Page 124 - Tata Chemical Annual Report_2022-2023
P. 124

Integrated Annual Report 2022-23                01-83                   84-192                  193-365
                                                                                                                                     Integrated Report       Statutory Reports       Financial Statements
                                                                                                                                                             Board's Report


               the increased requirement. The Company recorded highest   substantially higher to reflect higher raw material and       together with ongoing application development have   rates, high inflation and supply-chain disruptions, the
               ever production of salt at 13.2 lakh MT during FY 2022-23.    energy cost inputs.                                       enabled the Company to serve customers across the globe.  Company kept  the  focus  on  accelerated  pre-payment
               In addition, a project is under implementation to increase                                                                                                                 of loans at its overseas subsidiaries while at the same
               the salt manufacturing capacity to meet the projected        The UK Operations maintained core UK market share           In addition to continuing growth from the USA and South   time proactively responded to the global situation by
               demand increase. On the manufacturing side, solar salt   with slightly reduced exports into Europe in line with the     East Asia markets, there has been encouraging potential   negotiating  competitive margins during refinances,
               production was affected due to brine dilution owing to   above. The combined heat and power (CHP) facility at           also opening up from the European Union. The facility   arranging appropriate trade finance facilities to realign
               extended rains and flooding.                      Winnington performed well through the year generating                 has been qualified by some global customers placing the   with the working capital requirements and broadening
                                                                 good electricity margins despite volatile and high natural            Company on the path of achieving full capacity utilisation in   the investment avenues to enhance blended yield on
               Other Products                                    gas prices throughout the period.                                     the coming year. There were specific intervention projects   deployment of surplus cash balances.
                Sale of  cement  stood  at 4.8 lakh MT, an improvement                                                                 undertaken to improve efficiencies and cost of operations.
               of 13.7% over previous year.  Bromine production was       In the Salt business, sales volumes were steady amid rising                                                      The Company’s overseas subsidiary, Tata Chemicals Magadi
               impacted due to bittern dilution.                 energy costs and price was increased in the market to                 Subsidiary                                         Limited, Kenya, pre-paid its entire term loan outstanding
                                                                 reflect the same.                                                     Rallis India Limited (‘Rallis’)                    of  US$  36  million  during  the  year.  Term  loans  at  Tata
               Subsidiaries                                                                                                            (as per TCL consolidated books)                    Chemicals International Pte Limited ('TCIPL'), Singapore and
                 Tata Chemicals North America Inc., USA (‘TCNA’) (as per       EBITDA for FY 2022-23 for the UK Operations was £ 63.6       Rallis India Limited, the Company's listed subsidiary, has   Homefield Pvt UK Limited amounting to US$ 200 million
               USGAAP)                                           million (` 615 crore) against £ 11.6 million (` 118 crore) and        been serving Indian farmers and Global markets through   and US$ 28.5 million respectively, were refinanced and
                                                                 the profit after tax was £ 45.0 million (` 435 crore) against         its products in Crop Protection, Crop Nutrition and   consolidated at TCIPL, Singapore. £ 80 million term loan
                During FY 2022-23, overall revenue for TCNA increased   the loss of £ 8.4 million (` 85 crore) in the previous year.   Hybrid Seeds. Rallis achieved revenue from operations of   at UK was refinanced with a new loan of £ 70 million and
               by 32% to US$ 655.7 million (` 5,271 crore) from                                                                        ` 2,967 crore in FY 2022-23 compared to ` 2,602 crore in   balance was repaid. Tata Chemicals North America has
               US$ 495.0 million (` 3,688 crore) due to increased realisation        Tata Chemicals Magadi Limited, Kenya (‘TCML’)     FY 2021-22, an increase of 14%. The profit after tax stood    repaid US$ 85 million, ahead of the schedule, during the
               offsetting a small volume reduction of 2%.        (as per IFRS)                                                         at ` 92 crore, down by 44% against a profit after tax of    year under review.
                                                                                                                                       ` 164 crore in FY 2021-22.
                EBITDA registered an increase of 51% to US$ 160.3 million       During FY 2022-23, sales volumes were lower by 10%                                                         During FY 2022-23, Rallis, a subsidiary and IMACID, a joint
               (` 1,288 crore) against US$ 106.0 million (` 790 crore) in   over FY 2021-22. TCML achieved a revenue of US$ 117.6       During FY 2022-23, the Domestic Crop care business   venture, paid dividends of ` 29 crore (FY 2021-22: ` 29 crore)
