th August 2014, had appointed M/s. Lovelock and Lewes, as the Statutory Auditors for three years subject to ratification by the members each year. The members are requested to ratify the appointment of M/s. Lovelock and Lewes as Statutory Auditors from the conclusion of the fifty third Annual General Meeting till the conclusion of the fifty fourth Annual General Meeting. The Auditors'' report on the financial statements for the year 2015-16 does not contain any qualifications, reservations or adverse remarks.

Cost Auditors

Your Board has appointed M/s. Shome and Banerjee, 5A Nurulla Doctor Lane, 2nd Floor, Kolkata - 700 017 as cost auditors of the Company for conducting cost audit for the financial year 2016-17. The members are requested to ratify the remuneration payable to the Cost Auditors for 2016-17.

Disclosure requirements

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 6 attached to this report.

Concluding Remarks

The Directors wish to convey their appreciation to all of the Company''s employees for their sincere and dedicated services as well as their collective contribution to the Company''s performance.

On behalf of the Board of Directors

Mumbai, Cyrus P Mistry

24th May 2016 Chairman

Mar 31, 2014

The Directors are pleased to submit their fifty first report together with the audited statement of accounts for the year ended 31st March 2014.

1. HIGHLIGHTS - CONSOLIDATED PERFORMANCE

Your Company reported growth in revenues, and a significant increase in consolidated net Profit for the year ended 31st March 2014. Income from operations at Rs. 7,738 crores increased by 5% year-on-year, reflecting good performance in some key markets coupled with favourable foreign exchange translation impact. Operating Profits at Rs 623 crores however declined from previous year attributable to higher spending on brands, increased costs to support scaling up in new ventures and market and competitive pressures in some regions. Group consolidated net Profit at Rs 481 crores registered 29 % increase over the previous year, the increase also reflecting the impact of higher exceptional income and improved performance in some associate companies.

Your Company re-launched some of its key tea and coffee brands with new product variants and packaging supported by powerful marketing programs during the year, which have entailed significant marketing spend.

In a few global markets, we also faced and responded appropriately to some challenging market conditions, particularly on account of commodity price trends in Coffee and significant competitor activity.

In our newest category, water, we continue to witness very good growth of our offerings such as Himalayan, Tata Water Plus and Tata Gluco Plus through NourishCo, our JV with PepsiCo.

Tata Starbucks Limited, the joint venture company with Starbucks made very good progress and has opened 43 stores as at 31st March 2014. Tata Starbucks as of date has presence in 6 cities Â Mumbai, Delhi, Gurgaon, Bangalore, Pune and Chennai. The stores have been performing well and continue to see excellent consumer response.

2. STAND ALONE FINANCIAL HIGHLIGHTS

The Directors now present below the stand alone financial highlights for 2013-14:

Rs. in Crores

2013-14 2012-13

Total revenue 2868 2439

Profit before finance cost, depreciation, 468 351 exceptional items and taxes Deduct:

Finance cost (39) (32)

Depreciation (16) (16)

Profit before exceptional items and taxes 413 303

Exceptional items (net) 172 18

Profit before tax 585 321

Provision for tax (138) (62)

Profit after tax 447 259

Add: surplus brought forward from previous year 565 486

Add: Transfer from debenture redemption reserve 81 -

Amount available for appropriation 1093 745

Proposed dividend (139) (133)

Dividend distribution tax (8) (21)

Transfer to debenture redemption reserve (81) -

Transfer to general reserve (45) (26)

(273) (180)

Retained in Profit and loss account 820 565

3. DIVIDEND

The Directors are pleased to recommend for the approval of the shareholders a higher dividend of Rs. 2.25 per share on the paid-up equity share capital of the Company with respect to the financial year 2013-14. The total outgo on account of dividend, inclusive of taxes, for 2013-14 is Rs. 147 crores which represents a pay-out of 33% of the Company''s stand alone Profits.

4. REVIEW OF SUBSIDIARY AND ASSOCIATE COMPANIES

(i) a. As required under the listing agreement with the stock exchanges the audited consolidated financial statements of the Company incorporating all its subsidiary and associate companies prepared in accordance with applicable Accounting Standards are attached.

b. The Ministry of Corporate Affairs has by its notification dated 8th February 2011 granted a general exemption to companies, as per which, the provisions of Section 212 of the Companies Act 1956 shall not apply in relation to subsidiaries, subject to the fulfilment of certain conditions. Accordingly the consolidated financial statements of the holding company and all subsidiaries duly audited by its statutory auditors have been presented and the individual accounts of each of the subsidiary companies have not been attached.

c. Any shareholder may either ask for a copy or inspect at the registered office, a copy of the audited accounts of the subsidiary companies (where required to be prepared).

(ii) Tata Coffee Limited, your

Company''s subsidiary, recorded a turnover of Rs. 651 crores in 2013-14, a growth of 9% over the previous year. Profit after tax at Rs 107 crores for 2013- 14 is the highest recorded so far in the company. Tata Coffee is committed to growth through quality and continues to participate in domestic and International forums to popularize the company''s Coffee. In the year under review, Tata Coffee won awards as the best exporter of Coffee to the Far East, Russia and CIS Countries, USA and Canada at the Indian Coffee Export Awards. The R&G unit at Kushalnagar has bagged the best Roaster Award in the IICF held in the current calendar year. The Valparai, Nullore, Mylemoney, Gorgolly, Margolly and Gubgul estates of the company have been adjudged as the best for their Arabica and Robusta Coffee. During the year under review, Tata Coffee exported 5,237 MT of Coffee against 4,831 MT in the previous year. Tata Coffee continues to focus on growth through differentiated and premium Coffee. The Company''s expanded capacity for instant Coffee came on stream during the financial year.

The Directors of Tata Coffee Limited have recommended a higher dividend of Rs. 13 per share for the year 2013-14.

(iii) The Eight O''clock Coffee (EOC) brand performed well in USA, with good consumer demand delivering growth in the pod format. However the total income of Eight O''clock Coffee Inc. USA, a subsidiary of Consolidated Coffee Inc. (CCI), in turn a subsidiary of Tata Coffee, recorded a lower total income of Rs. 1,026 crores in 2013-14 against Rs. 1,099 crores in the previous year, under Indian GAAP, attributable to shift in consumer preference towards pods, higher competitive activity and the fact that the company records only the royalty income on sale of pods. During the year, to revitalize the EOC brand, the company invested in a brand re-launch, with new packaging graphics, new blends and a television advertising campaign.

CCI, during the year, divested its stake in a US based functional beverage company, on account of changed market conditions, its performance and significant future funding requirements.

(iv) Tata Tea Extractions, Inc. (TTEI) , the Company''s wholly-owned subsidiary in the USA, which supplies customer specific instant tea products reported net earnings of $ 3.3 million in 2013-14 against $ 2.1 million in the prior year. The operations of TTEI were re-certified under the Global Food Safety Initiatives for food safety compliance as per BRC (British Retail Consortium) standards. The USFDA had also conducted a surprise audit of the facility during the year and approved it for food safety compliance.

(v) Mount Everest Mineral Water

Limited (MEMW), recorded higher revenue from operations of Rs. 26 crores during 2013-14 against Rs. 22 crores in the previous year, driven largely by marginally higher volumes, better realisation and higher service income. In an inflationary environment, MEMW was able to manage its costs which helped in the company reporting a Profit of Rs 2.4 crores for the year as compared to a Profit of Rs. 0.5 crores in the previous year. The JV between Starbucks and your Company have opened up significant volume opportunities for the brand, Himalayan, as an exciting new alternate channel not only in India but also in other advanced markets across the globe. This also enabled Himalayan to be the only brand of water to be served/poured at all Tata Starbucks outlets in India. The first international foray with Starbucks Singapore, has ensured that Himalayan Water is now available across major Starbucks outlets in Singapore. The Company''s partnership with a leading business house in Singapore has also opened up the presence of Himalayan across major retail chains in Singapore.

(vi) The consolidated Income from operations and Profits of Tata Global Beverages Group Limited, UK, under Indian GAAP, which substantially reffects the financial performance of the Tetley business and other international brands, for the year 2013-14 at Rs 3,459 crores was fat as compared to the previous year. Whilst the rupee depreciation had a favourable impact, trading in Tata Gluco Plus to meet consumer needs.

6. TATA STARBUCKS LIMITED

Tata Starbucks Limited reported strong growth as it continued to increase the number of outlets. It currently operates in Mumbai, Pune, Bangalore, Delhi, Gurgaon and Chennai.

7. AMALGAMATION OF MOUNT EVEREST MINERAL WATER LIMITED (MEMW) WITH THE COMPANY

Your Directors at their meeting held on November 12, 2013 approved the amalgamation of MEMW with the Company under a Scheme of Amalgamation under Sections 391 to 394 and other applicable provisions of the Companies Act, 1956. The Scheme is subject to and would become effective on receipt of all requisite approvals. As per the directions of the Hon''ble High Court at Calcutta, a meeting of the shareholders of the Company was held on 4th June 2014, wherein the shareholders have approved with requisite majority, the Scheme of Amalgamation of MEMW with the Company with effect from the Appointed date, viz, 1st April 2013. Additionally, as required under Clause 5.16 of the Securities and Exchange Board of India Circular CIR/ CFD/DIL/5/2013 dated 4th February 2013 and Circular CIR/CFD/DIL/8/2013 dated 21st May 2013, approval to the said Scheme of Amalgamation was also accorded by the majority of the public shareholders by way of postal ballot/e-voting. The Company has since filed the consequential petition for sanction of the Scheme by the Hon''ble High Court at Calcutta. The same is pending.

8. ACQUISITION OF EARTH RULES PTY LIMITED, AUSTRALIA

Your Directors are pleased to report that, subsequent to the end of the financial year, an overseas subsidiary of your Company, completed the acquisition of Earth Rules Pty Limited, Australia. Earth Rules, which operates under the brand name ''MAP'' is engaged in Coffee business, with presence in the R&G Coffee and Coffee in Pods (single service portions) segments in Australia. The investment is in line with the Company''s strategic vision of growing its presence in Australia, and it also helps Tata Global Beverages to expand its portfolio in Australia to include high growth single serve Coffee business.

9. REVIEW OF ACTIVITIES A. The Tea Industry

India''s tea output stood at 1,200 million kgs in 2013 up 73.72 million kgs or 7% over previous year. Over 96% of the additional crop was produced in North India. Export volumes for 2013 stood at 211.86 million kgs, marginally up on 2012 by 3.63 million kgs. Despite the additional crop and therefore domestic retention, prices in 2013 were higher than the previous year. The orthodox variety in the North saw higher levels within the mix mostly due to an increasingly easier trade and demand from Iran. In the South, unexpected weather and uneven overall crop caused temporary crop deficits and significant volatility in prices. Adverse weather during the first flush in North India has resulted in a dearer market. We expect this strength to continue up until the peak quality second flush period post which higher crops and spot supply will allow overall prices to ease.

B. Domestic Branded Tea Operations

Your Company''s marketing and promotional strategy and launching of new products resulted in volume and market share growth over the previous year. Your Company took several initiatives which helped growth across brands and enables going into the next year with a strong momentum. All the national brands performed very well and Tata Tea Premium, Agni and Tetley Green Tea saw good growth. The regional brands also performed very well with a modest growth over last year, mainly due to restage of Chakra Gold and Kanan Devan brands and price increases across products even as competition held on to its prices. Tata Global Beverages continued in maintaining its volume and value leadership position in India.

The Tata Tea Jaago Re campaign has, over the years, become synonymous with ''Awakening'' by addressing serious issues like voting, corruption and positivity. During 2013-14, the focus has been on gender bias against women through the launch of our ''Bade Badlaav Ki Liye Choti Shuruaat'' campaign. A TV ad film was launched on Women''s Day this year featuring Bollywood star Shahrukh Khan. The advertisement appeals to each one to do their "Choti ShuruaatÂ - small yet powerful acts inspired by simply changing one''s mindset. Further to take the thought forward, a new campaign, ''Power of 49'' was launched aiming to encourage women to exercise their right to vote at the next general elections.

The ''Power of 49'' campaign, aims to make it one of India''s largest women-centric awareness campaigns in recent times with intent to reach out to 100 million women. Power of 49, a Jaago Re initiative for women, was launched in August 2013 with an objective to awaken women, who form 49% of India''s voter base, inspiring them to cast an informed and independent vote and exercise the power they have to make or break a government in the forthcoming election. The campaign was conceptualised from the insight that women constitute 49% of the voter base in India but often do not get their due as they are not seen as a determining factor in elections.

Your Company has large presence in rural India through Gaon Chalo, its innovative rural distribution model. This model was initiated in 2005-06 in Uttar Pradesh and is today spread across 18 states through a strong network of NGOs. Gaon Chalo is a non- traditional business model that is Profitable and growing at a very fast pace. The model generates rural opportunities for youth and provides a platform to further the Company''s CSR and Affirmative Action initiatives.

C. International Branded Operations

In the international branded operations, whilst there has been growth in some markets, the trading environment generally remained challenging largely driven by intense retailer activity, competitor pressures and market decline in some categories driven by consumer preferences. We have been proactive in addressing these challenges through innovation, restructuring of businesses and brand re-launches.

The group performed well in markets like Canada, France, Australia, Africa and Middle East. To address changing consumer preferences, the group focussed on growth segments like speciality tea and single serve pod formats.

While black tea in the UK is declining, other categories like premium tea and speciality teas are seeing good growth. The group continues to focus on improving its brand strength and take share in the growing segments. Tetley Black tea bags and Tetley Green tea continue to be number two in their respective categories in UK, whereas Tetley Redbush is a category leader.

The Canadian business had a good year with strong sales and Profitability. Australia had a good year recording sales growth over the prior year. Both these markets saw new product variants being launched during the year under consideration.

In the US, Coffee sales volumes in traditional formats were lower than the prior year mainly driven by growth in consumer preference for Coffee in pods (single serve formats) and also due to competitive intensity in that market. We are present in the single serve format category through EOC K-cups, which recorded strong sales. Both Eight O clock and Grand brands were re-launched during the year with new packaging.

The company continues to focus on category expansion and on improving brand recognition and loyalty for its portfolio of brands

D. Tea Extractions

The Instant Tea Division''s Sales turnover and Profitability improved compared to previous year, mainly on account of favourable foreign exchange and increased production volume. Exports of Instant tea were made largely to US, Europe and Far Eastern Countries.

