McLeod Russel India : Annual Report 2020 - 21

McLeod Russel India Limited

Annual Report

2020 - 21

Annual Report 2020-21

Corporate Information

BOARD OF DIRECTORS

Mr. Aditya Khaitan

Chairman & Managing Director

Mr. Amritanshu Khaitan

Non - Executive Director

Independent Directors

Mrs. Arundhuti Dhar

Mr. Suman Bhowmik

Mr. Raj Vardhan

Wholetime Director

Mr. Azam Monem

Chief Financial Oficer

Mr. Pradip Bhar

Company Secretary

Mr. Alok Kumar Samant (w.e.f. 19.06.2020)

BOARD COMMITTEES

Audit Committee

Mrs. Arundhuti Dhar

Mr. Suman Bhowmik

Mr. Raj Vardhan

Mr. Aditya Khaitan

Nomination & Remuneration Committee

Mrs. Arundhuti Dhar

Mr. Suman Bhowmik

Mr. Amritanshu Khaitan

Stakeholders' Relationship Committee

Mrs. Arundhuti Dhar

Mr. Suman Bhowmik

Mr. Azam Monem

Corporate Social Responsibility Committee

Mrs. Arundhuti Dhar

Mr. Aditya Khaitan

Mr. Azam Monem

Auditors

Lodha & Co.

14, Government Place East

Kolkata 700069

Solicitors

Khaitan & Co. LLP

REGISTERED OFFICE

Four Mangoe Lane

Surendra Mohan Ghosh Sarani Kolkata 700001

Corporate Identity Number CIN: L51109WB1998PLC087076 Phone No [phone]/2243-5391/2248-9434/35

Fax: [phone]-6265

Email: [e-mail]

Website : www.mcleodrussel.com

BANKERS

Indian Bank

(Erstwhile Allahabad Bank)

RBL Bank Limited

Axis Bank Limited

HDFC Bank Limited

ICICI Bank Limited

State Bank of India

UCO Bank

Punjab National Bank (Erstwhile United Bank of India)

Yes Bank Limited

IndusInd Bank

REGISTRAR

Maheshwari Datamatics Private Limited

23, R. N. Mukherjee Road 5th Floor, Kolkata 700001

Tel: [phone]-5029

1. 2231-6839Fax: [phone] Email: [e-mail]

Contents
STATUTORY REPORTS
Report of the Directors...........................................................................................................	03
Management Discussion and Analysis....................................................................................	12
Corporate Governance Report................................................................................................	15
Other Annexures ....................................................................................................................	31
FINANCIAL STATEMENTS
Standalone Financials.............................................................................................................	58
Consolidated Financials........................................................................................................	138
Details of Subsidiaries ..........................................................................................................	219

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Annual Report 2020-21

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Annual Report 2020-21

Report of The Directors

For the year ended 31st March 2021

Your Directors have pleasure in presenting the Twenty-third Annual Report with the Audited Financial Statements of your

Company, for the inancial year ended 31st March 2021.

REVIEW OF PERFORMANCE

The inancial results of the Company for the year ended 31st March 2021 are summarized below:

				Rs. in lakhs
			2020-21	2019-20
Revenue from Operations			111187	85670
Other Income			848	9317
Total Revenue			112035	94987
Proit before Finance Costs, Depreciation, Exceptional Items and Taxation		17375	13121
Less : Finance Costs			18720	21441
Less : Depreciation and Amortization Expenses			7075	6247
Proit/(Loss) before Exceptional Items and Tax			(8420)	(14567)
Add : Exceptional Items			-	11769
Proit before Tax			(8420)	(2798)
Tax Expense			(3137)	(4026)
Proit/(Loss) for the year			(5283)	1228
FINANCIAL PERFORMANCE	DIVIDEND
The past year was a challenging year for the Company with	In view of inadequate proit earned by the Company during
disruptions in production and sales owing to the pandemic	the year under review, the Board decided to not recommend
until. The operational turnover of the Company was higher	any dividend for the year ended 31st March 2021.
at Rs. 111187 lakhs against Rs. 85670 lakhs in the earlier	REVIEW OF OPERATIONS
year. The Company made a post-tax loss of Rs.5283 lakhs in	During the Financial year under review, the pandemic hit
the year under review as against a proit of Rs. 1228 lakhs
economy made it one of the most challenging times in
in the earlier year due to steep rise in costs of various inputs
the industry and all out efforts from the workers, staff
with proportionate rise in sale price.
and management kept operations eficiently on going. On

