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Tata Global Beverage
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Directors Report Year End : Mar '15    « Mar 14
 Dear Members,
 
 The Directors are pleased to submit their fifty second report together
 with the audited financial statements of the Company for the year ended
 31st March 2015.
 
 Financial Results
 
 Rs. in crores                  Consolidated               Standalone
 
                            2014-15   2013-14     2014-15     2013-14
 
 Revenue from                 7,993     7,738       2,885       2,683
 Operations
 
 Profit from                    775       752         317         283
 Operations before
 Other Income,
 Finance Costs,                                                   
 Depreciation and
 Exceptional Items
 
 Less : Depreciation           (133)     (129)        (20)        (16)
 
 Profit from                    642       623         297         267
 Operations before
 Other Income,
 Finance Costs and                                            
 Exceptional Items
 
 Add: Other Income 
 (Standalone results
 includes intra-
 group dividends                 70         82        155         185
 eliminated on
 consolidation)
 
 Less : Finance Costs           (82)       (87)       (34)        (39)
 
 Profit before                  630        618        418         413
 exceptional items
 and taxes
 
 Exceptional items (net)       (130)        89        (69)        172
 
 Profit before tax              500        707        349         585
 
 Provision for tax             (216)      (185)       (60)       (138)
 
 Profit after tax               284        522        289         447
 
 Share of Net loss in           (11)       (13)        -           -
 Associates
 
 Minority Interest              (25)       (28)        -           -
 
 Profit for the year            248        481        289         447
 
 Add: Surplus brought         3,276      2,990        820         565
 forward from previous
 year
 
 Add: Transfer from              -          81         -           81
 debenture redemption
 reserve
 
 Add: Adjustment on              20          -         2            -
 Amalgamation
 
 Amount available             3,544      3,552     1,111        1,093
 for appropriation
 
 Proposed dividend             (142)      (139)     (142)        (139)
 
 Dividend distribution          (21)       (10)      (19)          (8)
 tax
 
 Transfer to debenture           -         (81)        -          (81)
 redemption reserve
 
 Transfer to general            (49)       (46)      (29)         (45)
 reserve
 
 Adjustment on                   (1)        -         (1)          -
 evaluation of useful
 life of Fixed Asset
 
                               (213)      (276)     (191)        (273)
 
 Retained in profit           3,331      3,276       920          820
 and loss statement
 
 State of company''s Affairs consolidated Performance
 
 For the year ended 31st March 2015, your Company''s consolidated Income
 from Operations at Rs. 7,993 crores registered a growth of 3%. The
 increase was higher at 5% at prior year exchange rates. The improvement
 in the topline reflects improved performance from our branded business
 and a stable performance from the non-branded business. Markets such
 as India, Canada, and Australia along with new businesses like
 Starbucks, NourishCo and MAP business in Australia contributed to
 revenue growth within the branded business. As regards the non branded
 business, while Coffee extraction sales were higher, plantation
 business was impacted by seasonality and pest infestation translating
 to lower crop available for sale.
 
 Profit from Operations at Rs. 642 crores grew 3% over the prior year.
 The improvement in operational profits was attributable to the improved
 performance in the branded business despite lower profits in the
 plantation business and higher spends in new ventures. The growth in
 income and profits were achieved in context of a highly competitive
 environment mainly in the international markets.
 
 Profit before and after tax was however lower because of the impact of
 exceptional items. Your Company recognised non-cash impairment losses
 amounting to Rs. 95 crores relating to businesses in China and Eastern
 Europe. The impairment relating to the China business is on account of
 delays in start up and stabilisation of technology for an enhanced
 product range. In the case of Eastern Europe, the goodwill impairment
 mainly relates to Russia and to a lesser extent to Eastern European
 branded business. In Russia, the impairment is arising due to adverse
 macroeconomic environment with resultant adverse impact on interest and
 discounting rates used for impairment assessment.
 