The Instant Tea Operations achieved the following noteworthy milestones, which will greatly enhance their reach and sustenance of the business in the ever challenging global market:

Â£ FSSC 22000 Certification under the Global Food Safety Initiatives, a globally recognised food safety standard

- Recipient of a globally recognised Ethical Tea Partnership (ETP) standard certification

- Recipient of the prestigious Kerala State Pollution Control Board Award for environment protection & sustainability Zhejiang Tata Tea Extraction Company Limited, China which is a subsidiary of your company, is a Joint Venture with Zhejiang Tea Group Company Limited, China. The JV was set up for the manufacture and marketing of Instant tea, tea polyphenol and tea concentrates. The company commenced its production of green instant tea products after initial delays and has now commenced exports to USA. The company is conducting further trials to produce tea polyphenols under a new technology and improve efciency factors. It is also addressing marketing challenges to enter new geographies.

E. Exports

The FOB value of exports during 2013-14 was Rs. 172 crores, against Rs. 152 crores in the previous year. The tea bag unit at Kochi performed well and exported its products to several markets during the year. The division launched new format of tea bags for the Australian market. The Instant Tea unit performed well and is strengthening its marketing effort by undertaking new customer contacts, identifying sales channel partners and participation in international fairs with a view to meet new customers and understand industry trends.

F. Plantation Operations

The crop production in 2013-14 at our Pullivasal and Periakanal estates at 20.73 lakh kgs was in line with the previous year crop. The productivity achieved by the two estates to end March 2014 was 51.23 Kgs against 47.44 kg achieved for the same period in the previous season.

G. Community Development, Employees'' Welfare and Environment Conservation

Transforming communities through proactive interventions has been an integral part of Tata Group long before Corporate Social Responsibility became a buzz phrase. Across Tata Global Beverages, we have nurtured and encouraged our businesses to proactively engage with the community and champion causes which are real and relevant. Tata Global Beverages undertakes an extremely strategic and well-thought-out exercise to understand the issues faced and the requirements of disadvantaged communities near our operations and take on projects to improve their socio-economic status. The community initiatives are being pursued through the General Hospital, Srishti complex and the High Range School, all based at Munnar in Kerala.

The General Hospital continued to provide quality healthcare which includes free treatment to the Muthavan tribal community. Srishti focuses on enhancing the hidden talents of differently abled children most of whom are the families of local tea pickers of Munnar. The High Range School continues to actively pursue enhancement of academics in the communities around our geographies of operation. Our continuous efforts have borne fruit, and the education style at our High Range School is now recognised as a benchmark in holistic education, at the Group level.

Your Company is committed to its Affirmative Action (AA) initiatives which seek to directly conduct or support initiatives to ensure an equal footing for socially and economically disadvantaged sections in the country at large, and specifically the Scheduled Caste and Scheduled Tribe communities. Towards this, your Company''s efforts on 4E''s (Employment, Employability, Entrepreneurship and Education) are directed at addressing the national cause of ensuring equal opportunities to the historically disadvantaged. Tata Global Beverages ensures prime focus on enhancing health and education across the nation especially across our geographies. AA initiatives in India are driven primarily from Munnar and Bangalore.

In pursuance of its Sustainability initiatives, your Group has identified five strong pillars of sustainability for the future - climate change, water management, sustainable packaging, ethical supply chain and community work. Following a review of the TGB sustainability agenda, the strategic objective for sustainability has been revised and updated as follows: integrating sustainability into our business, innovation processes, products and brands. The focus will be on establishing Global Key Performance Indicators (KPIs) and their deployment across the organisation building it into the DNA of your Company.

Your subsidiary, Tata Coffee, has always been committed to serving the communities where it operates. In this spirit, the company is actively engaging with the local community in Jayamangalam village located near the Theni plant. Initiatives like ''Self-Help Group'' and ''Girl Child Nutrition'' projects are aimed at enabling a better quality of life for women and girl children.

10. HUMAN RESOURCES AND INDUSTRIAL RELATIONS

During the year under review, industrial relations remained generally peaceful at all our offices and establishments.

The HR priorities for the year 2014-15 were finalised as a part of the global HR budgeting process. The priorities included the institution of a global reward & recognition framework and focus on individual, regional, functional and global recognition systems. Your Company has improved its performance management process with focused training workshops for ''people managers''. A revised 360 degree feedback process is planned for the leadership level this year for improving leadership effectiveness.

11. CORPORATE GOVERNANCE AND MDA

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MDA). The MDA also covers the consolidated operations and reflects the global nature of our business.

12. BUSINESS RESPONSIBILITY REPORT

Vide its Circular dated August 13, 2012, Securities and Exchange Board of India (SEBI) mandated the inclusion of Business Responsibility Report (BRR) as a part of the Annual Report for top 100 listed entities based on their market capitalisation on BSE Limited and National Stock Exchange of India Limited, as on March 31, 2012. Pursuant to the above, the Stock Exchanges amended the listing agreement by inclusion of Clause 55 providing a suggested framework of a BRR, describing initiatives taken by the company from an environmental, social and governance perspective. The Company''s BRR is hosted on its website www. tataglobalbeverages.com. Any shareholder interested in obtaining a physical copy of the same may write to the Company Secretary at the Registered Office of the Company.

13. TATA BUSINESS EXCELLENCE MODEL (TBEM)

Progress has been made in implementing suggestions made by the Assessment team in the last assessment. The application for external assessment for 2014 has been submitted in June 2014.

14. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217 (2AA) of the Companies Act, 1956 (''the Act'') and based on the representations received from the operating management, the Directors hereby confirm that:

i) In the preparation of the Annual Accounts for 2013-14, the applicable Accounting Standards have been followed and there are no material departures.

ii) They have selected such accounting policies and applied them consistently and made judgments 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 the financial year.

iii) They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They have prepared the Annual Accounts on a going concern basis.

15. DIRECTORS

During the year 2013-14, Mr. R K Krishna Kumar, Mr. U M Rao and Mr. F K Kavarana stepped down as Directors from the Board of your Company upon reaching the retirement age in keeping with the Tata Group Guidelines on retirement of directors. The Board places on record its deep appreciation to Mr. R K Krishna Kumar, Mr. U M Rao and Mr. F. K. Kavarana for the excellent contributions made by them as Directors.

Mr. J S Bilimoria ceased to be a director consequent to his sad and untimely demise on 3rd May 2013.

As reported last year, Mr. L Krishnakumar was appointed as an additional director and as Executive Director by your Board with effect from 1st April 2013.

Mr. S Santhanakrishnan and Mrs. Ireena Vittal joined the Board as additional directors with effect from 28th May 2013 and 22nd October 2013 respectively.

Mr. Cyrus P Mistry retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-election.

As per Section 149(4) of the Companies Act, 2013, the independent directors of the Company are being appointed to hold office as independent directors for a period of five years with effect from 26th August 2014. Brief particulars and expertise of these directors and their other directorships and committee memberships have been given in the annexure to the Notice of the Annual General Meeting in accordance with the requirements of listing agreement with Stock Exchanges.

16. AUDITORS

The Members are requested to appoint the Auditors and fix their remuneration. Messrs. Lovelock and Lewes, the retiring Auditors have furnished certificate of their eligibility for re-appointment as required under the Companies Act, 2013.

17. COST AUDITORS

The Central Government has approved the appointment of M/s. Shome and Banerjee, 5A Nurulla Doctor Lane, 2nd Floor, Kolkata - 700 017 as cost auditors for the Company for conducting cost audit for the financial year 2013-14. The due date for fling the Cost Audit Report for the financial year ended 31st March 2013 was 30th September 2013 and the Cost Audit Report was filed by the Cost Auditors on 10th September 2013.

18. PARTICULARS OF EMPLOYEES

Information as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this report. However as per the provisions of Section 219(1) (b) (iv) of the Companies Act,1956, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Companies Act 1956. Any member interested in obtaining such particulars may write to the Company Secretary for a copy thereof

19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

20. CONCLUDING REMARKS

The Directors are sure that the shareholders would like to join them in conveying their appreciation to all employees of the Company for their sincere and dedicated services during 2013-14.

On behalf of the Board of Directors

Mumbai, (CYRUS P MISTRY)

16th July, 2014 Chairman

Mar 31, 2013

The Directors are pleased to submit their fiftieth report together with the audited statement of accounts for the year ended 31st March 2013.

1. Highlights - Consolidated Performance

Your Company''s consolidated total operating income for the year ended 31st March 2013, at Rs. 7,351 crores, was 11% higher than the previous year reflecting strong performance in the branded tea and coffee businesses in major markets and excellent performance of the plantation and extraction businesses. Favourable translation impact also contributed to the growth in operating income. In the branded tea business we continue to be market leaders in India and Canada and among the leading brands in other major markets.

Group Profit from operations for the year at Rs. 663 crores is 26% higher than the previous year reflecting strong operating performance in most key markets. Contributing to this performance were improved profitability of branded coffee business, strong performance of the tea business in markets like I ndia and Australia, and favourable impact of cost interventions. The increase in Group Consolidated Net Profit for the year at Rs. 373 crores is 5% higher as compared to the prior year reflecting the improvement in performance offset by the impact of exceptional items.

We are delighted to report that our strategic partnerships with PepsiCo and Starbucks have recorded rapid strides during the year.

NourishCo Beverages, the equal-stake joint venture between Tata Global Beverages Limited and PepsiCo handles a portfolio of three products, the premium water brand Himalayan, Tata Water Plus and Ta ta Gluco Plus. The company is set to launch more innovations in enhanced and functional beverages.

Ta ta Starbucks Limited, the equal-stake joint venture between Starbucks Coffee Company and Tata Global Beverages Limited has rapidly scaled up and opened 12 Starbucks stores during 2012-13 in Mumbai and New Delhi.

Your Company will pursue a strategy of building on its strengths - unique competencies, differentiated offerings, appealing brands and significant scale in the three natural beverage categories of tea, coffee and water to emerge as one of the largest, most admired and successful natural beverage companies in the world.

2. Stand alone Financial Highlights

The Directors now present below the stand alone financial highlights for 2012/13:

Rs. in Crores

2012-13 2011-12

Total Revenue 2,439 2,129

Profit before finance cost, depreciation, exceptional items 351 326 and taxes Deduct:

Finance cost (32) (27)

Depreciation (16) (48) (12) (39)

Profit before exceptional items and taxes 303 287

Exceptional items (net) 18 83

Profit before tax 321 370

Provision for tax (62) (67)

Profit after tax 259 303

Add: surplus brought forward from previous year 486 367

Amount available for appropriation 745 670

Proposed dividend (133) (133)

Dividend distribution tax (21) (21)

Transfer to general reserve (26) (30)

(180) (184)

565 486

3. Dividend

The Directors are pleased to recommend for the approval of the shareholders a dividend of Rs. 2.15 per share on the paid-up equity share capital of the Company with respect to the financial year 2012-13 which is the same dividend that was declared last year. The total outgo on account of dividend, inclusive of taxes, for 2012-13 is Rs. 154 crores which represents a pay-out of 59% of the Company''s stand alone profits against the payout of 51% in the previous year.

4. Review of Subsidiary and Associate Companies

(i) a. As required under the listing agreement with the stock exchanges the audited consolidated financial statements of the Company incorporating all its subsidiary and associate companies prepared in accordance with applicable Accounting Standards are attached.

b. The Ministry of Corporate Affairs has by its notification dated 8th February 2011 granted a general exemption to companies, as per which, the provisions of Section 21 2 shall not apply in relation to subsidiaries, subject to the fulfillment of certain conditions. Accordingly the consolidated financial statements of the holding company and all subsidiaries duly audited by its statutory auditors have been presented and the individual accounts of each of the subsidiary companies have not been attached.

c. Any shareholder may either ask for a copy or inspect at the registered office a copy of the audited accounts of the subsidiary companies (where required to be prepared).

(ii) Tata Coffee Limited, your Company''s subsidiary, recorded excellent performance in 2012-13 registering growth in both top line and bottom line. Tata Coffee''s income from operations for the year 2012-13 at Rs. 598 crores was 18% higher than the previous year. Profit before exceptional items and taxes for the year ended 31 st March, 2013 was Rs. 141 crores against Rs. 96 crores in the previous year, representing an increase of 47% driven by excellent performance of the plantation activities and the Instant coffee operations. Profit before Ta x at Rs. 131 crores grew 26% over the previous year. The Profit earned by Ta ta Coffee in 2012-13 has been the highest in the history of the Company. The Directors ofTa ta Coffee Limited have recommended a final dividend of Rs. 7.50 per share which was in addition to an interim dividend of Rs. 5 per share thus resulting in a total dividend of Rs. 12.50 per share for the year 2012-13 against Rs. 11 per share in the previous year.

The instant coffee operations of Tata Coffee demonstrated sustenance of process centric approach with effective operational discipline. The prime focus was on consistent quality, customer centric initiatives a nd work force development. The division achieved record capacity utilisation across all product variants. The Instant coffee units of Tata Coffee are certified by FSSAI (Food safety standards authority of India), ISO 9001 and 22000:2005, Kosher (Toopran), Halal and SA - 8000 (Theni). The Theni unit won the certificate of appreciation from Ministry of Commerce and Industry, Govt. of India for highest growth in exports amongst the manufacturing units (TN and Pondicherry) for the year 2011-12.

In a key partnership milestone between Starbucks Coffee Company and Ta ta Coffee Limited, a roasting and packaging plant was inaugurated in Kushalnagar in Coorg, Karnataka in February 2013. This world-class facility enables roasting and packaging of green coffee beans for Starbucks stores in India.

(iii) Eight O''clock Coffee Company, USA, (EOC) a subsidiary ofTa ta Coffee, had a very good year recording significant increase in operating profits aided by lower coffee prices, prudent cost management and improved efficiencies. The business launched Eight''O Clock K-cups under a trademark licensing agreement with Keurig, which has been well received by consumers and are achieving distribution gains. Consequently Ta ta Coffee also reported a significant improvement in its consolidated performance.

(iv) Our B2B operations in USA, Tata Tea Extractions Inc, the Company''s wholly-owned subsidiary, which supplies customer specific products in the beverage industry reported higher operating earnings of Rs. 10 crores in 2012-13 compared with Rs. 6 crores in the previous year. Net earnings after tax increased to Rs. 12 crores in 2012-13 against Rs. 9 crores in the previous year. The increase in earnings was driven by favorable product mix, better price realisation and lower input cost.

