Page 64 - Tata_Chemicals_yearly-reports-2017-18

Nutritional Solutions FERTILISER BUSINESS (DISCONTINUED OPERATIONS)
FY 2017-18 was another milestone year in developing As mentioned above, the Company sold the Urea and Customised
infrastructure and capabilities. With a committed capital outlay Fertiliser business situated at Babrala, Uttar Pradesh to Yara India
of ` 270 crore, the construction of the world-class 5,000 MTPA effective 12 January, 2018. During the year under review, the
manufacturing plant at Mambattu, Nellore, Andhra Pradesh is Company also entered into a Business Transfer Agreement with IRC
on schedule. The business has also steadily built capabilities Agrochemicals Private Limited, a subsidiary of Indorama Holdings B.V.,
in IPR clinical studies, product conceptualisation through Netherlands, for the sale of its Phosphatic Fertilisers Business and the
customer partnership, complex fermentation technologies Trading Business comprising bulk and non-bulk fertilisers situated at
and gut microbiome data models. Haldia, West Bengal subject to certain regulatory and other approvals.
The business performance in FY 2017-18 was driven through a The Company is intending to close the pesticides and seeds business
mix of Prebiotics [Fructo-oligosaccharide (‘FOS’) and Galacto- and has considerably wound down the same during the year.
oligosaccharide (‘GOS’)] manufactured at Sriperumbudur In view of the above, the entire business is now classified as
near Chennai and complementary products in the food Discontinued Operations in the financial statements for the year
ingredient space. Supported by strong plant performance and ended 31 March, 2018.
encouraging customer response, overall in this financial year,
the business achieved a turnover of ` 33.80 crore, a jump of During the year, sales revenue of Discontinued Operations stood at
over 30.0% over the previous year. ` 4,086.91 crore against ` 4,616.80 crore in the previous year. The Profit
after Tax from Discontinued Operations was ` 1,142.49 crore against
Operations at Sriperumbudur remained stable and the plant
` 113.47 crore in the previous year (includes exceptional items of
supported the increased customer demand by producing ` 1,213.99 crore).
higher quantities across multiple grades of FOS. Project
execution at Nellore, Andhra Pradesh is underway with the FINANCE
ground-breaking ceremony performed in November 2017, The Company did not raise any long term borrowing during the year
civil construction is on track and most major equipment under review. In the month of October 2017, the Company repaid,
have been ordered. While sales of FOS and GOS continue to upon maturity, the 1 instalment of US$ 63.27 million relating to the
st
remain buoyant, our newly introduced product offerings external commercial borrowing of US$ 190 million raised during
also found wide acceptance in food and beverages, infant FY 2013-14.
nutrition, nutraceutical, pharmaceuticals and animal nutrition
As a result of efforts to improve net working capital and accretion
segments. A gross total of 1,700 tonnes of products were
of cash during the year, the short term financing requirements
sold in India to 600+ customers across 105 cities. With the
upcoming expansion, the business is in process of creating an reduced substantially during second half of the financial year. Any
international distribution network for select markets. requirements during the first half were satisfied through Commercial
Papers or working capital demand loans, all repaid during the year.
Advance Materials
Pursuant to the announcement of Special Banking Arrangement
The Company signed a Business Transfer Agreement with by the Department of Fertilizers, Government of India, during
M/s. Allied Silica Limited (‘ASL’), on April 7, 2018, to acquire March 2018, the Company availed loans against subsidy receivables
their business of precipitated silica, on a slump sale and going totalling ` 307.95 crore. The gross outstanding balance of subsidy
concern basis, for a consideration of upto ` 123 crore to be receivables as on 31 March, 2018 was ` 858.69 crore (31 March, 2017:
paid subject to fulfillment of certain agreed conditions and ` 1,684.41 crore).
milestones. The acquisition includes the existing manufacturing
During the year, overseas subsidiaries of the Company carried out the
site, which is recently commissioned, for precipitated silica at following refinancing exercises:
SIPCOT Industrial Park Phase II, Cuddalore, Tamil Nadu.
- Tata Chemicals International Pte. Ltd: Refinanced US$ 200
This acquisition is part of the ` 295 crore investment approved million for five years and repaid the existing loan of US$ 200
by the Board of TCL in February 2017 for entry into the Highly
million.
Dispersible Silica (‘HDS’) business. Upon completion of the
acquisition, this will represent yet another step in TCL’s journey - Homefield Pvt. UK Ltd: Refinanced US$ 28.50 million for five
to build technologically enabled, differentiated businesses, years and repaid existing loan of US$ 28.00 million.
with greater customer centricity while leveraging its core - Homefield 2 UK Limited group: Entities in the UK group prepaid
strengths. The manufacture of HDS is in line with our focus to
an existing term loan and revolving credit facilities totalling
grow our specialty business, along with our consumer business.
£ 133.20 million and entered into two separate facilities. Tata
Precipitated silica is a versatile product with applications in Chemicals Holdings Europe Limited and subsidiaries undertook
many industries including rubber, oral care, coatings and a new agreement for term loan and revolving credit facilities
agrochemicals. The acquisition also offers the possibility of aggregating £ 100 million for a tenor of five years (drawn at
producing high performance value added silica. This specialty 31 March, 2018: £ 89 million). Cheshire Salt Holdings Limited
chemical represents a downstream value addition to Tata and subsidiaries entered into new agreement for term loan and
Chemicals soda ash business, where it ranks among the top revolving credit facilities aggregating £ 55 million for a tenor of
manufacturers globally. five years (amount drawn at 31 March, 2018: £ 50 million).
The technology to manufacture HDS has been developed at In September 2017, the Company sold its investment of 4,31,75,140
the Company’s Innovation Centre in Pune. shares of Tata Global Beverages Limited, realising ` 920.07 crore.

62 Annual Report 2017-18