 The year saw a strong focus on the green and specialty tea category and
 innovative product launches. In the UK, Tetley launched a range of
 ''super green teas'' that are the first functional green teas in the UK
 with proven health benefits. The teas have added vitamins and premium
 natural flavours. In Canada, Tetley launched a premium line of
 specialty teas called the Tetley Signature Collection to reinforce
 Tetley''s leadership position in Specialty teas in Canada. In Poland,
 the Vitax brand launched Herbal Inspirations - a unique fusion of
 well-known herbal tastes with a hint of sweetness: Mint & Honey,
 Chamomile & Caramel and Lemon Balm & Vanilla. We have expanded our
 footprint in the Middle East with new distribution and new product
 launches with encouraging early results.
 
 In the coffee segment, the acquisition of the MAP brand gave TGB entry
 into the coffee segment in Australia in roast & ground coffee as well
 as the fast growing single serve segment.
 
 We are delighted to report that our strategic partnership with
 Starbucks and PepsiCo has reflected good growth.
 
 Standalone Performance
 
 Your Company''s Income from Operations for the year ended 31st March
 2015 was Rs. 2,885 crores, registering an improvement against the prior
 year, driven by increase in volumes and prices with improved
 performance of both national and regional brands. Profit from 
 operations at Rs. 297 crores was higher than previous year mainly 
 driven by top line improvements. Profit before and after tax was 
 however lower because of the impact of exceptional items. Your 
 Company recognised non-cash impairment losses amounting to Rs. 62
 crores relating to its investment in the China business. The impairment
 is on account of delays in start up and stabilisation of technology for
 an enhanced product range.
 
 The Indian business recorded good growth under the flagship ''Tata Tea''
 brand and most of the regional brands. We continue to be the market
 leaders in both volume and value terms. Your Company is pleased to
 announce record sales achieved in volume terms. In line with your
 Company''s strategy of promoting good for you beverages and
 recognising the consumer shift to health and wellness, the Indian
 operations strengthened focus on the green tea category. In addition to
 significant improvement in performance by Tetley Green tea, Tata Tea
 Acti green was launched aimed at popularising green tea and making it
 accessible to a wide range of consumers with convenient price points
 and milder blends, in exciting Indian flavours. Your Company is also
 the market leader in the green tea segment.
 
 Himalayan water, a brand inherited on amalgamation, is focussing on
 profitable growth. The brand profitability was impacted due to the
 imposition of an excise duty which was previously exempt and became
 applicable effective September 2014. Whilst, NourishCo, our JV with
 PepsiCo, is focussing on sale of this brand in the Indian market, your
 Company is also evaluating options for scale up in the international
 markets.
 
 Amalgamation of Mount Everest Mineral Water Limited with the company
 
 Pursuant to the Scheme of Amalgamation sanctioned by the Hon''ble High
 Courts at Calcutta and Himachal Pradesh, Mount Everest Mineral Water
 Limited (MEMW), a subsidiary of your Company, engaged in sourcing and
 selling of natural mineral water, has been amalgamated with the Company
 with effect from 1st April 2013. The Scheme came into effect on 18th
 May 2015 , the day on which both the orders were filed with the
 respective Registrar of Companies, and pursuant thereto the entire
 business and all the assets and liabilities, duties and obligations of
 MEMW have been transferred to and vested in the Company with effect
 from 1st April 2013.
 
 In consideration of the Scheme of Amalgamation, your Company will be
 issuing 1.27 crores equity shares to the shareholders of
 MEMW as of the Record date. Post issue of such shares, the paid up
 capital would go up 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 2014-15. The
 said dividend of Rs. 2.25 per share is also payable on the new equity
 shares to be issued to the shareholders of the erstwhile Mount Everest
 Mineral Water Limited on the amalgamation of MEMW with the Company. The
 total outgo on account of dividend, inclusive of taxes, for 2014-15 is
 Rs. 162 crores which represents a pay-out of 56% of the Company''s stand
 alone profits.
 