(v) Mount Everest Mineral Water Ltd. (MEMW), the Company''s subsidiary, recorded higher revenue from operations in 2012-13 at Rs 22 crores against Rs. 19 crores in the prior year driven by higher volumes in the premium Himalayan brand and better realisations. In a highly inflationary environment, MEMW embarked on several initiatives aiming at cost optimisation resulting in reporting a profit of Rs. 0.54 crores against a loss of Rs 1.64 crores in 2011-12. As earlier reported, your Company acquired an additional 4.98% equity in MEMW during the year under review thus taking its holding in MEMW to 50.07%. MEMW is also focusing on export opportunities including enhanced distribution through its joint venture partners.

(vi) The consolidated Operating Income ofTa ta Global Beverages Group Limited, UK which substantially reflects the financial performance of the Tetley business and other international brands for the year 2012-13 was Rs. 3,440 crores, an increase of 7% over the prior year. Profit before exceptional items and taxes at Rs. 246 crores registered a 7% increase over 2011-12. Profit before and after tax at Rs. 263 crores and Rs. 225 crores respectively were also higher than the previous year. The increase in profitability is attributable to cost savings initiatives and improved performance in some markets and currency translation.

(vii) Estate Management Services Pvt. Limited, Sri Lanka (EMSPL), in which your Company owns 49% of the shares, is the holding company of Watawala Plantations Ltd. (WPL). EMSPL is one of the largest producers of tea and palm oil in Sri Lanka and amongst the most efficiently run in that country. Its marketing company, Watawala Tea Ceylon Ltd. (WTC) owns three key brands - "Zesta", " Watawala Kahata", and "Ran Tea" which together command over 30% market share of the branded tea market in Sri Lanka. Sri Lankan tea has good acceptance in several countries including Russia, South East Asia, Australia and the Middle East. The EMSPL group achieved record turnover and earnings during 2012-13 aided by one of the highest ever performance of WPL as well as consistent growth of WTC.

(viii) The turnover of Amalgamated Plantations Private Limited (APPL), in which the company owns a 49.66% stake, was Rs. 512 crores which was higher than in the previous year attributed to increased sales volume and better realisations. Profit after tax at Rs. 24 crores was significantly higher than prior year''s profit of Rs. 11 crores largely due to better realisations.

APPL''s growing focus on being ''environmentally aware'' resulted in converting its Hathikuli tea estate into an organic estate. This was appreciated by Sanctuary Asia Magazine at an award function held on 30th November 2012, at the National Centre for Performing Arts (NCPA), Mumbai. APPL was awarded the ''Wind under the Wings''in recognition of its inspiring contribution towards environment. APPL''s Hathikuli Tea Estate is now the largest Certified Organic integrated Farm in Asia manufacturing three varieties of tea and black pepper. In the process, the health of the tea bushes enhanced significantly; pepper yields are rising and soil biodiversity is greater than before. The benefits also include improved health of the workforce.

(ix) Kanan Devan Hills Plantations Private Limited (KDHP) in which your Company increased its stake to 28.92% during the year, had a reasonably good 2012-13 on the crop front with production of 20.23 million kgs against the previous year crop of 19.14 million kgs. Production could have been higher but for the dry weather that prevailed during the last quarter of the financial year under review. The price of tea during the year remained firm and towards the end of the financial year, owing to all-round drop in production peaked to levels never seen in the past. Prices have however since begun to soften.

KDHP recorded a profit after tax of Rs. 12 crores compared to Rs. 3 crores in the previous year. Operational results would have been substantially better but remained subdued due to full year impact of the steep increase in the wage rates that came into effect at the end of the previous financial year, almost doubling of fertiliser costs, and steep increase in power costs. Outlook for KDHP in the current year is cautiously optimistic.

5. NourishCo Beverages Limited - Joint Venture in Liquid Beverage Business 2012-13 is the third year of operations of NourishCo Beverages, the Joint Venture with PepsiCo formed to handle the sales, marketing and distribution of Himalayan natural mineral water and other water products through the PepsiCo distribution network. This significant partnership has enabled a higher visibility and availability of Himalayan across channels and markets.

NourishCo''s full portfolio of products comprising Himalayan, Tata Water Plus (TWP) in Pet / Pouch format and Ta ta Gluco Plus (TGP) have made good progress . Sales volumes of Himalayan have grown during the year attributable to robust distribution and launch of various print media and TV commercials. Himalayan today is widely distributed and available in major niche markets across India. TWP expanded its reach and distribution significantly during the year. The brand is now available in Tamil Nadu and Andhra Pradesh. During the year, TWP was also relaunched by NourishCo in new packaging with an appealing marketing campaign. Tata Gluco Plus, a glucose based drink is now available in three exciting flavours - lemon, orange and mango.

We are happy to report that Tata Water Plus, the country''s first nutrient drinking water, was the Official Hydration Partner for the 18th edition of the Aircel Chennai Open Tennis Tournament held in January 2013. Tata Water Plus fulfilled the hydration requirements of a large number of people during the event.

6. Tata Starbucks Limited

Your Company has always believed in creating memorable beverage experiences for consumers. The joint venture with Starbucks is yet another strong expression of this belief. Through Ta ta Starbucks, your Company offers the legendary Starbucks coffee experience, backed by the trust of the Ta ta name, to Indian consumers. The unique flagship stores are owned and operated by the joint venture and branded as "Starbucks Coffee - A Ta ta Alliance". During the year, Tata Starbucks have opened 12 stores in Mumbai and New Delhi.

Starbucks stores offer an extensive product portfolio that includes Starbucks signature espresso-based beverages, as well as Starbucks VIA Ready Brew and Starbucks Reserve coffees. The store will also offer Ta ta Tazo tea and Himalayan mineral water, and its broad food offering boasts a wide selection ofWestern favorites, as well as locally relevant flavours. In addition, there is a wide range of Starbucks merchandise and free Wi-Fi so customers can enjoy the unparalleled coffeehouse experience that Starbucks is known for globally

Deepening its commitment to community, Tata Starbucks Limited will work to improve the lives of coffee growing communities in the State of Karnataka. The joint venture, will work to support ''Swastha'', a school for children with special needs (in partnership with the Coorg Foundation). Additionally, Tata Starbucks Limited will work on initiatives including the promotion of responsible agronomy practices and training of local farmers, technicians and agronomists to improve their coffee-growing and milling skills.

7. MoU with Kerala Ayurveda Limited

Following the MoU signed with Kerala Ayurveda Limited (KAL) to develop beverage and food products around ayurvedic recipes, the Company and KAL are currently engaged in a collaborative Joint development effort towards researching and development of formulations for application in beverages and water categories, aimed at improving health and wellness.

8. Marketing Alliance with SIGCC

Your Company has forged a marketing alliance with South Indian Green Cardamom Company (SIGCC) for the launch of their first branded product ''Spice Mist.''SIGCC is a company founded, managed and run by the growers of spices themselves. Spice Mist has been launched in two varieties- cardamom and pepper. It is the first nationally branded whole spice in the Indian market. The products have been test marketed in a few cities. Through this alliance, SIGCC can sell Spice Mist through Tata Global Beverages''wide distribution network. This will enable the spice growers to get a better price for their products by selling directly to the consumer instead of through intermediaries. This alliance represents yet another move by your Company to add value to India''s plantation community.

9. Review of Activities

A. The Tea Industry

India''s tea output stood at 1,112 million kgs in 2012 against 1,116 million kgs in 2011. The drop in crop was led by South India. Consumption increased by 1.9% to 890 million kgs in 2012 versus 873 million kgs in 2011 resulting in lower inventories. As a result tea prices strengthened, increasing by Rs. 18 /kg over 2011. The outlook for 2013-14 is for prices to be fully firm to dearer if crop intakes follow seasonal norms.

Tea Exports from India declined by 14 million kgs in 2012 mainly due to the higher price levels with teas from other origins looking more attractive price-wise. Import of tea into India in 2012 was only marginally lower than the previous year.

B. Domestic Branded Tea Operations

Branded operations continued its excellent performance ending the year 2012-13 with a 7% growth over the previous year in volume and 16% by value. The national brands recorded a 7% growth over the previous year. All the national brands performed well, in spite of significant price increases taken on all the brands in view of increased commodity cost, and notwithstanding the fact that some competitor brand held onto constant consumer prices in the first quarter and moved prices up only thereafter.

The Regional brands also performed well, registering good growths over last year led mainly by Chakra Gold and Kanan Devan which recorded impressive growth during the year.

Your Company maintained its volume and value leadership position with a MAT volume and value share of 20.5% and 22.2% respectively, well ahead of its major competitors.

Tata Tea established itself as a thought leader in the tea category in India by positioning tea as a medium for social awakening through the Jaago Re campaign. Jaago Re helped build a differentiated positioning for brand Ta ta Tea - while tea may wake you up, Tata Tea awakens you! The campaign has continuously evolved, from the time it was launched in 2007. However the common thread underlying the success of its various avatars is Jaago Re''s ability to identify social trends long before they become fully evident and call out to the nation to awaken to it. Since inception the Jaago Re campaign has won various laurels and recognitions. Tata Tea achieved volume leadership of the branded tea category towards the end of 2007 and value market leadership in 2011. This makes Jaago Re a campaign which delivers strong business results while doing social good through its overall message.

Tata Tea''s Jaago Re campaign won the ''Cause Marketing Campaign'' a ward at the Forbes India Philanthropy Awards (FIPA) 2012. FIPA announced ten awards for people and organisations who have been change makers, innovators and executors in the field of philanthropy. The award is in recognition of the Jaago Re campaign''s success in integrating ''cause'' with '' brand.''

A new Jaago Re campaign featuring Shah Rukh Khan was launched in record time in the month of March to coincide with International Women''s day and more importantly tap the sentiment of the nation towards women. With a strong call for a ''choti shuruaat'' towards putting women first, we believe this will go a long way in highlighting this important social cause, and also strengthening the equity of the brand.

The Gaon Chalo initiative aimed at promoting distribution in the rural areas has been a special initiative undertaken by your Company and has been very successful over the years. The initiative commenced about 5 years ago and has made rapid progress. The core of the solution to enhance rural penetration was to create synergies among the local communities, in particular tying up with Non Government Organisations (NGO) who are well established in most villages across the country. The Gaon Chalo initiative currently covers many states across the country.

C. International Branded Operations

The UK market witnessed decline in volumes in the backdrop of decline in black tea category, increased competitive intensity and a shift in consumer behavior. However growth in green tea and specialty teas continues to be strong. Tetley recorded growth in green tea volumes as well as Redbush variety driven by a combination of focus on specific market segments, good merchandising efforts and the effect of new marketing campaigns. Your Group increased its investment behind brands to support volumes and this strategy has helped in the growth in green teas and other specialty teas. Difficult trading environment prevailed in Europe due to competitive intensity. Your Group is in the process of restructuring its business model in certain geographies with a view to improving margins.

Profitability of the US operations was significantly higher than the prior year driven by lower coffee cost, effective cost management and royalty income under the licensing arrangement with Keurigs for the coffee - pods. During 2012-13, Eight O Clock Coffee (EOC) launched coffee-pods (K-cups) to fit in existing Keurig brewers for the US market, as part of a licensing deal with Green Mountain Coffee Roasters Inc. EOC K cups have met with good market response.

Canadian tea business was impacted by competitive intensity and restructuring of distribution. Trade activation programmes were implemented to support incremental activities and regain volumes. The region implemented price increases in all major accounts under difficult and competitive market conditions. The Canadian business launched Tetley tea pods (T-Discs) for the Ta ssimo brewing system as part of a licensing deal with Kraft.

Australia had a good year with an improvement in the underlying income and profit from operations over the prior year driven by strong distribution performance and consumer programmes coupled with successful new products launched last year, namely the new Chai Latte and Specialty products . The business continues to invest behind brands to protect black tea volumes and support new product launches in the market in categories like speciality teas and Chai Latte.

In Pakistan, the business introduced Tetley Gold with an improved blend, in two select regions. The consumer response to the product has been very encouraging.

To commemorate 175 years of the iconic Tetley brand, the UK''s first tea table book titled ''You, me and a cup of tea'' was created by Tetley in partnership with CLIC Sargent, UK''s leading children and young people''s cancer charity. The book features a unique collection of 175 memorable teatime stories from celebrities, Tetley Tea fans and tea drinkers from across UK. Young people and their families affected by cancer, who have been supported by CLIC Sargent, have shared their stories in the book as well and all proceeds from the sales of the book will go to the charity.

D. Tea Extractions

The division''s operations were stable and exports of I nstant tea were made largely to US, Europe and Far Eastern countries. Profitability of the division improved during the year driven by improved realisation due to favourable foreign exchange. The Food Safety Management system of the division has been recommended for FSSC 22000 certification by Bureau Veritas, the certification agency. This certificate is globally recognised under the Global Food Safety Initiative (GFSI) and is a key consideration for procurement by many of the customers in USA, Europe, Japan etc.

Zhejiang Ta ta Tea Extraction Company Limited, China which is a subsidiary of your company, is a Joint Venture with Zhejiang Tea Group Company Limited, China. The JV was set up for the manufacture and marketing of Instant tea, tea Polyphenol and tea concentrates. The company commenced its production of green instant tea products after initial delays and has now started trial exports to USA. The trial commercial production of green Tea Polyphenols commenced during the current year, with the first order to be dispatched during the early part of the next fiscal.

E. Exports

The FOB value of exports during 2012-13 was Rs. 152 crores, against Rs. 157 crores in the previous year. The tea bag unit at Kochi performed well and exported its products to new markets of Nigeria, US and Sri Lanka. The Instant Tea unit is working with the commercial team to develop SKUs for new markets. The Export Credit Guarantee Corporation (ECGC) of India has recognised your Company as the 3rd most valued exporter client of the ECGC Kochi branch.

F. Plantation Operations

The crop production in 2012-13 at our Pullivasal and Periakanal Estates was marginally higher in 2012-13 at 20.73 lakh kgs against 20.62 lakh kgs in the previous year. The yield achieved was also higher than the previous year by 1%. Productivity at 50.06 kgs in 2012-13 was however lower at the two estates compared to the previous year due to unfavourable weather conditions. The year 2012-13 started with drought in the region and although the estates received some rainfall later, it was not adequate to help improve crop growth and productivity.