During the year the Company was not able to meet terms of	declaration of a nationwide lockdown, operations on the
facilities/loans availed from various Lenders. The Company	plantations came to a halt from 24th March 2020 until tea
is in discussion with the Lenders for restructuring/change in	estates reopened again in the middle of April 2020. The
lockdown of estates and subsequent unseasonal skifing of
terms of the loans. Accordingly the Lenders had appointed
tea bushes led to a further loss in crop resulting in a year
independent professionals for carrying out Techno
end shortfall of over 10%. Strict protocols and SOPs were
Economic Viability Study (TEV), valuation of business and
followed by all estates which largely prevented the spread
forensic audit, which were concluded successfully. Further
of Covid19 cases on the estates. The saleable production of
the investment banker appointed by the Lenders has been in
your Company was 439.22 Lakh Kgs tea, as compared to
extensive discussion for inalizing the Debt Resolution Plan,
419 Lakh Kgs in the previous year.
now pending before the Lenders for their consideration and
decision.	Improvement in plucking standards remained a priority and
	quality of leaf harvested improved considerably, resulting in
TRANSFER TO GENERAL RESERVE	a better quality of teas produced. Improved sales realization
The Board has decided not to transfer any amount to the	mitigated the loss in revenue as a result of the shortfall in
crop. The Uprooting and Replanting Policy of your Company
General Reserve for the year ended 31st March 2021.
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Annual Report 2020-21

continued to remain in focus and has further improved

the percentage of tea under ifty years which is now over

75% of the area. "Integrated Pest Management" practice continued as per past practice and was very effective resulting in improved pest control and reduced cost. Timely supply and application of fertilizer also controlled further crop loss. A high standard of Clonal Tea nurseries with requisite, approved Clonal Blend was established on all estates. The Shade Nurseries being of a good standard contributed as one of the key factors in developing a healthy plantation. The Afforestation program continues to be enhanced along with creation of new water-bodies, to improve the "micro-climate", in select areas which has become essential to counter the effects of climate change. Plantation of 'Agarwood' was undertaken as a pilot project, for revenue enhancement, on some estates.

It has always been Your Company's endeavor to produce Quality teas, which continued to command a premium, both in the domestic and international markets. Factory infrastructure and machinery was enhanced accordingly, to meet the requirements and Capital expenditure to

further improve processes were accordingly sanctioned. To improve ield operations and overcome the acute shortage

of workers by way of absenteeism, additional investments

in plucking Shears and Pruning machines were made available. Additions to the transport leet included Tractors to aid ield operations, and Ambulances to further improve

the medical facilities. To augment irrigation facilities new submersible pumps were installed on two estates, while to record an improvement on attendance of workers face recognition system were installed on thirteen estates.

The Company has thirty-one ISO 22000:2005 certiied

Factories which are in the process of upgradation to

ISO 22000:2018. Your Company also has three estates earmarked for "Fairtrade Certiication" and twenty seven estates certiied under "Rainforest Alliance." All our factories are certiied under the "Trustea" certiication and

we are also in the process of assisting our suppliers of leaf

from Small Tea Growers to become compliant under this certiication.

Your Company also participates in the Ethical Tea Partnership forum for international buyers and producers to promote sustainable practices jointly. Due to such initiatives we have set up 'Community Development Forums' on some of our estates, to enable welfare schemes mandated by the Government to reach our communities as well as bring about better awareness and improve the livelihood of our workers and their families.

We have also over the last four years, engaged with various organisations including UN Women, IDH, Dharmalife,

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BSR, Mercy Corps, ZvdZ Foundation, ETP and ITA to build awareness and provide responsible services among all levels of our employees, particularly women. Programmes such as 'Preventing Violence Against Women and Girls', 'Women's Safety Accelerator Fund', 'Work and Opportunities for Women', 'Global Alliance for Improved Nutrition', 'Project Sanitation' etc. now cover twenty-nine of our Estates in Assam and have proven to be most successful at building social awareness amongst women and children.

The Company has exported 72.00 lakh Kgs of Tea in 2020- 21 with an export turnover of Rs. 21405.50 lakhs. Favorable feedback was received from all buyers both in terms of quality and deliveries. Your Company continues to be the leading producer-exporter of tea with shipments to over seventeen countries worldwide.

CORPORATE INSOLVENCY RESOLUTION PROCESS (CIRP)

The Company was under Corporate Insolvency Resolution Process ("CIRP") pursuant to order dated 6th August 2021 passed by Hon'ble National Company Law Tribunal, New Delhi Bench, New Delhi ("NCLT") and the Hon'ble NCLT had appointed Mr. Kanchan Dutta having (Registration Number: IBBI/IPA-001/IP-P00202/2017-18/10391), as Interim Resolution Professional to perform the functions as mentioned under the Insolvency and Bankruptcy Code, 2016 (the Code). The powers of the Board of Directors was been suspended and such powers had been vested with the Interim Resolution Professional (IRP) and had since taken control of the management of the Company.

Further, the Hon'ble National Company Law Tribunal, New Delhi Bench, New Delhi ("NCLT") vide its Order dated 3rd September 2021 has withdrawn the matter. The suspension of the Board of Directors of the Company was restored and the Company get relieved from the clutches of Corporate Insolvency Resolution Process (CIRP) and IRP is discharged from his functions.

IMPACT OF COVID-19 PANDEMIC ON THE COMPANY

The pandemic is the most deining global crisis in living

memory. The virus was declared a global pandemic by the World Health Organisation (WHO) in March 2020. The Indian government implemented a nationwide lockdown in

late March 2020, which covered the comprehensive closure of ofices, factories and public places.

The Company has taken a series of measures in view of the COVID-19 pandemic to ensure health and safety of all our employees, workers etc., and to ensure compliance with various directives being issued by the WHO, Central Government, State Government and Local Authorities from time to time.