 Transfer to Reserves
 
 An amount of Rs. 28.90 crores is proposed to be transferred to General
 Reserves out of the amount available for appropriation and an amount of
 approximately Rs. 100 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 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 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 2014-15. 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 Clause 49 of the Listing Agreement. The Policy as approved
 may be accessed on the Company''s website at the link:
 http://www.tataglobalbeverages.com/our-investors/ governance
 
 Performance highlights of key operating subsidiaries / associates /
 joint ventures 
 
 indian Operations 
 
 Tata coffee Limited
 
 Tata Coffee Limited recorded a turnover of Rs. 684 crores during
 2014-15 compared to Rs. 651crores in the previous year, registering an
 increase of 5% attributed to improved instant coffee sales even as
 coffee plantation sales was impacted due to seasonality and tea
 plantation was affected by pest infestation translating to lower crops
 available for sale. The instant coffee export sales to regions other
 than Russia improved whilst sales to Russia were at the previous year''s
 levels. Coffee plantation operations however remained flat with volume
 shortfall being partially offset through better realisations. Profit
 from Operations for the year ended 31st March 2015, at Rs. 104 crores
 was lower than the previous year. Profit before and after Tax for the
 year 2014-15 was Rs. 142 crores and Rs. 102 crores vis-a-vis Rs. 148
 crores and Rs. 107 crores respectively in the previous year.
 
 The Directors of Tata Coffee Limited have recommended a dividend of
 Rs.1.30 per share for the year 2014-15 which is same as last year.
 
 To avoid over dependence on selected markets such as Russia, for the
 instant coffee export business, the management has continually focussed
 on newer geographies and witnessed improvements in sales by identifying
 new customers in various new countries. In keeping with the group focus
 on innovation, Tata Coffee launched new instant coffee products and new
 packaging as a hedge against commoditisation.
 
 The instant coffee operation in Tata Coffee continues to demonstrate
 their focus on process centric approach and operational discipline. As
 part of sustaining operational excellence, the Theni unit had been
 certified for ISO 14001,
 
 Halal & Kosher, BRC&IFS and Toopran unit was certified for ISO 14001
 and 18000. Both the Theni and Toopran sites won the CII Environment
 systems award for the year.
 
 Nourishco Beverages limited
 
 NourishCo Beverages Limited, the Joint venture with PepsiCo, is driving
 our water agenda in India. It distributes the ''Himalayan'' brand which
 operates in the premium segment, manufactures and distributes Tata
 Water Plus which is fortified water in the mass segment and Tata Gluco
 Plus in the enhanced water segment.
 
 Himalayan brand is focussing on profitable growth. A new TV
 advertisement for Himalayan went live on media in February 2015 to
 communicate the Himalayan ''Live Natural'' proposition and build source
 ''Himalayan''.
 
 Both Tata Gluco Plus and Tata Water plus reflected good growth through
 distribution expansion. NourishCo Beverages is now present in 7 states
 - Maharashtra, Gujarat, UP, MP, Karnataka, Tamil Nadu and Andhra 
 Pradesh. Tata Gluco Plus underwent a brand refresh including a 
 packaging change and a catchy TVC highlighting its glucose energy 
 benefit.
 
 Tata Starbucks Private Limited
 
 Tata Starbucks added 29 new stores during the year taking the store
 count to 72 stores as at the end of the financial year. The business
 continues to perform well and the overall performance of most stores
 continues to be robust. The company launched its loyalty programme
 during the year and received encouraging response. The focus during the
 year has been improving customer experience and sharing coffee
 knowledge. In order to achieve this, we commenced coffee master
 certification program and as at March 2015, we have 60 certified coffee
 masters. Our commitment to community continues to be a key priority at
 our stores and participated in 172 community initiatives during the
 year.
 
 Tata Starbucks which was originally incorporated as a Public Company
 under the name ''Tata Starbucks Limited'' was converted into a private
 limited company on 16th March 2015 pursuant to Section 18 of the
 Companies Act, 2013 and Rules framed thereunder.
 
 Amalgamated Plantations Private Limited (APPL)
 
 For financial year 2014-15, APPL''s turnover was in line with prior
 year. However, its performance was severely affected by lower crop due
 to severe drought conditions and higher wages reflecting wage revision
 during the year.
 
 Kanan Devan Hills Plantation company Private limited (KDHP)
 
 For financial year 2014-15, KDHP''s turnover was marginally lower than
 previous year. Profits were lower compared to previous year due to
 lower realisation in South India and increase in wages reflecting wage
 revision during the year.
 