G. Community Development, Employees'' Welfare and Environment Conservation

Your Company continues the legacy of giving back to society through its focus on community development and social welfare initiatives, particularly through its engagement with, the General Hospital, Srishti Welfare Centre and High Range School, in Munnar.

The General Hospital continued to provide quality healthcare which includes free treatment to the Muthavan tribal community. The hospital now also has a visiting Ophthalmologist and Orthopedic Doctor thereby ensuring easy access and higher availability of basic investigatory and interventional facilities in the locality.

The High Range School is functioning smoothly with CCE (Continuous and Comprehensive Evaluation) being actively pursued as a part of routine curriculum. CBSE Class XII and X Results have been consistently good a nd the fi rst two toppers in the Class XII examinations last year are children of general workers of KDHP and your Company. We are also providing scholarship for university education to the workers children along with entrance coaching for Plus Two Science-stream students.

The Srishti Welfare Centre runs various programmes for the education, training and rehabilitation of children and young adults with special needs. The centre now comprises of 5 units - The DARE School, DARE Strawberry Unit, Athulya, Aranya and The Deli. Trainees and Programme coordinators of each unit were given opportunities to increase their knowledge and functional skills by interacting with welfare units outside their region. The unit also participated in exhibitions, national and international, where their products received much appreciation. Through Srishti the Company has helped these people become productive and respected members of the community.

Your Group has a clear focus and strategic approach towards driving Affirmative Action (AA) in India. In pursuance of this initiative, your Company is committed to directly conducting and supporting initiatives for socially and economically disadvantaged sections in the country at large, and specifically the Scheduled Caste and Scheduled Tribe communities in India. The AA initiative revolves around the four Es - Employment, Employability, Entrepreneurship and Education. As part of the initiative, your Company in collaboration with the renowned Bangalore based NGO, Unnati, sponsored 52 students from Scheduled caste and Scheduled Tribe communities who have been trained in technical skills and are now employed in various companies. The NGO provides skill building in the areas of retailing, hospitality, front office, Information Technology, etc.

The model of entrepreneurship follows inclusive growth by partnering with the rural communities, which include AA community. Gaon Chalo initiative has provided financial stability and growth to the economically backward communities and at the same time expanded the reach of our brands.

Munnar in India has long been the hub of your Company''s education initiatives in India. At the High Range School, the workers''children from both KDHP and your Company are given free and subsidised education, irrespective of their community. Apart from the High Range School, the company undertakes special education through Project DARE.

10. Human Resources and Industrial Relations

During the year under review, industrial relations remained generally peaceful at all our offices and establishments.

Our focus on attracting and nurturing talent and developing capabilities has remained sharp during the year, preparing the business for future growth. One of the development initiatives highlighted within the Organisation Resource Review Process (ORR) was influencing and networking. A global two day program was developed and piloted in the EMEA (Europe, Middle East & Africa) region. A further program was also conducted in the US in March this year. In addition we are also developing a senior leadership module for Influencing and networking.

11. Corporate Governance and MD and A

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MDA). The MDA also covers the consolidated operations and reflects the global nature of our business.

12. Tata Business Excellence Model (TBEM)

Your Group was assessed under the Tata Business Excellence Model on a consolidated basis for the second successive year in 2012-13. The group has achieved a n overall improvement in score in the a ssessment done in 2012-13. The external assessment team shared their findings on the Group''s TBEM assessment with your senior management team in early February 2013, and this was also tabled to the Board of Directors, alongwith an action plan for the future. The feedback from the assessment gives us an opportunity to understand our strengths and areas for improvement. This also serves as a means to learn, manage and improve organisational performance, as we drive towards excellence in all parts of our business.

13. Directors'' Responsibility Statement

Pursuant to the requirement of Section 217 (2AA) of the Companies Act, 1956 (''the Act'') and based on the representations received from the operating management, the Directors hereby confirm that:

i) In the preparation of the Annual Accounts for 2012-13, the applicable Accounting Standards have been followed and there are no material departures.

ii) They have selected such accounting policies and applied them consistently and made judgments 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 the financial year.

iii) They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They have prepared the Annual Accounts on a going concern basis.

14. Directors

During the year Mr. R N Ta ta stepped down as Director and Chairman of the Board of your Company upon his reaching the retirement age in keeping with the Tata Group Guidelines on retirement of directors. Mr. Tata in his long association of over 21 years, had led the Company with great distinction, providing guidance and direction, in its quest for growth and excellence. Mr. Tata''s deep involvement in the Company''s affairs and his outstanding leadership helped overcome several challenges which the Company went through during this period. In matters connected with various aspects of the Company''s strategy and operations, Mr. Ta ta had provided significant direction and guidance which enabled the company to transform from an Indian tea company into a global beverages Company focused on natural beverages.

Mr. Cyrus Mistry was appointed to the Board of your Company as Director on 22nd June 2012 and later was also appointed as Chairman of the Board on 20th November 2012. Mr. Mistry has assumed the leadership of the Company at a historic moment, and his taking over as Chairman will help bring in a fresh new perspective in guiding the Company towards new horizons of achievement.

As an expression of its sincere admiration and acknowledgement of the visionary leadership provided by Mr. Tata and to also mark the occasion of Mr. Cyrus Mistry taking over as the Chairman of the Board, your Company has instituted two Annual Scholarships at the High Range School, Munnar, one to mark Mr. Tata''s stepping down and the other to mark Mr. Mistry assuming the Chairmanship. These will be called as "The Ratan Ta ta and Cyrus Mistry Scholarship" a nd will be awarded to two top ranking students of the school, who are children of plantation workers, for pursuit of a professional undergraduate college education.

Mr. Arun Gandhi stepped down as Director with effect from 15th March, 2013 upon his reaching the retirement age in keeping with the Tata Group Guidelines on retirement of directors. Mr. Gandhi played an active and key role in several acquisitions undertaken by the Company, and also participated actively in various deliberations of the Board of Directors, including those relating to strategy, financial and operational controls. Your Directors wish to record their sincere appreciation for the advice and guidance provided by Mr. Gandhi during his tenure as a Director.

As reported last year, Mr. P. T Siganporia retired as Director and Managing Director of the company with effect from 30th June 2012 and Mr. Harish Bhat took over as the Managing Director with effect from 1 st July 2012.

Mr. L Krishnakumar was appointed as an additional Director and as Executive Director by your Board with effect from 1st April 2013. Mr. L Krishnakumar has been associated with the Tata Group since 2000 - initially with The Indian Hotels Company Limited as its Vice President - Finance and since 2004, he has been with the Company as the Group Chief Financial Officer. The appointment and remuneration of Mr. L Krishnakumar will come up for approval of the members at the forthcoming Annual General Meeting Mr. L Krishnakumar is a Chartered Accountant and has also obtained professional qualifications in Cost Accountancy and Company Secretarial Services and has over 30 years experience in a variety of industries including consumer goods, hotels, manufacturing and consulting. Mr. L Krishnakumar is also a Director on the Board of several overseas subsidiaries of your Company.

Mr. S Santhanakrishnan was appointed as an additional Director by your Board with effect from 28th May 2013. Mr. S Santhanakrishnan, FCA is the partner of PKF Sridhar & Santhanam, Chartered Accountants and has more than 30 years of experience in Finance, Accounts including IFRS, Strategy & Planning, Global Assurance, Corporate laws and Consulting. He is a member of the Central Council of the Institute of Chartered Accountants of India (ICAI). He is actively involved in numerous industry oriented initiatives of the Reserve Bank of India and the Ministry of Corporate Affairs. The appointment of Mr. S Santhanakrishnan will come up for approval of the members at the forthcoming Annual General Meeting.

Mr. F K Kavarana, Mrs. Ranjana Kumar and Mrs. Mallika Srinivasan retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election.

Brief particulars and expertise of these Directors and their other directorships and committee memberships have been given in the annexure to the Notice of the Annual General Meeting in accordance with the requirements of listing agreement with Stock Exchanges.

All these directors have filed Form DD-A with the Company as required under the Companies (Disqualification of Directors under Section 274(1)(g) of the Companies Act, 1956) Rules, 2003.

Your Directors are deeply distressed to report the sad and untimely demise of Mr. J S Bilimoria on 3rd May 2013. Mr. Bilimoria joined the Board of your Company in January 2009 and was also the Chairman of the Audit Committee since January 2010. Mr. Bilimoria made significant contributions to the deliberations at both the Board and Audit Committee meetings as well as at other Committees of the Board of which he was a member. We offer our condolences to Mrs. Bilimoria and her other family members on this tragic and untimely loss.

15. Auditors

The Members are requested to appoint the Auditors and fix their remuneration. Messrs. Lovelock and Lewes, the retiring Auditors have furnished certificate of their eligibility for re-appointment as required under the Companies Act, 1956.

16. Cost Auditors

The Central Government has approved the appointment of M/s. Shome and Banerjee, 5A Nurulla Doctor Lane, 2nd Floor, Kolkata - 700017 as cost auditors for the Company for conducting Cost Audit for the financial year 2012-13. The due date for filing the Cost Audit Report for the financial year ended 31st March 2012 was 31st January 2013 and the Cost Audit Report was filed by the Cost Auditors on 27th December 2012. The due date for filing the Cost Audit Report for the financial year ended 31st March 2013 is 30th September 2013.

17. Particulars of Employees

Information as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this report. However as per the provisions of Section 219(1) (b) (iv) of the Companies Act,1956, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Companies Act 1956. Any member interested in obtaining such particulars may write to the Company Secretary for a copy thereof

18. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

19. Concluding Remarks

The Directors are sure that the shareholders would like to join them in conveying their appreciation to all employees of the Company for their sincere and dedicated services during 2012-13, without which such commendable performance would not have been possible in a relatively challenging global environment.

On behalf of the Board of Directors

Mumbai, (CYRUS P MISTRY)

28th May, 2013 Chairman

Mar 31, 2012

The Directors are pleased to submit their report together with the audited statement of accounts for the year ended 31st March, 2012.

1. Highlights - Consolidated Performance

The global operating environment remained challenging during 2011/12 with high competitive intensity in the branded space across key regions due to intense promotional activity, high commodity costs and a volatile exchange market. Your Group continued to constantly strive to meet these challenges with a focus on category expansion, innovation and cost reduction and performed well in a difficult external environment. Consolidated Income in 2011/12 increased by 10% from Rs. 6,003.17 crores to Rs. 6,631.16 crores driven largely by improvements in both branded and non-branded businesses and favourable currency impact. Profit before exceptional items at Rs. 551.08 crores was higher by 14% reflecting an improvement in operations and a reduction in finance costs. Post exceptional items Profit after tax at Rs. 431.91 crores recorded a higher growth of 48% over 2010/11 due to favourable impact of higher exceptional income and lower effective tax rate. Group consolidated income after minority interests at Rs. 356.14 crores was 40% higher than the previous year.

The Group recognises that strong brands are critical to sustainable growth and we continue to invest in our brands and new product development which are essential to preserve the long term health of our brands and support future growth. Strategic alliances are also a key pillar of our growth strategy and joint ventures with established global players are a step in this direction. A strategic review of the cost base has been completed with the help of external advisors which are expected to deliver benefits.

2. Stand alone Financial Highlights

The Directors now present below the stand alone financial highlights for 2011/12:

Rs. Crores

2011/12 2010/11

Total Revenue 2,129 1,924

Profit before finance cost, depreciation, exceptional items and tax 326 260 Deduct:

Finance cost (27) (41)

Depreciation (12) (39) (12) (53)

Profit before tax and exceptional items 287 207

Exceptional items (net) 83 23

Profit before tax 370 230

Provision for tax (67) (50)

Profit after tax 303 180

Add: Surplus brought forward from previous year 367 347

Transfer from debenture redemption reserve - 81

Amount available for appropriation 670 608

Proposed dividend (133) (124)

Income tax on dividend (21) (18)

Transfer to general reserve (30) (18)

Transfer to debenture redemption reserve (184) (81) (241)

486 367

The Company had a spectacular year, growing significantly over the previous year and establishing market leadership in both volume and value. This was due to a realignment of the marketing mix, focus on distribution and the impact of brand investment as demonstrated by the Tata Tea Premium and Tata Tea Gold marketing campaigns. These campaigns resonated well with the consumers and increased brand pull.

Total Revenue for the year ended 31st March 2012 was Rs. 2,129.38 crores against Rs. 1,924.08 crores in 2010/11, registering an increase of 11% driven by higher volumes across all brands and improved price realisation. Improved operating performance along with cost rationalisation initiatives and debt restructuring enabled the Company to improve its Profits. The Company also benefitted from exceptional items. Profit before and after tax at Rs. 369.91 crores and Rs. 302.68 crores respectively reflect an increase of 61% and 68% respectively over the previous year.

Dividend

The Directors are pleased to recommend for the approval of the shareholders a dividend of Rs. 2.15 per share on the paid-up equity share capital of the Company with respect to the financial year 2011/12 as compared with the dividend of Rs. 2 per share declared last year. The total outgo on account of dividend, inclusive of taxes, for 2011/12 is Rs. 153.65 crores which represents a pay-out of 51% of the Company's stand alone Profits.

Review of Subsidiary and Associate Companies

(i) a. As required under the listing agreement with the stock exchanges the audited consolidated financial statements of the Company together with all its subsidiary and associate companies prepared in accordance with applicable Accounting Standards is attached.

b. The Ministry of Corporate Affairs has by its notification dated 8th February 2011 granted a general exemption to companies, as per which, the provisions of Section 212 shall not apply in relation to subsidiaries, subject to the fulfillment of certain conditions. Accordingly the consolidated financial statements of the holding company and all subsidiaries duly audited by its statutory auditors have been presented and the individual accounts of each of the subsidiary companies have not been attached.

c. Any shareholder may either ask for a copy or inspect at the registered office a copy of the audited accounts of the subsidiary companies (where required to be prepared).

(ii). Tata Coffee Limited (TCL), a subsidiary of the Company, as a standalone entity registered record turnover and earnings for the year 2011/12 aided by improved performance of its Instant Coffee division and continued growth in the plantation division. TCL reported a turnover of Rs. 509 crores, a growth of 27% over the previous year. Profit before tax grew 52% at Rs. 104 crores and Profit after tax at Rs. 79 crores was up by 43% compared with the previous year. The Instant coffee division reported a dramatic turnaround as a result of the successful process-centric business transformation that focused on consolidation and growth. A customer focused approach, continued quality improvements, engaged work force and focus on a safe working environment have been propellers of the Instant Coffee division's sustained excellence. The company's focus on the premium segment for speciality and certified Coffees resulted in 28% increase in sales volumes over the previous year. The Company targeted the US market for its Robusta coffee significantly increasing volumes. The triple certifications of Rainforest, UTZ and SA8000 helped the Company enhance its presence in the premium market for differentiated coffees. The Directors of Tata Coffee Limited have recommended an all time high dividend of Rs. 11 per share.

