Contents CORPORATE OVERVIEW Bringing Smiles to Life 01 Introduction to Tata Chemicals 02 Geographical Presence 03 Key Financial Highlights 04 Governance 06 Customer at Heart 08 Living Essentials 10 Industry Essentials 16 Farm Essentials 22 People 28 Sustainability 30 Innovation 32 Results at a Glance 33 STATUTORY REPORTS Board’s Report 34 Management Discussion and Analysis 72 Corporate Governance Report 94 FINANCIAL STATEMENTS Standalone Financial Statements Independent Auditors’ Report 110 Balance Sheet 116 Statement of Profit and Loss 117 Cash Flow Statement 118 Notes forming part of the Financial 120 Statements Consolidated Financial Statements Independent Auditors’ Report 152 Consolidated Balance Sheet 156 Consolidated Statement of Profit and Loss 157 Consolidated Cash Flow Statement 158 Notes forming part of the Consolidated 160 Financial Statements Form AOC – 1 (Financial Information of 199 Subsidiary Companies) Business Responsibility Report – Summary 201 Notice 202 Financial Statistics 211 Attendance Slip / Proxy Form 215 BRINGING SMILES TO LIFE India’s first national brand of packaged iron fortified iodised salt. Through the Tata Sampann brand, the Company aims to provide everyday nourishing foods for a healthy living. The brand houses High Protein Unpolished pulses range, Low oil-absorb besan made from 100% chana dal and the uniquely developed range of spices for today’s homemakers who are looking at providing wholesome food to their family without compromising on taste. Tata Swach water purifiers are an innovative solution for water purification to masses. In line with its focus on health and nutrition, the Company has developed a range of nutritional products under the brand Sustentials to provide innovative wellness food solutions. The products manufactured under this brand include FossenceTM (fructo-oligosaccharides), GossenceTM With the customer at heart, Tata Chemicals (TCL) (galacto-oligosaccharides) and other polyols and is leveraging the passion and excellence of its oligosaccharides. people to develop a deeper understanding of its The Industry Essentials products are vital inputs customer’s needs, while providing pioneering to diverse industries. These include glass, and innovative products that deliver smiles to all detergents, sodium silicate, textiles, food, feed, its customers. mining and chemical processing. The Company At Tata Chemicals, we work to harness the endeavours to add value to life by making fruits of science for goals that go beyond everyday products better and smarter. business. This is encapsulated in our vision of The Farm Essentials offers multiple farm inputs ‘Serving Society Through Science’. A part of this that are required to improve crop health and vision is to provide sustainable and innovative productivity. These include fertilisers, pesticides, products that support and enrich life and specialty nutrients, seeds and agro-services. The brings smiles to millions. These include not Company is also a key player in the segment of just our customers and consumers but a wide specialty fertilisers and customised fertilisers that gamut of stakeholders we serve – ranging from provide balanced crop nutrition to the soil. Tata communities and society, to employees and Kisan Sansar (TKS) and Rallis Kisan Kutumb (RKK) shareholders. is a network that offers services which enable TCL works on the Tata Group’s ethos of ‘Customer farmers in creating and generating farm produce Promise’ through its 3Ds of ‘Develop, Deliver by offering information on new and improved and Delight’. agronomic practices and facilitating use of agricultural inputs. Our Living Essentials products positively touch the lives of millions. We are the pioneers in the With initiatives that nurture relationships, Tata branded Iodised salt segment and also launched Chemicals is working to bring smiles to LIFE! INTRODUCTION TO TATA CHEMICALS Part of the over $100 billion Tata Group, Tata Chemicals Ltd. serves customers across five continents, with sustainability and innovation at the core of its business. TCL today is the world’s second largest producer of soda ash, reaches over 650 million consumers through its Tata Salt brand and touches 85 percent of India’s arable land through its agri business, together with its subsidiaries Rallis India and Metahelix Life Sciences. House of Strategy Mission Serving Society through Science Vision To be a sustainable company with deep customer insights and engaging relationships with all stakeholders in industrial chemicals, branded agri and consumer products. Living Industry Farm Essentials Essentials Essentials Aim to provide branded everyday Be a global leader in inorganic Be a leader in farm inputs and nourishing foods to over 1 billion chemistry solutions serving the agri solutions aiming to serve Indian consumers