💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations declined by 17% to INR 134 Cr in FY25 from INR 162 Cr in FY24, primarily due to a 27% decline in tea production. However, H1FY26 saw a recovery with revenue growing 7% YoY driven by higher sales volumes.

Geographic Revenue Split

100% of revenue is derived from India, specifically from tea gardens located in Assam. The company's production is concentrated in North India, where it accounts for 0.46% of the region's total production of 1,137.15 million kg.

Profitability Margins

Net Profit Margin remained thin at 0.01% in FY25 compared to 0.02% in FY24. Profitability was severely impacted by a 27% drop in production and higher employee costs, leading to a cash loss of INR 3.60 Cr in FY25 after adjusting for a one-time gratuity write-back of INR 11.05 Cr.

EBITDA Margin

PBILDT margin moderated significantly to -3.94% in FY25 from 0.77% in FY24. However, margins rebounded sharply in H1FY26 to 26.99% (up from 24.37% in H1FY25) due to increased volumes and better cost absorption.

Capital Expenditure

The company undertook a significant acquisition of the Moheema Tea Estate in FY24 to expand its production base. Debt increased to INR 77.36 Cr in FY25 to fund operations and acquisitions, with principal repayments starting in Q4 FY25.

Credit Rating & Borrowing

Credit rating was downgraded to 'CARE BBB; Stable' in December 2025 from 'CARE BBB+; Stable' due to moderated financial performance and cash losses in FY25. Interest coverage ratio stood at 1.09x in FY25, down from 1.82x in FY24.

⚙️ Operational Drivers

Raw Materials

Green tea leaves (own leaf and bought leaf) are the primary raw materials. Own leaf production increased by 2.62 lakh kg in FY25, but overall production fell to 3.78 million kg due to quality restrictions on bought leaves.

Import Sources

Raw materials are sourced locally from the company's own nine tea gardens in Assam and from third-party 'bought leaf' suppliers within the same region.

Key Suppliers

Not specifically named, but the company relies on local small tea growers for 'bought leaf' requirements, which were restricted in FY25 due to quality standards.

Capacity Expansion

Current production capacity is approximately 5.19 million kg (FY24 level). The company recently expanded its footprint by acquiring the Moheema Tea Estate in Golaghat, Assam, to increase its scale of operations.

Raw Material Costs

Labour costs are the most significant operational expense, accounting for 60% of the total cost of sales in FY25, up from 47% in FY24. This high fixed-cost structure makes margins highly sensitive to production volumes.

Manufacturing Efficiency

Capacity utilization was reported at a moderate 58% in FY24. Efficiency is hampered by the seasonal nature of tea plucking and government-mandated closure periods.

Logistics & Distribution

Distribution is primarily handled through the tea auction system and marketplace partnerships to reach domestic and export buyers.

📈 Strategic Growth

Expected Growth Rate

7%

Growth Strategy

Growth is targeted through the integration of the newly acquired Moheema Tea Estate, focusing on high-quality CTC tea production that commands premium auction prices, and improving capacity utilization from the current 58%.

Products & Services

High-quality CTC (Crush, Tear, Curl) Tea sold primarily through auctions and direct marketplace partnerships.

Brand Portfolio

Gatoonga Tea Estate, Mokrung Tea Estate, Salkathoni Tea Estate, and Moheema Tea Estate.

New Products/Services

Innovation in tea blends and strategic repositioning to counter competition from alternative beverages like energy drinks and coffee.

Market Expansion

Expansion is focused on the North India tea market, leveraging the acquisition of gardens in the Golaghat region of Assam.

Market Share & Ranking

Small player with 0.46% market share of North India's tea production. Gatoonga estate is ranked No. 1 in Assam for price realization.

Strategic Alliances

The company maintains strategic equity investments in group companies totaling INR 15.71 Cr as of March 2025.

🌍 External Factors

Industry Trends

The tea industry is seeing a shift toward alternative beverages (coffee, energy drinks) among younger demographics, growing at a rate that necessitates brand repositioning. The industry is also facing rising costs due to stricter environmental and labor standards.

Competitive Landscape

Competes with a large number of organized and unorganized tea producers in North India; market is highly fragmented with B&A holding less than 1% share.

Competitive Moat

The company's moat is built on 'Superior Quality' and brand reputation of its specific estates (Gatoonga, Mokrung). This allows them to command a premium over industry averages, which is sustainable as long as garden management and soil health are maintained.

Macro Economic Sensitivity

Highly sensitive to macroeconomic conditions influencing market demand and supply, as well as changes in regulatory and taxation policies.

Consumer Behavior

Shift in preference toward health-based alternatives and energy drinks is challenging traditional tea consumption patterns.

Geopolitical Risks

Subdued export demand for Indian tea impacts auction prices and overall revenue stability.

⚖️ Regulatory & Governance

Industry Regulations

Regulated by the Tea Board of India, Food Safety and Standards Act (FSSAI) 2006, and Legal Metrology Act 2009. Mandated garden closure dates significantly impact annual production volumes.

Environmental Compliance

Complies with Pollution Control Act and Tea Board guidelines; compliance adds to operational costs but is essential for maintaining 'superior quality' status.

Taxation Policy Impact

Subject to Indian corporate tax laws and specific agricultural tax norms applicable to tea cultivation in Assam.

Legal Contingencies

The company reported compliance with all fiscal, labour, and environmental laws. No specific high-value pending court cases or litigation values were disclosed in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

Agro-climatic risk (weather volatility) and labour wage revisions are the primary uncertainties, with the potential to swing operating margins by over 10% annually.

Geographic Concentration Risk

100% of tea gardens are concentrated in Assam, exposing the company to regional weather patterns and local political/labour issues.

Third Party Dependencies

Moderate dependency on 'bought leaf' suppliers to supplement own production; quality issues in third-party leaves led to production declines in FY25.

Technology Obsolescence Risk

Low risk in traditional tea cultivation, but digital transformation is required in distribution and marketplace partnerships.

Credit & Counterparty Risk

Exposure to group companies through loans and advances stood at INR 15.71 Cr (18.53% of net worth), which constrains financial flexibility.