(iii). Eight O'Clock Coffee Company, USA, (EOC) a subsidiary of Tata Coffee, performed well in a challenging year registering a 9% growth in turnover at Rs. 1,040 crores over 2010/11 driven by price increases partially offset by lower volumes resulting from intense competitor activity. Profit was however lower in underlying terms, to the prior year, due to increase in commodity costs and higher promotional expenses.

(iv). Tata Tea Extractions Inc, the Company's wholly-owned subsidiary in the USA, reported operating earnings of $ 1.36 million in 2011/12 compared with $ 0.98 million in the previous year. Net earnings after tax increased to $ 1.81 million in 2011/12 against $ 1.64 million in the previous year. The increase in earnings was largely on account of lower input costs.

(v). Mount Everest Mineral Water Ltd (MEMW), the Company's subsidiary, recorded a higher operating income aided by higher service income. During the year, significant measures were taken by MEMW to contain its corporate costs and consequently, the loss decreased by 86% from Rs. 1,185 lakhs in the previous year to Rs. 164 lakhs in the year under review. During the year, your Company consolidated its holdings in MEMW by acquiring 4.17% stake from the erstwhile promoters. An additional 4.98% equity was acquired during the current year consequent to the exercise of a put option by the erstwhile promoters of MEMW. With these acquisitions, your Company's holding in MEMW is currently at 50.07%.

(vi) The consolidated accounts of Tata Global Beverages Group Limited reflect substantially the financial performance of the Tetley business and other international brands. Operating income at Rs. 3,208 crores was up 5.5% over the previous year. Profit before exceptional items at Rs. 231 crores registered an 18% increase over 2010/11. Profit before and after tax at Rs. 195 crores and Rs. 136 crores respectively were also higher than the previous year.

(vii) Estate Management Services Pvt. Limited, Sri Lanka (EMSPL), where the Company effectively owns 49% of the shares is the holding company of Watawala Plantations Ltd (WPL). During the financial year ended 31st March 2012, EMSPL acquired 100% of the shares of Watawala Marketing Ltd from Watawala Plantations Ltd. WPL's operations were impacted by several challenges facing the Srilankan plantation sector in general including loss of crop due to adverse weather conditions, steep cost escalations due to increased employee costs and fall in exports. The other crops like Palm Oil and Rubber did well. WPL's Profits include the one time Profit on sale of Watawala Marketing Ltd's shares held by it.

(viii) The turnover of Amalgamated Plantations Private Limited (APPL), in which the Company owns a 49.07% stake, was Rs. 397.12 crores which was marginally lower than in the previous year due to crop losses and lower realisations. The lower crop was on account of continued pest attacks and early onset of winter leading to cessation in plucking activity. Performance was also impacted by input cost increases including wage costs.

5. NourishCo Beverages - Joint Venture in Liquid Beverage Business

NourishCo Beverages Limited, the Joint Venture between your Company and PepsiCo Inc., was incorporated in November 2010 and commenced operations in 2011. NourishCo is in the business of developing, manufacturing, selling and distributing hydration beverages. Over 17 months, the company focused on working closely with JV partners in commercialising new products and driving the of take of new category creations.

Nourish Co Beverages successfully launched two products, namely Tata Water Plus, India's first nutrient water, and Tata Gluco , a glucose-based lemon favoured drink providing instant energy and refireshment.

Going forward, NourishCo's strategy is to consolidate its market presence, validate its business model and expand its footprint across other markets in a phased manner.

6. Tata Starbucks Limited

Following the signing of the Memorandum of Understanding with Starbucks Coffee International, Inc., USA (Starbucks), a 50/50 Joint Venture called Tata Starbucks Limited was formed during the year. Tata Starbucks will own and operate Starbucks cafÃÂ©s in cities across the country, with the first store slated to open in the later part of this year. These cafÃÂ©s will be branded as Starbucks Coffee "A Tata Alliance". The venture brings the premium Starbucks experience to Indian consumers along with the trust and reliability of the Tata name.

7. MoU with Kerala Ayurveda Limited

Following the MoU signed with Kerala Ayurveda Limited (KAL) to develop beverage and food products around ayurvedic recipes, the Company is in the process of developing three variants of such water based beverages with Metabolism, Infammation and Insulin Management functionality. The proprietary ingredients inspired by ayurveda have been clinically proven to be functional. The first range of water neutral prototypes and second generation beverage prototypes with 'Lime-lemony' favour has been developed. Internal reviews are currently being conducted.

8. Review of Activities

A. The Tea Industry

In 2011, the tea crop was favourable with India registering record production. Black tea production in major producing countries in January/December 2011 was 988.2 mn kgs as against 966.4 mn kgs in 2010, an increase of 21.8 mn kgs. The crop in India was also higher than the previous year. Indian exports in 2011 were estimated at 192.9 mn kgs as against 222 mn kgs in the previous year - lower by around 13% due to reduced demand from the Middle East and Iran. Price levels were commensurate with quality, dropping to its lowest during the heaviest cropping months. The year ended with a widening in price bands between the best and plainer teas. Consumption continued to rise at around 3 to 3.5% per annum. Unlike 2011, the first quarter of 2012 is likely to see a significant drop in South Indian production.

B. Domestic Branded Tea Operations

The Company's branded operations reported a stellar performance, registering an overall 10% growth by volume and 13% by value. All the Company's major brands reported growth over the previous year.

The Company's major national brands, namely Tata Tea Gold and Tata Tea Agni, grew in excess of 11% each over the previous year supported by a successful '25 years of Tata Tea' campaign. This campaign comprised the new 'Soch Badlo' (change your perspective) communication, ground level inputs, displays, activations and online media support. The objective of the campaign was to leverage 25 years of the brand and express our appreciation to stakeholders. The Soch Badlo campaign, launched under the Jaago Re platform, won accolades at the Abby awards, India's most prestigious advertising awards organised by the Advertising Agencies Association of India and the Advertising Club of Bombay. The campaign won three bronze Abbys in three categories Ã Brand Campaign Website, Creative use of Social Media and Digital Integrated Campaign.

The Regional brands performed well recording a 7% volume growth over prior year. The highlights included the restage of Gemini and gain in share of Chakra Gold inspite of tough competition and Kanan Devan which was under pressure in the previous year, showing growth this fiscal over last year.

The Company implemented price changes across most of its key brands to offset the impact of tea cost increases.

During the year, your Company launched several new products / SKUs. These included new and exciting variants of Tetley Green Tea in three delicious favours - Cinnamon & Honey, Citrus & Spice and Aloe Vera and 'Tea Veda' a brand positioned in the luxury segment of the tea category.

The Jaago Re campaign aimed to metamorphose the thought of 'Social Awakening' to reality by being a unique online collaborative platform in the domain of 'Social Good' continues to herald a new movement of change by providing a common platform for exchange of ideas and resources between citizens and social change agents Ã both NGO's and individuals. An active social media campaign around the portal has led to high engagement levels among the target group through Face book, Twitter and an active blog.

The Gaon Chalo initiative, an innovative programme aimed at rural penetration, helped create employment opportunities among the poor sections of the society in India. The programme was extended to new geographies and is showing positive results. During the current year, additional states will be added and this initiative will be a key thrust area going forward.

C. International Branded Operations

UK operations performed well in 2011/12 with gain in grocery and strong performance by speciality teas as well as growth in premium offerings. In a competitive market wherein the black tea market declined, your Group continued to retain its market position with market leadership in specialty categories like Decaf and Redbush. In green tea, the year under review saw increase in volumes with the Tetley brand being in the number two position in this category. Tetley packs carrying the Rainforest Alliance CertifiedÃ seal are now available in markets like UK, Canada and Europe. This marks another major milestone on the journey to becoming a more sustainable brand for Tetley.

Canada continues with its new product development agenda. Infusions, New Chai blends (dark chocolate and vanilla bean) and Green Pomegranate 80s launched earlier are gaining distribution.

Specialty tea is gaining distribution and Tetley Chai Latte, an exciting new product combining both coffee and tea, was launched during 2011/12 in Australia, which was very well received.

Our brands also saw improved performance in other markets like the USA, Russia, Czech Republic and Poland.

D. Extractions

The division's Profitability improved with increased volumes of high value added instant tea products and by realisation of VKGUY benefits from Government of India. A new product of black instant tea was developed for a European customer.

Zhejiang Tata Tea Extraction Company Limited, China which is a subsidiary of your Company, is a Joint Venture with Zhejiang Tea Group Company Limited China. The JV was set up for the manufacture and marketing of Instant Tea, Tea Polyphenols and tea concentrates. The company commenced its production of Green Instant tea products after initial delays and has started trial exports to USA. The commercial production of Tea Polyphenols is expected to commence during the current financial year.

E. Exports

The FOB value of exports during 2011-12 was Rs. 157 crores, which is in line with the previous year. The tea bag unit at Kochi performed well and continued to meet the Group's requirements in Australia, Poland, Eastern Europe, Canada and the Middle East. The unit is working with the commercial team to develop new SKUs for existing markets. The Tata Tetley Division, Cochin, was certified for compliance with OHSAS 18001 standards. As a green initiative, the factory discontinued the incineration of cartons, BOPP film and CFC.

F. Plantation Operations

In 2011-12, the crop production at the Company's Pullivasal and Periakanal estates was higher at 20.62 lakh kgs against 19.79 lakh kgs in the previous year, while the yield was higher by 4%. The crop was affected by the onset of South West monsoons in June 2011, which remained fairly vigorous until end-September, 2011. The total rainfall received during the monsoons was 25% more in Periakanal and 10% more in Pullivasal, than during the corresponding period in the previous year. This was followed by dry weather, which continued till end March 2012.

The productivity achieved by the two estates to end March 2012 was 55.54 kg against 50.65 kg achieved during the previous season. The plucker productivity of 56.14 kgs achieved by Pullivasal Estate and 54.91 kgs achieved by Periakanal estate are both all time records.

Kanan Devan Hills Plantations Private Limited (KDHP) is the erstwhile south India plantation business of the Company which is now majority owned by management and workers with your Company retaining a minority stake. The Company completed its seventh consecutive year of strong performance despite adverse weather conditions. Compared with the previous year its operational results were affected by unprecedented increase in the workers' wages during the year. During the year under review, Mr. T V Alexander, Managing Director of KDHP passed away and your board wishes to place on record the excellent services rendered by Mr. Alexander in the formation of KDHP and also in your Company earlier. The Board of KDHP has appointed Mr. Chacko P Thomas to take over as Managing Director.

G. Community Development, Employees' Welfare and Environment Conservation

The Company's commitment to community development and social welfare continues through its initiatives such as the General Hospital, Srishti Welfare Centre and High Range School in Munnar. The General Hospital conducted an extensive programme to increase public awareness on HIV/AIDS. During the year under review, the General Hospital provided treatment (including surgeries and deliveries) to a large number of people. The benefciaries covered patients from the tribal population who were treated firee of cost.

Programme coordinators at the Srishti Welfare Centre which focuses on education and vocational training for differently abled people, were given opportunities to increase their functional skill sets by interacting with welfare units outside their region.

The students of the High Range School performed very well in the CBSE Class X and XII and among the successful candidates were three toppers who are children of the general workers of your Company and KDHP.

The activities of Srishti Welfare Centre functioned smoothly with the Trainees and Programme coordinators of each unit being facilitated to travel outside the region to improve knowledge in their functional areas and also gain exposure on the functioning of the skill sets available at other locations. The unit participated in exhibitions held overseas which show cased the products made at the centre.

9. Industrial Relations

During the year under review, industrial relations remained generally peaceful at all our offices and establishments.

The Company initiated an exercise to reshape the organisation design to attract, nurture and develop talent. The newly developed Organisation Resource Review (ORR) process enables Tata Global Beverages to identify critical roles and key talent in alignment with organisation design, development and succession planning.

10. Corporate Governance & MD&A

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MDA). The MDA also covers the consolidated operations and reflects the global nature of our business.

11. Tata Business Excellence Model (TBEM)

The TBEM assessment for 2012 is underway and this is the 3rd year that the Company is participating in the TBEM external assessment process. The Group achieved an overall improvement in the score in the second assessment conducted in 2011 compared with the 2010 score. The feedback that follows the external assessment gives us an opportunity to understand our strengths and areas for improvement. In addition, it also serves as means to learn about and manage organisational performance.

12. Directors' Responsibility Statement

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 ('the Act') and based on the representations received from the operating management, the Directors hereby confirm that:

i) In the preparation of the Annual Accounts for 2011/12, the applicable Accounting Standards have been followed and there are no material departures.

ii) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of afairs of the Company at the end o the financial year and of the Profit of the Company for the financial year.

iii) They have taken proper and sufcient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They have prepared the Annual Accounts on a going concern basis.

13. Directors

During the year, Mr. P D Unsworth resigned as a Director with effect from 30th June 2011 due to personal reasons. Mr. Ajay Shankar also resigned as a Director with effect from 26th November 2011 consequent to his taking up an assignment with the Government of India, as Member Secretary of the National Manufacturing Competitiveness Council. Your Directors wish to place on record their appreciation and recognition of the contributions made by Mr. P D Unsworth and Mr. Ajay Shankar to the progress of the Company during their association with the Company.

During the year, Mr. Ajoy Misra was appointed as an Additional Director and as Executive Director by your Board with effect from 1st December 2011. Prior to joining the Company, Mr. Misra was the Senior Vice President , Sales & Marketing with Indian Hotels. Mr. Misra has been associated with the Tata Group for over 30 years and in business leadership positions for about 15 years. The appointment and remuneration of Mr. Misra will come up for approval of the members at the forthcoming Annual General Meeting.