 International Operations 
 
 Eight O clock coffee company (EOc)
 
 EOC''s total income during 2014-15 at Rs.1,008 crores, under Indian
 GAAP, was marginally lower than the previous year''s total income of Rs.
 1,026 crores. The reduction in top-line is due to lower bagged coffee
 volumes in the first half of the year.  However, in the second half,
 EOC volumes increased, driven by its popular consumer programs and
 effective promotional listings.
 
 EOC''s total Income also includes royalty income from the single serve
 K- cups sold under a licensing agreement with Keurig.
 
 K-cup volumes increased significantly year on year due to growth in the
 single serve business and addition of four new EOC SKU''s.  Overall
 profitability of EOC improved over the previous year.
 
 Tata Global Beverages Group limited, uk
 
 The consolidated income from Tata Global Beverages Group Limited UK,
 under Indian GAAP which substantially reflects the financial
 performance of the Tetley business and other international brands, at
 Rs 3,462 crores was flat over the prior year. At prior year exchange
 rate, the underlying growth is 3%.
 
 The underlying growth in sales is mainly attributable to growth in
 Canada, improvements in Australia and growth in Middle East. The
 Russian business had reflected an improved operating performance in
 underlying currency but currency devaluation resulted in a decrease in
 the reported numbers. Profit from Operations in underlying terms was
 lower than prior year levels due to one off costs and launch expenses
 incurred in Middle East.
 
 Non-cash goodwill impairment losses were recognised in these financial
 statements. The goodwill impairment mainly relates to Russia and to a
 lesser extent to Eastern European branded business. In Russia, the
 impairment arose due to adverse macroeconomic environment with
 resultant adverse impact on interest and discounting rates used for
 impairment assessment.
 
 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.
 Despite a tough year mainly due to the challenging market conditions
 with a marginal drop in sales, the Company posted an increase in its
 operating earnings against previous year driven by a combination of
 favourable product mix, improved realisation from the customers and
 lower input costs.
 
 The income from operations at USD 14.3 million was marginally lower
 than prior year. Net earnings after tax for 2014-15 was also marginally
 lower as compared to the previous year.
 
 china Joint Venture - Zhejiang tata tea extraction company Limited
 
 Delays continue in stabilisation of the China project. There has,
 however, been some improvement in recent months with stabilisation of
 production relating to certain product lines.  Alternative technology
 is being examined for other product lines. Going forward production
 stabilisation and establishing a pipeline of external customers in
 various overseas markets will be the key to the success of the project.
 
 estate Management Services Private limited (EMSPL)
 
 EMSPL, Sri Lanka in which your company holds 31.85% shares, is the
 holding company for Watawala Plantations Limited.  Watawala is one of
 the largest producers of tea and palm oil
 in Sri Lanka. During the year, the topline of EMSPL reflected a good
 growth over the prior year attributable to improved volumes.
 Consequently profitability has also been robust. The EMSPL group
 continues to perform well under difficult trading conditions.
 
 Companies which have become or ceased to be Subsidiaries, Associates
 and Joint Ventures
 
 During the year 2014-15, while TRIL Constructions Limited and Earth
 Rules Pty Limited became subsidiaries of the Company, Alliance Coffee
 Limited and B Jets Pte Limited ceased to be subsidiary and associate
 respectively. No company either became or ceased to be a Joint Venture
 during 2014-15.
 
 community Development, Employees'' Welfare and Environment conservation
 
 The Company pursued several community/ employee welfare activities, the
 highlights of which are as follows:
 
 * Symposium organised in Guhawati to announce the ETP - UNICEF
 partnership towards women empowerment. This is expected to cover 350
 communities over 100 estates in three districts in Assam.
 
 * General Hospital in Munnar and the Chubwa Hospital in Assam continued
 to provide quality medical services in their respective communities.
 The Muthuvan Tribal patients in Munnar are continued to be provided
 free medical treatment.
 
 * Your company continues to support the St. Judes India Childcare
 Centres, an organisation that provides needy children undergoing
 treatment for cancer with a clean, safe, hygienic place to stay along
 with nutritional support and transportation to hospital for treatment,
 as well as recreation, education and counseling.
 
