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growth in diverse areas which include lead processing, tobacco, Potential risks for the UK operations would include a margin reduction
silicate, disinfection, animal feed, compost treatment, jigger treatment, if sales prices do not offset increases in commodity raw materials and
flu gas treatment amongst many others. an inability to pass on carbon emission tax rises. The Brunner Mond
pension scheme will undertake the regular triennial valuation exercise
Risks and Opportunities
during 2018.
The Company is working to address key opportunities and risks in the
At TCML, the focus is largely centred on the growth of value added
business environment in alignment with its growth strategy.
products and successful penetration into new and emerging markets.
In order to strengthen TCL’s leadership position in the growing Developing alternative sources of energy, utilisation of Lean Six Sigma
domestic market, ICO is pursuing capacity expansion options for all the and Lean Manufacturing tools and techniques, continuous process
key product lines at Mithapur subject to receipt of required statutory improvement and, enhanced global sourcing will help reduce costs
clearances. This volume driven growth plan is being supplemented and improve efficiency. Attracting and retaining the right talent,
by plans to address value-driven growth opportunities in select developing alternative employee welfare mechanisms are some of
product lines like bicarb where the Company is focusing on scaling the other opportunities identified by TCML for the coming year.
up of Medikarb volumes along with launching new high value grades. At TCML, some of the key risks include raw material (Trona) quality,
The business is also leveraging digital platforms for enhanced ease affected by increased siltation in the northern part of the Lake Magadi,
of doing business; building customer partnerships around themes of
a deteriorating road infrastructure, political and environmental
innovation and sustainability which continue to offer opportunities regulations, water scarcity and other environmental pressures. In
for stronger customer connect. Finally, several projects around plant response, the Company continues to increase engagement with local
and supply chain upgrade and automation are also expected to be
and national stakeholders and supports concerted efforts, including
executed in the coming year.
technical collaboration with third parties, to mitigate these risks.
ICO is also taking requisite measures to address the key risks to the Salt and Related Products
business. Pressure on soda ash prices due to unfavourable demand-
supply balance, higher energy costs and volatility in exchange rates Industry Structure and Developments
are the most significant risks to the business performance. The
Company continues to remain focused towards keeping fixed costs India is the third largest salt producer after China and USA. The total
low and controlling variable costs through securitisation of the key annual production of common salt in India, on an average, is about 28
million tonnes^. Production of iodised salt is around 66 lakh tonnes.
raw materials including fuel and limestone along with continuous
improvement programs to help mitigate the adverse impact of Branded, packaged edible salt is about two thirds of the edible salt
these risks. Adherence to more stringent environmental norms and consumed and growing at 9% in FY 2017-18 (Nielsen). During the
year, monsoons were well distributed and edible salt supply and
improving the safety performance in a sustainable manner are other
key areas which the India Chemicals business plans to continue to demand remained steady throughout the year.
focus on during FY 2018-19. The branded salt share of the market continues to increase due to
awareness of better product quality, visible purity and iodine content.
At TCNA, the focus is on the continuation of production stabilisation
started in FY 2016-17, cost reduction and business optimisation. Specialty salts like rock salt and black salt have an increased presence
Business optimisation measures include Zero Based Budgeting in modern format stores.
project; targeting a reduction in non-manpower fixed costs, pursue ^Source: Salt Annual report 2016-17 - Salt Commissionerate,
an alternative coal source to significantly reduce costs and risk, and Government of India (trailing 3 year average)
investigation of future port and rail fleet strategy. TCNA has received
a significant benefit from the US tax reforms with the continuation of Performance of Salt and Related Products
the mining percentage depletion allowance, removal of Alternative Tata Salt continues to be the leader in the national branded salt
Minimum Tax (‘AMT’) and a reduction of the corporate tax rate.
segment. Tata Salt Lite continues to be the leading brand in the low
Rigorous project management and continued engagement with all sodium salt segment and Tata Salt Crystal leads in the Crystal salt
stakeholders are critical to managing risks in TCNA. TCNA faces the segment. Salt sales volumes have grown by 3.5% p.a. since FY 2014-15
impact of new tonnes from expansion and greenfield production primarily driven by the flagship brand Tata Salt which has grown by
of low cost Turkish natural soda ash entering the market through 5.2% p.a.
FY 2018-19 as well as an increase in domestic competition due to
Tata Salt reaches 1.8 million retail outlets across India. This has been
aggressive pricing from competitors for market share as export tonnes
are realigned. Tightening regulatory and environmental legislation achieved through driving supply chain efficiencies and enhanced use
means that the Direct Sorbent Injection (‘DSI’) Project (Environmental of IT and analytics, along with a thrust on distribution and branding.
Constant brand building efforts through enhancing visibility at retail,
Compliance) will be operational in 2018 while the Company continues
to focus on the management of waste. consumer activations and support through both traditional and
digital media, have helped strengthen the Tata Salt brand amongst
In the UK, there is a strong investment pipeline of projects in both salt consumers. The Company moved towards building a stronger narrative
and sodium bicarbonate/soda ash/energy driving towards increasing on health, with the “Sawaal kijiiye apne namak se” campaign, bringing
cost competitiveness and customer service. These projects will start forth the evaluation criteria for better-quality salt and establishing the
to be implemented in FY 2018-19 with others completing major superiority of Tata Salt through easy-to-understand demonstrations.
pre-construction milestones ahead of FY 2019-20. Growth in sales The Company also reached out to consumers through various tactical
opportunities in Asia in sodium bicarbonate/salt will continue to bear campaigns like “Mithapur express” and “Sehat ka Charger”.
fruit as a result of dedicated projects.

96 Annual Report 2017-18