Mr. P T Siganporia retires as Director and Managing Director of the company with effect from 30th June 2012. Mr. Siganporia, a senior TAS officer, joined the company in 1975 and held several important positions during his tenure. His tenure included responsibilities in Sales & Marketing in the Packet Tea Division, Kolkata and recently in the Executive Office, London. He successfully led critical change initiatives across Tata Global Beverages and has played a key role in Tata Global Beverages' transformation from its heritage in tea plantations in India to a growing global organisation with a portfolio of strong and dynamic brands. Mr. Siganporia retires after 38 years of distinguished service in the Tata Group. The Board wishes to place on record its appreciation for the contribution made by Mr. Siganporia during his tenure with the Company.

Mr. Harish Bhat has been appointed CEO and Managing Director of Tata Global Beverages Limited with effect from 1st July 2012. Mr. Bhat takes over from Mr. P T Siganporia, who retires on 30th June 2012. He was previously with Tata Tea Limited from 1988 to 2000, during which period he held several senior roles in sales, marketing and as business head. Most recently, he was with Titan Industries Limited as Chief Operating Officer of the Watches and Accessories Division, where he led the world's fifth largest watches business with distinction. The appointment and remuneration of Mr. Bhat will come up for approval of the members at the forthcoming Annual General Meeting.

Mr. Cyrus P Mistry and Mr. Darius Pandole have been appointed as Additional Directors with effect from 22nd June, 2012. Mr. Darius Pandole is an Independent Director. As per the provisions of Section 260 of the Companies Act, 1956 (the Act) both Mr. Cyrus P Mistry and Mr. Darius Pandole hold office upto the date of the forthcoming Annual General Meeting (AGM) of the Company and are eligible for appointment as Directors. The Company has received notices under Section 257 of the Act, in respect of the above persons, proposing their appointment as Directors of the Company. Resolutions seeking approval of the members for the appointment of Mr. Cyrus P Mistry and Mr. Darius Pandole as Directors of the Company have been incorporated in the Notice of the forthcoming AGM along with brief details about them.

Mr. Analjit Singh, Mr. V Leeladhar and Mr. U M Rao retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election.

Brief particulars and expertise of these Directors and their other directorships and committee memberships have been given in the annexure to the Notice of the Annual General Meeting in accordance with the requirements of listing agreement with Stock Exchanges.

All these directors have filed Form DD-A with the Company as required under the Companies (Disqualification of Directors under Section 274(1)(g) of the Companies Act, 1956) Rules, 2003.

14. Auditors

The Members are requested to appoint the Auditors and fix their remuneration. Messrs. N M Raiji & Co. and Lovelock & Lewes, the retiring Auditors have furnished certificates of their eligibility for re-appointment as required under the Companies Act, 1956.

15. Cost Auditors

The Central Government has approved the appointment of Messrs. Shome & Banerjee, 5A Nurulla Doctor Lane, 2nd Floor, Kolkata-700017 as cost auditors for the Company for conducting Cost Audit for the financial year 2011-12. The due date for fling the Cost Audit Report for the financial year ended March 31, 2011 was September 30, 2011 and the Cost Audit Report was filed by the Cost Auditors on 13th September, 2011. The due date for fling the Cost Audit Report for the financial year ended March 31, 2012 is September 30, 2012.

16. Particulars of Employees

Information as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this report. However as per the provisions of Section 219(1)(b)(iv) of the Companies Act,1956, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Companies Act, 1956. Any member interested in obtaining such particulars may write to the Company Secretary for a copy thereof.

17. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

18. Concluding Remarks

The Directors are sure that the shareholders would like to join them in conveying their appreciation to all employees of the Company for their sincere and dedicated services during 2011-12 without which such a performance would not have been possible in a challenging environment.

On behalf of the Board of Directors

Mumbai, (R N TATA)

29th June, 2012 Chairman

Mar 31, 2011

Dear Members,

The Directors are pleased to submit their report together with the audited statement of accounts for the year ended 31 March 2011.

1. Highlights Ã Consolidated Performance

Your Company performed well in a difficult operating environment. Consolidated Operating Income of Rs. 6,005 crores was three percent higher than the previous year. At constant exchange rates, the growth would have been six percent. The year was particularly challenging due to rising commodity costs both in tea as well as coffee, exacerbated by a difficult trading environment due to intense promotional activity by competition across key regions. Despite the challenging environment, the Group reported a year-on-year sales growth of Rs. 370 crores at constant exchange rates, on account of price increases enabled by the strength of our brands, improved performance by instant coffee business coupled with favourable impact of acquisitions. profit from Operations for the year under review at Rs. 509 crores was impacted by commodity cost increases coupled with increased investment behind brands, product development and new market launches, essential to preserve the long-term health of our business. Resultantly, profit after tax was Rs. 292 crores compared to Rs. 393 crores reported in the prior year.

The Group's strategy is to grow in core tea and coffee markets whilst pursuing disruptive innovation in "good-for-youÃ beverages. The focus will be on achieving a stronger footing in the US and Russian markets and expanding across beverage categories in South Asia and other regions. Equally important will be to leverage scale and operations capability to improve efficiencies.

2. Stand alone Financial Highlights

The Directors now present below the stand alone financial highlights for 2010/11:

Rs. Crores 2010/11 2009/10

Total income 1914 1837

profit before interest, depreciation, exceptional items and tax 248 312 Deduct:

Interest (net) (29) (45)

Depreciation (12) (41) (12) (57) profit before tax and exceptional items 207 255

Exceptional income (net) 23 240

profit before tax 230 495

Provision for tax (49) (104)

profit after tax 181 391

Add: surplus brought forward from previous year 346 158

Amount available for appropriation 527 549

Proposed dividend (124) (124)

Income tax on dividend (18) (19)

Transfer to general reserve (18) (39)

Transfer from debenture redemption reserve 81 -

Transfer to debenture redemption reserve (81) (160) (21) (203)

367 346

The Company was able to implement price increases in selective categories, to recover a significant part of the input cost increases during the year. Your Company performed creditably in a difficult year, maintaining volume leadership in India, with the key brands recording impressive growth. The Company continued to invest behind its brands and aggressively pursue its innovation agenda by introducing new health and wellness products and creating different ways of increasing the consumption of tea at various price points.

Total income for 2010/11 at Rs. 1,914 crores registered a four percent increase over the previous year, attributable to improved branded tea business aided by price increases and volume improvements. profit before tax and exceptional items at Rs. 207 crores was lower due to input cost increases and increased spend on brand building. Exceptional items in the previous year included significant profits from sale of investments. profit after tax at Rs. 181 crores, also reflects this lower profits from the sale of investments compared with the previous year.

3. Dividend

The Directors are pleased to recommend for the approval of the shareholders a dividend of Rs. 2 per share on the paid-up equity share capital of the Company in respect of the financial year 2010/11 as compared with the dividend of Rs. 2 per share declared last year.

4. Review of Subsidiary and Associate Companies

i) a. As required under the listing agreement with the stock exchanges the audited consolidated financial statements of the Company together with all its subsidiary and associate companies prepared in accordance with applicable Accounting Standards is attached.

b. The Ministry of Corporate affairs has by its notification dated 8 February 2011 granted a general exemption to companies, as per which, the provisions of Section 212 shall not apply in relation to subsidiaries, subject to the fulfillment of certain conditions. Accordingly the consolidated financial statements of the holding company and all subsidiaries duly audited by its statutory auditors have been presented and the individual accounts of each of the subsidiary companies have not been attached.

c. Any shareholder may either ask for a copy or inspect at the registered ofce a copy of the audited accounts of the subsidiary companies (where required to be prepared).

ii) a. Tata coffee Limited, a subsidiary of the Company, reported an increase of 20 percent in total operating income. The growth is attributable mainly to improved instant coffee performance, which was impacted by weaker volumes in the previous year. profit from operations more than doubled as a result of improved trading performance and favourable exchange impact compared with previous year. As a result, profit before and after tax improved significantly over previous year further aided by profit from sale of investments despite lower dividend received from its subsidiary. The Directors of Tata coffee Limited have recommended a fnal dividend of Rs 5 per share which is in addition to the interim dividend of Rs. 5 per share paid by Tata coffee Ltd. in January 2011.

b. Eight O'clock coffee Company, USA, (EOC) a subsidiary of Tata coffee, performed well in a challenging year which was characterised by unprecedented rises in commodity costs, particularly Arabica. The operating income for 2010/11 at constant exchange rates was at the same level as in the previous year. Price increases taken during the year offset the impact of some lower volumes. Despite maintaining the turnover at previous year levels, the impact of commodity cost increases left profit after tax marginally below the previous year.

iii) The Company's wholly owned subsidiary in the USA, Tata Tea Extractions Inc (formerly Tata Tea Inc.), reported a lower operating income in

2010/11 compared to 2009/10 as the previous year had the benefit of liability write-back. profit after tax was also lower reffecting the write back in the previous year.

iv) Mount Everest Mineral Water Ltd. (MEMW), the Company's subsidiary, recorded a higher operating income aided by higher service income. In order to minimise the impact of input costs, MEMW focused on operating cost optimisation through a series of initiatives in product mix rationalisation, vendor development, development of procurement efficiencies and factory upgradation. As a result of these measures, the loss for the year decreased compared with the previous year.

v) The consolidated accounts of Tata Global Beverages Group Limited (formerly Tata Tea (GB) Ltd.) reflects the financial performance of the Tetley Group during 2010/11. Operating income was higher by six per cent attributable to the benefit of price increases in major markets and favourable impact of acquisitions. At constant exchange rates the sales growth is higher by 10 percent. Despite an increase in input costs and increased investment behind brands and growth initiatives, profit after tax is favourable compared with previous year due to the absence of adverse foreign exchange translation impact on surplus funds held in USD. In the year under review, potential for such currency fuctuations has been capped by conversion / forward sale of dollar into sterling.

vi) Estate Management Services Pvt. Limited, Sri Lanka, where the Company effectively owns 49 percent of the shares is the holding Company of Watawala Plantations Ltd. (WPL). WPL recorded a higher turnover and improved profitability reffecting the increase in realisation for Sri Lankan teas.

vii) The turnover of Amalgamated Plantations Private Limited (APPL), in which the company owns a 49.07 percent stake, was marginally lower than in the previous year. While the company benefitted from higher realisation for its teas, it was impacted by lower crop due to adverse weather conditions and pest attack. With the objective of encouraging share-ownership amongst employees and to build long term employer-employee relationships and create opportunities for wealth creation, APPL successfully completed an issue of 6% Cumulative Compulsorily Convertible Participatory Preference Shares (CCCPPS) during 2010/11. Additionally, APPL is also supported in its initiatives by the International Finance Corporation (IFC), Washington which is also a equity shareholder in APPL.

5. Joint Venture in Liquid Beverage Business

Last year we reported that the Company had signed a Memorandum of Understanding (MoU) with PepsiCo Inc. USA for exploring the possibility of the formation of a Joint Venture (JV) in the area of non-carbonated ready-to-drink beverages. We are happy to now report that the Company and PepsiCo India Holdings Private Limited (PIH) have formed a JV company, named NourishCo Beverages Limited, in which the Company and PepsiCo each hold 50 percent of the equity capital. The vision of the JV is to develop the business in India and internationally focusing on health and wellness beverage products. This JV is expected to launch a slew of fortified and "good-for-youÃ health products.

The year under review was marked by interim transition of sales and distribution of Himalayan Water to PIH, en route to NourishCo Beverages Ltd. This transition, effective 1 February 2011, although in its embryonic stage, is expected to drive market reach and volumes of Himalayan Water, aforded by the wider distribution network of PepsiCo India, going forward.

6. MoU with Starbucks

The Company together with its subsidiary, Tata coffee Limited, has signed a non binding Memorandum of Understanding (MoU) with Starbucks coffee Company. This MoU will create avenues of collaboration between the two companies for sourcing and roasting high quality green coffee beans in Tata coffee's Coorg, India facility.

7. MoU with Kerala Ayurveda Limited

The Company has signed a MoU with Kerala Ayurveda Limited to enter into a 50:50 joint venture for facilitating the development of a range of leading edge, functional and great tasting beverage and food products based on proven Ayurvedic recipes, actives and formulation with necessary research, development and commercialisation capability. The definitive agreements are being finalised.

8. Acquisition of stake in Activate

The Group acquired a 31 percent stake, calculated on a fully diluted basis, in The Rising Beverages Company LLC. Rising Beverages manufactures and markets a range of vitamin and favour enhanced water using unique powder dispensing technology, under the ÃActivateÃ brand. This acquisition would give us access to the functional water category which is one of the fastest growing beverage categories in the US. The Company has the option to increase its stake in Rising Beverages in the event the agreed performance criteria are met.

9. Review of Activities

A. The Indian Tea Industry

Fiscal 2010/11 was another good year for the Indian Tea Industry, which witnessed strong commodity prices on the back of buoyant domestic demand estimated at 3 percent to 4 percent. All India crop was lower than the previous year by 12.50 M kgs largely due to adverse climatic conditions. The markets experienced a significant rise in price levels from August 2010 onwards due to the loss of crop attributed to excessive rain and pest attacks and the consequence of this was lower exports compared to the previous year.

B. Domestic Branded Tea Operations

The company's key domestic brands such as Tata Tea Premium and Chakra Gold performed well during the year under review. The branded business reported a value growth of 6 percent and a volume growth of 2 percent over the previous year.

Tata Tea Gold continued its robust growth story with a 10 percent volume growth over previous year, backed by a successful consumer promotion that brought new trials for the brand.

Our fagship brand, Tata Tea Premium, made a strong recovery, buoyed by a successful restage and key initiatives undertaken on the brand which included introduction of a new pack face, a fresh proposition driven primarily by a new TV campaign and massive ground level activation.

Our strong brand, in the value segment, Tata Tea Agni, saw robust growth and was 8 percent ahead in volume terms over the previous year.

The 25 Years celebration of Kanan Devan was supported by media advertising with the strapline "Winning challenges with a smile for 25 yearsÃ and received a positive response from customers and consumers.

Chakra Gold launched a new thematic campaign which strengthens the "open up your mindÃ proposition that has helped increase the positive disposition of the brand among users of competitive products.

Tetley experienced continuous on ground activation coupled with a new global brand proposition and product extensions, which led to the most profitable year for the brand since its launch in India.

The infuential Jaago Re Campaign continued, and a new film was launched which focused on corruption in the education system. This was supported by www.jaagore.com, an online portal that aims to connect the concept of 'Social Awakening' to reality. The portal seeks to herald a new movement of change by providing a common platform for exchange of ideas and resources between citizens and social change agents Ã both NGOs and individuals. A first in India, the portal has 6.2 Lakh registered users since it was first launched in 2008. There are 170 NGOs, 340 volunteering opportunities and an average of 100 volunteers per month.