 Human Resources and industrial Relations
 
 During the year under review, industrial relations remained harmonious
 at all our offices and establishments. Two long-term wage settlements
 were signed at Cochin and Munnar.
 
 We sustained our focus on attracting and nurturing talent and
 developing organisational capabilities in order to strengthen the
 foundation for future business growth.
 
 As part of re-energizing the organisation, people managers created
 impact plans, post the last Employee Engagement survey, in
 collaboration with their teams, and put those to action.  Investment
 was made in enhancing people manager''s capability in driving high
 performance and unleashing the potential of their teams. A new Global
 program named Brewing Brilliance was launched in order to create a 
 culture of appreciation and recognition; which is playing an important 
 role in strengthening the high performance culture and people feeling 
 valued.  Leadership effectiveness was also improved through the 3600 
 survey which provided feedback to senior leaders on Tata Leadership 
 practices.
 
 We consistently improved our Affirmative action initiatives in the
 areas of Employment, Employability, Entrepreneurship and Education. A
 need and impact study was conducted through Tata Institute of Social
 Sciences (TISS) to help sharpen our Affirmative action strategy.
 
 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.
 
 Business Responsibility Report
 
 Vide its Circular dated 13th August 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 31st March 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.
 
 Tata Business Excellence Model (TBEM)
 
 At TGB, we have been focussing on nurturing the company''s internal team
 to create ''Quality'' conscious leaders, who will support our journey of
 business excellence. Towards this end, we have conducted programs on
 Essentials of Excellence across our 3 regions covering employees
 across functions and regions.  TBEM 2014 External Application was
 completed and submitted to Tata Quality Management Services on time,
 involving 100  employees in the application writing process this year.
 TGB''s score on TBEM has moved up the excellence band and is now in the
 450 - 550 which indicates Good Performance. TBEM action plan workshops
 were conducted in the 3 regions in February and March 2015, to develop
 action plans on areas for improvement and to enable us to move forward
 in the excellence journey.
 
 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 
 adequate safeguards against victimization 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 adequate system of Internal Controls which are detailed
 in the Management Discussion and Analysis Report.
 
 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 agreement. 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 Nomination and Remuneration Committee (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 Clause 49 of the Listing Agreement. 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 recognised 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.
 
 The non-executive Directors, including Independent Directors, are paid
 Sitting fees for attending the meetings of the Board and Committees of
 the Board. The Company paid a fee of Rs. 20,000 per meeting per
 director for attending meetings of the Board, Audit and Executive
 Committees. For meetings of all other Committees of the Board, a
 Sitting fee of Rs. 10,000 per meeting per director was 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 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 ended 31st March
 2019. No Stock option has been granted to the Non-Executive Directors.
 
 The NRC is also responsible for developing competency requirements for
 the Board and in this regard conducts a gap analysis to determine the
 Board composition on a periodic basis including each time a directors
 appointment or reappointment is required. The NRC has framed a policy
 to determine the
 qualifications, positive attributes and independence of a director.
 The key features of the policy 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 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
 meet the criteria laid down in Section 149(6)bof the Companies Act, 
 2013 and Clause 49 of the Listing Agreement.
 
 Number of meetings of the Board
 
 Six meetings of the Board of Directors were held during the year
 2014-15. 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
 
 The Corporate Social Responsibility (CSR) Committee has framed the
 Natural Beverages Policy which is its CSR policy indicating the
 activities to be undertaken by the Company which has been approved by
 the Board. The objective is to contribute to our vision to be the most
 admired natural beverages company in the world, and strive to be the
 consumer''s first choice in sustainable beverage production and
 consumption. This is built around five pillars of sustainability -
 community development, sustainable sourcing, climate change, water
 management and waste management.
 
 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/document-
 manager/csr-policy.pdf?sfvrsn=2
 
 During the year under review, the Company has spent Rs. 3.91 crores
 (around 2.10 % 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 under CSR activities under
 section 135 of Companies Act 2013, the Company has also carried out
 several other sustainability / welfare initiatives and projects on a
 global level.
 