               FY 2021-22. This increase in business performance led to   million (` 945 crore) for FY 2022-23 as against revenue of    of Rallis achieved a revenue of ` 1,643 crore as against   and ` 92 crore (FY 2021-22: ` 28 crore) respectively to the
               TCNA registering a profit after tax and non-controlling   US$ 77.4 million (` 577 crore) in the previous year, an       ` 1,468 crore in FY 2021-22, an increase of 11.9%. This is in   Company. Tata Chemicals South Africa (Pty) Limited paid
               interest of US$ 90.7 million (` 729 crore) during FY 2022-23   increase of 52%. For FY 2022-23, TCML registered an EBITDA   the context of the industry facing headwinds from erratic   a dividend of South African Rand 5.0 million (`  2 crore)
               compared to a profit of US$ 49.9 million (` 372 crore) in   of US$ 58.3 million (` 468 crore) against the EBITDA of     rainfall and lower pest infestation across the majority of   [FY 2021-22: South African Rand 30.0 million (` 15 crore)].
               FY 2021-22.                                       US$ 19.2 million (` 143 crore) in the previous year, higher           the crops. Large part of the growth in the Agrochemicals
                                                                 by 204%.  The increase in EBITDA was due to better                    industry in general and Rallis in particular has been driven   TC Africa Holdings Limited paid a dividend of £ 0.3 million
               TCE Group Limited, UK (‘TCE group’) (as per IFRS)  realisations and cost control. TCML recorded a net profit of         by price growth.                                   (` 3 crore) [FY 2021-22: £ 1.5  million (` 15 crore)].
                                                                 US$ 55.9 million (` 450 crore) in FY 2022-23 against a net
                TCE Group Limited’s business consists of soda ash, sodium   profit of US$ 12.7 million (` 94 crore) in FY 2021-22.      The International business of Rallis grew by 24.5% to       For the year under review, the Company’s credit ratings
               bicarbonate, and energy units and British Salt Limited                                                                  ` 979 crore in FY 2022-23 from ` 787 crore in FY 2021-22.   were reaffirmed. Fitch Ratings upgraded the outlook to
               which manufactures and sells food and industrial grade   5.2  Specialty Products                                        Growth was competitive and well balanced between price   ‘Positive’.
               white salt.  Together they are referred to as ‘UK Operations’   Standalone                                              and volume.
               of the Company in this Report.                      Silica                                                                                                                  The Company as on March 31, 2023 had the following
                                                                                                                                        Revenue of the Seeds division of Rallis decreased by 1.3%   credit ratings:
                                                                  Tyre demand during FY 2022-23 had  normalised.
                The turnover from the UK Operations for FY 2022-23 was                                                                 over the previous year to ` 345 crore. The business continued      -    Long Term Corporate Family Rating – Foreign Currency
               £ 271.5 million (` 2,629 crore) against £ 191.5 million    Tyre labelling norms will continue to drive demand           to witness challenges for the second year in a row. Reduced   of Ba1/Stable from Moody’s Investors Service
               (` 1,949 crore) in the previous year, registering a growth   of highly dispersible silica (HDS). Silica margins in      demand for Hybrid Paddy and the presence of illegal cotton
               of 42%.                                           FY 2022-23 were impacted by a steep increase in raw                   seeds impacted the industry. Profitability was impacted      -    Long Term Foreign Currency Issuer Default Rating
                                                                 material and energy costs.  The Company's primary                     due to inventory provision & impairments of intangibles   (IDR) of BB+ with Positive outlook from Fitch Ratings
                In a year dominated by high and volatile natural gas prices,   focus will be on scaling use of HDS in tyre to protect   of ` 83 crore. Their portfolio has also faced challenges with      -    Long  Term bank facilities (fund-based limits) of
               soda ash sales volumes were steady throughout the year   overall realisations.                                          some of the product launches not scaling up as per the   ` 1,300 crore and short-term bank facilities (non-fund
               with slight softening of demand in the chemicals and                                                                    expectations. High fixed costs have also limited operating   based limits) of ` 2,000 crore are rated at CARE AA+
               construction sectors witnessed later in the year. Sales of       Prebiotics & Formulations                              leverage impacting the overall profitability of the business.   (Outlook: Stable) and CARE A1+ respectively, by CARE
               high-grade sodium bicarbonate remained consistent       The Company stabilised its operations at its state-of-                                                                 Ratings and
               compared to FY 2021-22, with some softness latterly   the-art greenfield facility in Mambattu, Andhra Pradesh.      6.  Finance and Credit Ratings
               in relation to lower technical grades in the Central &   Food safety certifications (FSSAI, FSSC 22000, FAMI QS,         Amid the geopolitical conflict and a global macro-economic      -    Commercial Paper of ` 100 crore is rated at CRISIL A1+
               Western Europe market. Prices for both products were   Halal, Kosher), strong scientific backing, regulatory support,   scenario of pressing energy inputs costs, rising interest   by CRISIL Ratings



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