In a challenging market environment we are very pleased that the Company maintained its volume leadership in the tea market in India. While the environment will continue to witness competitive pressures, the Company is developing a fresh strategy to counter competition in the branded tea sector in India. To start with, the Company is conducting a host of market activation programmes and on-ground promotions to promote all its brands across the country. The Company also plans to refresh and relaunch its tea brands with a view to attract new consumers.

C. International Branded Operations

The global Tetley brand was revitalised during the year, with a strong and renewed focus which will be at the heart of the brand's ongoing growth agenda. Building on its strong heritage, the Tetley brand continues to develop a broad range of new and exciting teas to suit all cultures, tastes and moods in a variety of formats around the world, particularly for non-black tea variants such as Redbush and Green.

The Group continues to focus on geographical expansion as well as widening its brand and product portfolio. Some of the key initiatives taken in 2010/11 included the test launch of SUKK (a jelly based drink) and T4 Kidz and Tetley Soya in the UK; Tetley for Soy, Billy Campfre & Kitchen Brew variants in Australia and the launch of our products in the Middle East. We continued the emphasis on the speciality category in the UK and Tetley Infusions in Canada, with the launch of two new favours. Further initiatives are under way for breakthrough innovation in our key strategic growth areas of health and wellness, convenience and sustainability.

Following the decision taken to move to Rainforest Alliance certification of all Tetley products by 2016, the first certifed consumer products have appeared on the shelf. Farmer's First Hand, a web-based promotional activity on Facebook, is being used to support the transition to Rainforest Alliance Certifed Tea.

D. Instant Tea

The Instant Tea division reported higher production as well as sales during the year 2010/11. During the year, the division developed a new black instant tea powder for one of its existing customers in Japan.

Zhejiang Tata Tea Extraction Company Limited, China which is a subsidiary of the Company, is a joint venture with Zhejiang Tea Group Company Limited, China set up for the manufacture and marketing of Instant Tea, Tea Polyphenols and tea concentrates. The capacity planned in this facility is 1,750 MT. The market for Green tea extracts is growing at a good pace and as this facility caters exclusively to this segment, the share of the company in this segment will stand to benefit. The project progressed well during 2010/11 and has commenced production of Green Instant Tea products. Exports to various geographies including the US and Europe as well as sales to domestic customers are expected to commence during the second half of the current year.

E. Exports

Exports during the year at FOB value of Rs. 156 crores were in line with previous year. The Tea Bag unit at Kochi continued to meet the Group's requirements in Australia, Eastern Europe and Middle East and performed well during the year.

F. Plantation Operations

Crop production for the year ended 31 March 2011 at the Company's Pullivasal and Periakanal Estates was 19.79 Lakh kgs against the previous year crop of 21.94 Lakh kgs. The yield achieved was lower by 10 percent due to unfavourable weather conditions.

The productivity achieved by Pullivasal and Periakanal estates to end 31 March 2011 was 50.65 kgs against 51.70 kgs achieved for the same period of the previous season. The combined productivity achieved by these two estates during the year is the second highest while the plucking average of 51.46 kg achieved by Pullivasal Estate is an all time record.

Kanan Devan Hills Plantations Private Limited (KDHP) has completed the sixth consecutive year of strong performance and has underscored the strong fundamentals of the unique business model of employee empowerment practiced in the company. Though the operations of the year gone by were affected by adverse weather conditions and softening of prices for teas produced in South India, it still posted excellent financial results, second only to the record results for the year ended 31 March 2010. With representation from all sections of the employees on its Board as well as following a participatory nature of management, KDHP has excelled in creating a unique self sustaining model for the company. With over 11,000 employees spread over 7 estates and 16 factories, it has now transformed itself into the largest Tea producing company in South India.

G. Community Development, Employees' Welfare and Environment Conservation

The Company's contribution to society and its welfare continued through community development and social welfare schemes such as the General Hospital at Munnar, the High Range School and Srishti Welfare Centre. Key activities undertaken by the General Hospital included an awareness programme on HIV/AIDS, and awareness programmes on bio-medical waste management and the importance of voluntary blood donation. The Hospital also carried out a breast cancer awareness programme and periodic diabetic clinics. The Srishti Welfare Centre, which provides education and vocational training to mentally and physically challenged persons, received a runner-up award for outstanding safety performance from the National Safety Council (Kerala Chapter) for the year 2011.

10. Industrial Relations

During the year under review, industrial relations remained generally peaceful at all our offices and establishments.

As part of the Company's integration programme, the relocation of employees from our historical home in Kolkata to Bangalore was successfully accomplished. The Company also offered the option of voluntary employee separation scheme to employees of the non management cadre who were unable to relocate to Bangalore for personal reasons.

11. Corporate Governance & Management Discussion and Analysis (MDA)

A detailed report on Corporate Governance is separately attached together with a report on the MDA. The MDA also covers the consolidated operations and reflects the global nature of our business.

12. Tata Business Excellence Model (TBEM)

The Company will continue to participate in the TBEM external assessment in the current year as well. The feedback received from the assessment conducted in 2010 has helped the Group to confirm many actions as well as realise new opportunities. This will be the second time we will be assessed as Tata Global Beverages on a consolidated basis. Senior leadership team in the Group has taken individual ownership of the various TBEM categories. Each of the category owners will now head a team that meets regularly to progress as per a calendar that has been drawn up for this activity.

13. Directors' Responsibility Statement

Pursuant to the requirement of Section 217 (2AA) of the Companies Act, 1956 ('the Act') and based on the representations received from the operating management, the Directors hereby confirm that:

i) In the preparation of the Annual Accounts for 2010/11, the applicable Accounting Standards have been followed and there are no material departures.

ii) They have selected such accounting policies with the approval of the Statutory Auditors and applied them consistently and made judgments 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 the financial year.

iii) They have taken proper and suffcient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They have prepared the Annual Accounts on a going concern basis.

14. Directors

During the year Mr. Ajay Shankar was appointed as an Additional Director with effect from 30 April 2010 and he was subsequently appointed as a director liable to retire by rotation at the Annual General Meeting held on 23 August 2010.

Mrs. Sangeeta Talwar, Executive Director, resigned from the services of the Company with effect from 1 August 2010 to pursue a new assignment with a non-profit company. Your Directors wish to note their appreciation for her contribution to the development of the company.

Mr. P D Unsworth resigned as the CEO of the Tata Global Beverages Group and as a director from the Board of the Company with effect from the close of 30 June 2011 for personal reasons. As CEO of the Tata Global Beverages Group since 2008, Mr. Unsworth led the Group's integration and transformation agenda in the face of many challenges which enabled the business to make huge progress both towards creating a robust strategy and developing a new culture to support the ambitious growth. The Board wishes to place on record its deep appreciation of the contributions made by Mr. Unsworth towards the progress of the Company and its subsidiaries.

Mr. R K Krishna Kumar, Mr. A R Gandhi, Mr. J S Bilimoria and Mrs. Mallika Srinivasan retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election.

Brief particulars and expertise of these Directors and their other directorships and committee memberships have been given in the annexure to the Notice of the Annual General Meeting in accordance with the requirements of Listing agreement with Stock Exchanges.

All these Directors have filed Form DD-A with the Company as required under the Companies (Disqualifcation of Directors under Section 274(1)(g) of the Companies Act, 1956) Rules, 2003.

15. Auditors

The Members are requested to appoint the Auditors and fx their remuneration. Messrs. N M Raiji & Co. and Lovelock & Lewes, the retiring Auditors have furnished certificates of their eligibility for re-appointment as required under the Companies Act, 1956.

16. Particulars of Employees

Information as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this report. However, as per the provisions of Section 219(1) (b) (iv) of the Companies Act,1956, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Companies Act 1956. Any member interested in obtaining such particulars may write to the Company Secretary for a copy thereof.

17. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

18. Concluding Remarks

The Directors are sure that the shareholders would like to join them in conveying their appreciation to all employees of the Company for their sincere and dedicated services during 2010/11 without which such performance given the challenging environment would not have been possible.

On behalf of the Board of Directors

(R N TATA) Mumbai, Chairman 28 July 2011

Mar 31, 2010

The Directors are pleased to submit their report together with the audited statement of accounts for the year ended 31st March, 2010.

Your Directors at the outset wish to share with you an important milestone in the history of your Company. Throughout its history, your Company has made a number of bold strategic moves to take its business in new directions and transition from a tea plantation company to a global beverages company. In order to reflect this transformation, the board decided that the company name should be changed to Tata Global Beverages Limited. Thus Tata Tea Limited is now Tata Global Beverages Limited. The name signifies our intent to be truly global and our successful transition from being a tea and coffee commodity business to one focused on delighting consumers across the world with great tasting, branded beverages.The change in name, which the Shareholders approved through a postal ballot in May / June this year, signifies the intent of your company to make a significant impact in the global beverages industry.

The change in name has also been approved by the Central Government and a fresh Certificate of Incorporation dated 2nd July, 2010 has been issued by the Registrar of Companies, West Bengal. Your Directors wish to inform you that as the Board had approved the Accounts for 2009-10 prior to the receipt of the approval from the Shareholders and the Central Government and prior to change of name being effective, the Accounts and the AuditorsReport were approved in the name of Tata Tea Limited.

Your Directors also wish to mention that at its meeting on 30th April, 2010, the Board approved a sub-division of the equity shares of the Company, whereby one equity share having a face value of Rs. 10 per share is sub-divided into ten equity shares of a face value of Re 1 each. This will help bringing about greater liquidity and increasing the retail interest in the equity shares of the Company. The Shareholders of the Company have approved the sub-division through a postal ballot in May/June 2010 together with the approval for consequential amendments to the Memorandum and Articles of Association of the Company.

1. Highlights - Consolidated Performance

Consolidated income in 2009-10 increased by 19% from Rs. 4874.1 Ocrores to Rs. 5820.92 crores. Profit before Tax and exceptional items was Rs. 624.85 crores (previous year Rs.525.93 crores) recording an increase of 19%. Exceptional items were lower at Rs. 16.13 crores compared with Rs. 730.38 crores in the previous year because of one time exchange gains in the previous year. Profit before Tax after including exceptional income was Rs. 640.98 crores (previous year Rs. 1256.31 crores) and the consolidated Net Profit was Rs. 390.30 crores (previous year Rs. 700.55 crores).The reduction in the consolidated net profits is primarily due to absence of exchange gains of the previous year. The basic earnings per share (EPS) for the current year were Rs. 63.11 as compared to Rs. 113.28 in the previous year. Consolidated EPS before exceptional items was higher at Rs. 51.07 versus Rs. 47.39 in the previous year.

The Company continues its focus on strengthening the global organisation to accelerate growth and for developing global capabilities, improving synergies, achieving integration and driving functional excellence in areas like Human Resources, Finance, IT, Product innovation and Brands.These initiatives are vital to the global beverage transformation agenda. These efforts are coordinated by the Executive office in the UK subject to the decision of the Boards of the respective entities.

2. Standalone Financial Highlights

Your Directors now present below the standalone financial highlights for 2009-10:

Rs. Crores

2009-10 2008-09

Total Income 1836.84 1524.64

Profit before interest, depreciation, exceptional items and tax deduct: 312.68 297.90

Interest (net) 45.06 48.60

Depreciation 12.32 57.38 10.65 59.25

Profit before tax and exceptional items 255.30 238.65

Other exceptional items 240.13 (9.59)

Profit before tax 495.43 229.06

Provision for tax 103.96 70.00

Profit after Tax 391.47 159.06

Add: Surplus brought forward from previous year 158.07 170.25

Amount available for appropriation 549.54 329.31

Proposed Dividend 123.68 108.22

Income tax on dividend 19.45 17.11

Transfer to General Reserve 39.15 15.91

Transferto Debenture Redemption Reserve 21.00 203.28 30.00 171.24 346.26 158.07

The Company recorded improved operations during 2009-10 with total income increasing by 20% to Rs. 1836.84 crores compared with Rs. 1524.64 crores in the previous year. The growth in total income for the year was driven by strong performance in the branded tea segment and was achieved by a combination of higher unit realization and volume growth.There was increased spending on brand building and promotions and new product development and launches. Profit before tax and exceptional items improved by about 7% to Rs. 255.30 crores compared with Rs. 238.65 crores in the previous year. During the current year the Company earned an exceptional income of Rs. 240.13 crores mainly from profit on sale of its investment in Rallis India Ltd, as against an exceptional expenditure of Rs. 9.59 crores during 2008-09. Provision for taxation in the current year was at Rs. 103.96 crores (previous year Rs. 70.00 crores). Consequently, the Profit after tax was Rs.391.47 crores against Rs. 159.06 crores in the previous year.

3. Dividend

Your Directors are pleased to recommend for the approval of the shareholders a dividend of Rs. 20 per share on the paid-up equity share capital of the Company in respect of the financial year 2009-10 as compared with the dividend of Rs. 17.50 per share declared last year. The total outgo on account of dividend, inclusive of taxes, for 2009-10 is Rs. 143.13 crores which represents a pay-out of 36.56 % of the companys stand alone profits. On the sub-divided equity share of Re. 1 each, the dividend recommended translates to Rs. 2 per share.