 In 2014, for the third year in a row, Tata Global Beverages (TGB) was
 recognised on the Climate Disclosure Leadership Index (CDLI), and
 ranked first in the Consumer Staples sector in India by CDP Our carbon
 intensity has decreased by 28% over the past three financial years. In
 August 2014, TGB initiated Project Sustainable Plant Protection
 Formulation (S-PPF), which is a collaboration between Tata Group
 companies - TGBL, Rallis, Tata Chemicals, Amalgamated Plantations
 (APPL), Kanan Devan Hill Plantations (KDHP) and Tata Coffee. S-PPF is
 being implemented with the objective of developing a portfolio of
 bio-pesticides and corresponding package of practices. TGB is committed
 to 100% sustainable sourcing of its tea by 2020. Tetley has achieved
 63% Rainforest Alliance certified tea in FY 2014-15. TGB is one of the
 founding members of trustea - the India Sustainable Tea Code which is a
 multi-stakeholder initiative led by the Tea Board of India. The program
 has the ambitious goal to sustainably transform 500 million Kg of
 Indian tea and make a positive impact on the livelihood of 500,000 tea
 plantation workers and 40,000 small holders by 2016. During the year,
 KDHP set an industry benchmark by facilitating 1260 small tea growers
 in Wayanad and Idukki regions of Kerala to achieve both the Rainforest
 Alliance and trustea certifications. In Tata Coffee, water catchment
 areas are identified with GPS survey and 227 large water storage
 reservoirs equivalent to 110 hectares of water area have been built to
 store 583 million gallons (2.2 billion litres) of water that meets 95%
 of the annual water requirements in the plantations. The Company also
 supports a general hospital and school in Munnar which caters to the
 Company employees, its associate Company as well as the local
 communities. The Company as a part of its business activities pursues
 various social and rural engagement initiatives. The Gaon Chalo
 program, our effort in last mile rural distribution, is present in 18
 states with direct reach in 70,000 villages. The Jaago Re- Power of 49
 campaign had over 2 million direct interactions and 0.8 million issues,
 and 1.2 million fans on facebook. The Company maintained leadership in
 gender diversity of 39.1% for graded employees globally.
 
 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 149 (14) of the Companies Act, 2013 the details of
 remuneration received from the Managing and Executive directors from
 the Company''s subsidiary company during 2014-15 is 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
 
 During the year, your Directors have constituted a Risk Management
 Committee which has been 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, credit, market, liquidity,
 security, property, IT, legal, regulatory, 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 and the Risk register and the mitigation measures 
 periodically which was hitherto being carried out by the Audit 
 Committee. 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 thereunder 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 2015.
 
 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 2014-15 is attached herewith as Annexure 4.  There are no
 Secretarial 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 2015, 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 2015 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 existing system of internal financial controls and
 compliance systems established and maintained by the Company, 
 work performed by the internal, statutory and secretarial auditors 
 and representation made by the Management to 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 2014-15.
 
 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 Clause 49 of the Listing Agreement.
 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 within 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 2014-15 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 Pandole and Mrs. Ireena Vittal 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 Clause 49 of the Listing Agreement. 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. S Santhanakrishnan and Mr. Harish Bhat retire by rotation at the
 forthcoming Annual General Meeting and being eligible, offers
 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.
 
 No Director has been appointed or has retired or resigned during the
 year under review.
 
 Mr. K. Venkataramanan, Chief Financial Officer of the Company was
 transferred to Tata Coffee Limited with effect from 25th October 2014
 and Mr. John Jacob was appointed as the Chief Financial Officer in his
 place. Other than this, no other Key Managerial Person has been
 appointed or 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 second Annual
 General Meeting till the conclusion of the fifty third Annual General
 Meeting. The Auditors'' report on the financial statements for the year
 2014-15 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 2015-16.  The members are
 requested to ratify the remuneration payable to the Cost Auditors for
 2015-16.
 
 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.
 
 Details of the familiarisation programme of the independent directors
 are available on the website of the Company
 http://www.tataglobalbeverages.com/docs/documents/tgbl-
 familiarisaiton-programme-for-ids.pdf?sfvrsn=2.
 
 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 2014-15.
 
                                   On behalf of the Board of Directors
 
 Mumbai,                                               CYRUS P. MISTRY
 28th May 2015                                                Chairman
Source : Dion Global Solutions Limited
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