world’s leading brands over 25 million farmers Technology enabled differentiation Values Safety Passion Integrity Care Excellence Cultural Pillars Proactive Cost Focus Agile Execution Collaborative Innovation Trusting Relationships 2 CORPORATE OVERVIEW Geographical Presence Americas Europe Africa Asia 1 Green River Basin, 2 Northwich, Lostock 3 Jorf Hasfar, 5 Mithapur, Gujarat 9 Babrala, UP Wyoming, US & Middlewich, UK Morocco (JV), 6 Ankleshwar, Dahej, 10 Haldia, West Bengal North Africa Gujarat (Rallis) 11Sriperumbudur, 4 Magadi, Kenya 7 Lote, Maharashtra (Rallis) Tamil Nadu 8 Akola, Maharashtra (Rallis) 12 Bengaluru, Karnataka (Metahelix) HO: Mumbai, India 559 393 249 3,105* *excluding Rallis and Metahelix Canada, USA, Mexico, Europe and UK South and East Africa India, Bangladesh, Indonesia, Brazil and Argentina Sub Saharan Africa Malaysia, Thailand, Philippines 2 1 3 9 5 10 6 8 4 7 12 11 Head Office Manufacturing Facilities Employees Markets Segmental Revenue (Consolidated) (%) Segmental Results (PBIT) (Consolidated) (%) Geographical Revenue (Consolidated)(%) 3 (7) 3 2 11 (3) 9 12 14 ` 17,708 13 ` 1,823 ` 17,708 Crore 47 Crore Crore 85 39 72 Inorganic chemicals Other agri inputs Inorganic chemicals Other agri inputs Asia America Fertilisers Others Fertilisers Others Europe Africa Unallocated (0.01) Unallocated Others ANNUAL REPORT 2015-16 3 KEY FINANCIAL HIGHLIGHTS Net Revenue (` in Crore) EBITDA* and PBT* (% of Sales) PAT (` in Crore) 17 15 13 12 13 13 12 10 10 10 10 11 587 838 643 400 436 638 596 595 780 10 9 8 6 7 7 7 (1,032) -3 7,996 13,815 8,382 14,711 8,679 15,885 10,084 17,204 10,650 17,708 2011-12 2012-13 2013-142014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 Standalone PBT (Standalone) PBT (Consolidated) Standalone Consolidated EBITDA (Standalone) EBITDA (Consolidated) Consolidated *before exceptional items Earnings per Share and / Cash from Operations (` in Crore) Net Debt EBITDA Dividend per Share (`) 12.5 10 10 10 10 25.04 32.88 25.25 17.12 23.41 23.34 30.62 23.03 15.72 579 582 1,496 1,570 2,568 610 1,635 706 2,006 (40.51) (59) 2.42 2.36 2.51 3.02 2.22 3.67 2.06 3.20 2.38 3.38 2011-12 2012-13 2013-142014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 Standalone Standalone Standalone DPS Consolidated Consolidated Consolidated Segmental Results (PBIT*) Segmental Results (PBIT*) Return on Invested Capital (%) (Standalone) (%) (Consolidated) (%) 4 84 11 1 17 15 3 3 9 17 15 12 1 2 26 10 29 21 26 17 13 29 18 19 40 76 90 77 85 57 66 64 64 68 49 9 9 10 8 9 6 9 6 8 (3) (7) (3) (6) (5) (5) (3) (3) (5) (4) (3) (1) (9) (5) (7) 2011-12 2012-13 2013-14 2014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 2011-12 2012-13 2013-142014-15 2015-16 Inorganic chemicals Other agri inputs Inorganic chemicals Other agri inputs Standalone Fertilisers Others Fertilisers Others Consolidated Unallocated Unallocated *before exceptional items *before exceptional items 4 CORPORATE OVERVIEW Market Capitalisation & Share Price Gross Revenue Breakup (Standalone) (%) Gross Revenue Breakup (Consolidated) (%) 22 21 11 7 32 12 36 444 374 15 ` 11,063 ` 347 18,186 322 Crore Crore 287 20 18 20 22 7,317 11,300 9,520 8,831 8,213 Complex Fertilisers Urea Soda Ash Complex Fertilisers 2011-12 2012-13 2013-142014-15 2015-16 Others Soda Ash Others Urea Market Capitalisation Vacuum and Iodised Salt Cement Vacuum Salt Cement Share Price Other Income Other Income Living Essentials Industry Essentials Farm Essentials Tata Salt Annual Reach CSI* score (For Chemicals India) CSI* score (For Farmers) 135 113 122 57 56 61 61 64 71 82 87 83 88 86 91 78 79 77 2013-142014-15 2015-16 2013-142014-15 2015-16 2013-142014-15 2015-16 Urban Rural CSI (Soda Ash) Brand Image *Customer Satisfaction Index No. of households in Millions (Unduplicated) TRIFR Fresh Water (Recordable injuries / Million man-hrs) Employee Engagement (India) (%) Consumption (Kilo litre / tonne) (Indian Chemical Operations) 2.88 2.54 3.06 69 73 82 0.5 0.2 0.0 2013-142014-15 2015-16 2013-14 2014-15 2015-16 2013-14 2014-15 2015-16 ANNUAL REPORT 2015-16 5 GOVERNANCE The Company continues to lay great emphasis on the highest standards of Corporate Governance. The Company believes that this is essential for achieving long-term corporate goals and to enhance stakeholders’ value. In this pursuit, the Company’s Corporate Governance philosophy is to ensure fairness, transparency and integrity of the management, in order to protect the interests of all its stakeholders. Strong leadership and effective corporate governance practices have been the Company’s hallmark and it has inherited these from the Tata culture and thos.e Left to Right: Mr. EA Kshirsagar, Mr. Nasser Munjee, Mr. Nusli N Wadia, Mr. Cyrus P Mistry, Dr. YSP Thorat, Mr. Bhaskar Bhat, Ms. Vibha Paul Rishi, Mr. R Mukundan, Dr. Nirmalya Kumar Board of Directors MR.