4. Review of Subsidiary and Associate Companies

i. a) As required under the Listing Agreement with the Stock Exchanges the Audited Consolidated Financial Statements of the Company together with all its subsidiary and associate companies prepared in accordance with applicable Accounting Standards is attached.

b) The company has been granted exemption by the Ministry of Corporate Affairs, from attaching with its accounts the individual accounts of each of its subsidiary companies subject to certain conditions.

c) Any shareholder may either ask for a copy or inspect at the Registered Office a copy of the audited accounts of the subsidiary companies (where required to be prepared).

ii. Tata Coffee Limited, a subsidiary of your Company, reported an increase of 5% in total operating income driven by better performance of plantation operations. Profits improved against previous year on account of higher dividends received from group companies along with improved performance by Plantation operations. The Directors of Tata Coffee Limited have recommended a dividend of Rs.7.50 per share of Rs. 10 each. Eight Oclock Coffee Company, USA, a subsidiary of Tata Coffee recorded a 20% increase in turnover and improved profitability driven by higher volume growth reflecting the continued brand strength and distribution gains in alternate channels.

iii. The Companys wholly owned subsidiary in USA,Tata Tea Inc. reported a 21% higher total income against previous year and profit after tax also improved significantly as compared to the previous year.

iv. Sales of Mount Everest Mineral Water Ltd., your Companys subsidiary dealing in mineral water was lower than the previous year due to softness in key account sales and deferment of retail roll out. The Company focused on cost reduction initiatives including rationalisation of distribution and launch expenses to improve performance. In an effort to reconfigure the distribution network, Mount Everest Mineral Water Ltd. has now entered into an agreement with your Company to manage its distribution. It is also expected that the distribution for this product will be significantly enhanced with the proposed alliance with PepsiCo.The directors recognise the long term potential of the business, the quality and uniqueness of the water source and the consumer appeal and are confident about the growth prospects which would deliver adequate returns on the investments made in that Company.

v. The Consolidated Accounts of Tata Tea (GB) Ltd., prepared in accordance with UK GAAP, reflect the financial performance ofTheTetley Group during 2009-10.Turnover recorded an improvement of 11%, attributable to price increases and some volume growth in most major markets but profitability reduced on account of higher commodity costs and increased investment behind brands and the global beverage agenda which is expected to fuel future growth.

vi. The company sold its stake in Rallis India Ltd. (RIL) which was an Associate of your Company in August 2009.

vii. Estate Management Services, Sri Lanka, where your Company holds shares and which is the holding company of Watawala Plantations Ltd. (WPL) had declared a dividend of 7.5% in 2008-09, which was received by us during the year.

viii. Amalgamated Plantations Private Limited, in which your company holds shares, recorded a significant improvement in profit mainly attributable to higher price realisation. During the year 2009-10 the company declared an interim dividend of 6% which was received by us during the year.

5. Proposed Joint Venture in Liquid Beverage Business

Your Company has signed an MOU with PepsiCo. Inc., USA for exploring the possibility of the formation of a Joint Venture in the area of non-carbonated ready-to-drink beverages, focused on health and enhanced wellness and is in discussion with PepsiCo in taking forward this initiative.The proposal envisages initially offering exciting health and wellness products in fortified and enhanced beverages and later diversifying into foods with intent to address nutritional and lifestyle challenges. This proposal is expected to result in a Joint Venture with PepsiCo and will potentially become a global beverage company oriented towards health and wellness.

6. Review of Domestic Activities

A. The Indian Tea Industry

The Indian Tea industry continued to see good demand with domestic consumption growing at approximately 4% per annum and improved prices as compared to the previous year. Crop at 979 million kgs during 2009 was more or less in line with the previous years crop at 981 million kgs. Exports were lower at 191 million kgs as against 203 million kgs in the previous year.

B. Domestic Branded Tea Operations

The Tata Tea brand continues its leadership position in the branded tea segment and leads market share in terms of both value and volume in India.The strength of the brands enabled significant recovery of commodity cost increases. TheTataTea brand was accorded "Super Brand" recognition in the country.

Brand Tata Tea Gold had a stellar performance in 2009-10 registering a 12% growth over the previous year driven by growth in value packs and a successful restageofthe brand in third quarter of the year.

Tata Tea Premium brand performance was marginally lower than the previous year. The performance of this brand has to be viewed in the context of the aggressive price increases the brand took ahead of competition. The launch of the new Jaago Re campaign supported by massive ground level activity followed by a Consumer Promotion on the lOOgm and 250gm packs saw the brand regaining its base in most markets.

With a view to add to the value-creating segment of tea bags, your Company restaged flavoured tea bags with a new flavour Ã Tulsi & Lemon. The launch was supported by PR coverage in the media, liquid sampling and created visibility in key accounts, website and magazines. Further to mark the occasion of the launch of the new flavour, your Company joined with a NGO to plant 3900 saplings of Tulsi.

One year of prototype in Tamil Nadu and was extended into the markets of Kerala, Goa and Karnataka in the last quarter of 2009-10. A new flavour, Orange Spice, was added to the existing portfolio. Consumer acceptance has been very good with Tlon having achieved a value share of 5% of the non-carbonated drinks market in Tamil Nadu.

Your Company will continue to aim to bring new and exciting brands that will appeal to modern lifestyle choices and to lead innovation in the beverage sector.

Your Company launched the new Jaago Re campaign -Aaj Se Khilana Bandh, Pilana Shuruduring the financial year under review. The new campaign takes up yet another relevant social issue- Corruption - and urges the citizens of the country to awaken and fight against it.The campaign transcends well beyond just creating an awareness and is being presented as a platform where every Indian citizen can bethe change he wants to seeby taking a pledge not to aid and abet corruption. This Campaign is a 360ÃÂ° integrated marketing campaign which connects with consumers across the retail network and through online and mobile touch points. A myriad of on-the-ground initiatives will take the message closer to people and contribute to the health of the nation. As part of the campaign your Company has also launched aVrathYatra covering a 38 day 6500 km long journey spanning 12 cities. The bus that did this journey created awareness on corruption and collected pledges from consumers to stop giving bribes. The Tata Tea brand and the Jaago Re campaign has been winning critical acclaim from all quarters. The Jaago Re campaign has won the Gold for the best consumer product campaign at the Emmies and the Indian Digital Media Awards for the best internet-based campaign.

Your Company carried a study on tea movement in India with a view to reducing its carbon foot print and also increasing the efficiency of tea movement from source centres to respective packing centres in India. Your Company is proposing to launch low-cost Tea Bags in the institutional segment for the Indian market.

C. International Branded Operations

The Companys subsidiaries had a strong performance in the international markets during the year under review. In all key markets, challenges posed by a strong commodity environment were offset partially by price increases made ahead of the competition whilst maintaining value market shares. Various initiatives were pursued to broad base the product category. These include Infusions in Canada, Redbush tea, Green tea and organic tea in the UK and Green tea in Australia. In the UK, an innovative jelly based drinkSUKKis being launched, after extensive consumer research. This product is aimed at the younger consumers and is an example of how the global innovation team is responding to market needs. Strong performances were recorded in all key markets viz., US, UK and Canada. In the US, our coffee business reported strong growth backed by brand strength and distribution gains. In the UK, volume and sales growth were recorded in a difficult trading environment. Across categories strong performances were recorded in Decaffeinated, Green and Redbush, with growth in market share. In Canada, the group continues to maintain its leadership position. Infusions launched in this market during last year have reported favourable growth and additional flavours were launched during the year. Growth was also reported in the Polish market backed by a media campaign and a reconfigured distribution arrangement. During the year under review, the companys subsidiary in the UK acquired a 51% stake along with the European Bank of Reconstruction and Development in the consolidated group of Suntyco Holding Limited, providing the group a presence in the tea and coffee market in Russia.This acquisition also provides the Group with market access to a critical market like Russia. Efforts are also on to tap into beverages potential in the Middle East and our products were launched in Saudi Arabia during the year under review.

D. Instant Tea

The production of Instant Tea powder at the Instant Tea Unit at Munnar for the year 09-10 was 40.48 lac lbs as against 40.79 lac lbs during the previous year. The marginal drop in production was due to lower productivity of the tea leaves. Consequent to lower production, sales of instant tea were also marginally lower.The unit has embarked on developing powders for customers based on their requirements on an ongoing and need basis. New products like decaffeinated instant teas and organic instant teas have also been developed. The plant at Munnar continues to be certified for Organic product manufacture.

Zhejiang Tata Tea Extraction Company Limited, China, which is a subsidiary of your Company, is a joint venture with a Chinese partner for setting up a manufacturing and marketing facility in China for Green Tea Polyphenols, tea extracts, instant tea and other value added tea beverage products. The project which was commenced last year has been successfully implemented and production has just commenced at the unit.

E. Exports

Total exports during the year at FOB value of Rs. 155.59 crores were higher than Rs. 136.73 crores achieved in the previous year. The Tea Bag unit at Kochi continued to meet the Groups requirements in Australia, Eastern Europe and Middle East and performed well during the year.

F. Plantation Operations

As the members are aware the Company had restructured its plantation operations by demerging its erstwhile North India plantations to a separate company, Amalgamated Plantations Private Limited (APPL). Your Company together with International Finance Corporation and employees of APPL are the current shareholders of APPL. During 2009-10 APPL had a record year both in turnover and profits, largely driven by the buoyancy in tea prices. The Hathikuli division of Hathikuli Tea Estate has received the organic certification and, by March 2011, the whole estate will be organic certified making it the single largest organic certified estate in the country.

Kanan Devan Hills Plantations Private Limited (KDHP), in South India to which your companys erstwhile 17 estates were transferred in 2005, also had a record year in its operations and has consistently paid dividends every year since its formation.

Your Companys residual two estates in South India which are managed by KDHP under a management contract have also done well. The crop production at these estates during 2009-10 was 21.94 lakh kgs representing an increase of 13% over the previous year. The crop achieved by these two estates is the highest since 2000-01.

G. Community Development, Employees Welfare and Environment Conservation

Your Company contributes significantly to social and community development through comprehensive welfare programmes that offer healthcare, education and other benefits. The Company has established a hospital, adult-literacy centres, childcare centres and schools to educate the children of the nearly 34,000 employees of its associate company, KDHP. These establishments continue to serve not just the employees and their families of KDHP but also of the community at large. Your Companys hospital was engaged in several community welfare activities in the form of conducting medical camps in surrounding villages, health examination of all the students at High Range School, continuing medical programmes for full sensitization and awareness on HIV and AIDs etc. In addition, the company specially focuses to address the needs of the "differently abled" children of the workers and they are trained in various vocations with a view to provide them with adequate skills and abilities. Srishti complex has recently set up a Bakery Unit as part of its efforts to provide meaningful training and occupation to the specially challenged members of the local community. Your Companys environment policy is focused on managing the nature and quantity of waste we create, and on the energy we use in our facilities and in the movement of goods and people. Your Company has institutionalised a process of Annual Welfare Audit conducted by renowned WHO experts, among the first Indian companies to do so.

Your Company is also allied with the Ethical Tea Partnership (ETP), a non-commercial alliance of over 20 international tea packers with a unified vision for a global tea industry that is socially just and environmentally sustainable. The ETP works to monitor and improve the social and environmental conditions under which tea is produced and to improve the lives of tea workers. It is also the intention to source all tea used in theTetleybrand globally from Rainforest Alliance CertifiedÃ farms by 2016.

7. Industrial Relations

During the year under review, industrial relations remained generally peaceful at all our offices and establishments.

8. Restructure of India Operations

Your Directors wish to inform you that with a view to unlocking synergies of operations and ensure that the Company operates in a more cohesive and coherent manner, it was felt desirable to consolidate some of the functions operating out of Kolkata with its office in Bangalore. The additional benefit of coming together will help accelerate the process of establishing a new beverage entity culture. The registered office will continue to remain at Kolkata and certain key functions like Tea Buying/Blending and Zonal sales office will also continue to function from Kolkata. The process of consolidation and relocation would result in inconvenience to some employees and your Company is addressing all the issues of the employees to make the transition in a smooth manner.

9. Corporate Governance & MD & A

A detailed report on Corporate Governance is separately attached together with a report on Management Discussion and Analysis (MDA).The MDA also covers the consolidated operations and reflects the global nature of our business.

10. Tata Business Excellence Model (TBEM)

The TBEM initiatives for your Company have now been integrated with that of subsidiaries and associates so as to encompass the entire group of companies as a single beverage business. The initiative will seek to describe the strategic direction of the organisation as well as how the people and processes across the business translate this into actions. The Senior Management and their teams lead market delivery and will play a key role to bring together the consumer and customer related process and outcome elements. The functional teams will ensure that their process and outcomes describe how they provide global support to the rest of the business.

11. Directors Responsibility Statement

Pursuant to the requirement of Section 217 (2AA)ofthe Companies Act, 1956 (the Act) and based on the representations received from the operating management, your Directors hereby confirm that :-

i) In the preparation of the Annual Accounts for 2009-10, the applicable Accounting Standards have been followed and there are no material departures.

ii) They have selected such accounting policies with the approval of the Statutory Auditors 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 the financial year.

iii) They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They have prepared the Annual Accounts on a going concern basis.

12. Directors

Incompliance with the Tata Group policy on retirement of directors, adopted by your Company, Mr. Y. H. Malegam and Mr. D. B. Engineer stepped down from the Board of the Company, with effect from 28th January, 2010, on their attaining the age of superannuation. Both Mr. Malegam and Mr. Engineer had been associated with the Company for a very long time and have made significant contribution to the growth of the Company. Your Directors wish to place on record their appreciation of the distinguished services rendered and the rich and valuable contributions made by both Mr. Malegam and Mr. Engineer.

At the Board meeting held on 28th January, 2010 your Directors appointed Mrs. Ranjana Kumar as an Additional Director of the Company with effect from 29th January, 2010, being the date of her receiving the Director Identification Number.

At the Board meeting held on 30th April, 2010, the Board appointed Mr. Ajay Shankar as an Additional Director of the Company with effect from 30th April 2010.

Both Mrs. Ranjana Kumar and Mr. Ajay Shankar hold office up to the date of the forthcoming Annual General Meeting and the Company has received separate notices from members informing his/her intention to propose the candidature of Mrs. Ranjana Kumar and Mr. Ajay Shankar as Directors of the Company.

Mr. R. N.Tata, Mr. F. K. Kavarana and Mr. U. M. Rao retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election.

Brief particulars and expertise of these Directors and their other directorships and committee memberships have been given in theannexuretothe Notice of the Annual General Meeting in accordance with the requirements of Listing agreement with Stock Exchanges.

All these directors have filed Form DD-A with the Company as required under the Companies (Disqualification of Directors under Section 274(1 Kg) of the Companies Act, 1956) Rules, 2003 .

13. Auditors

The Members are requested to appoint the Auditors and fix their remuneration. Messrs N. M. Raiji & Co., and Lovelock & Lewes, the retiring Auditors have furnished certificates of their eligibility for re-appointment as required under the Companies Act, 1956.

14. Particulars of Employees

Information as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this report. However as per the provisions of Section 219(1)(b)(iv)of the Companies Act, 1956, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Companies Act, 1956. Any member interested in obtaining such particulars may write to the Company Secretary for a copy thereof.

15. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

16. Concluding Remarks

Your Directors are sure that the shareholders would like to join them in conveying their appreciation to all employees of the Company for their sincere and dedicated services during 2009-10 without which such performance would not have been possible.

On behalf of the Board of Directors

(R.N.TATA) Chairman

Mumbai, 15th July, 2010

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