INTRODUCTION

Tea is a natural beverage brewed from the leaves of an evergreen plant called Camellia sinensis. While it has become common place for people to refer to any hot beverage that is brewed from naturally occurring plants or plant extracts as tea technically, those herbal hot beverages should be called teassanes, as the word tea is reserved for beverages brewed from leaves of Camellia sinensis.

HISTORY OF TEA CULTIVTION

Discovered in china, close to 5000years age, tea is the second most consumed beverage in the world after water. It is truly a global beverage and is consumed in every corner of the world. All tea cones from the camellia sinensis or camellia Assamica plant from this plant black green or oolong tea are produced .Black tea is by for the most popular tea. The largest producer and Consumer of black tea in the world is India. Widely Consumed in the Indian sub- Continent From the turn 20th century, The tea Origin may be referred to the earliest records in 2737 B C. by emperor shang Nung in China and used as a stimulant. Tea as a beverage started in 6th Century and by 17th century it Spread to china, Indonesia. Malaysia and finally landed in Europe through Dutch/Portuguese merchants. It is interesting to note that the natural home of the plant is considered to be within fan-shaped area between Nagaland, Manipur, Mizoram along Assam Myanmar, Thailand and Vietnam.
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Tea a drink consumed in households and workplaces through the worldwas first discovered purely by accident. While many myths and legends surround the discovery of tea, one story stands out most accurately. According to the tale the history of tea originates in the year 2737 B. C. during the reign of the Chinese emperor Chen Nung. The Emperor was popularly known as the Divine Healer as he was responsible for identifying the medical properties of many herbs. One day while the emperor was on a journey he stopped for a drink of water. While he boiled the water to purify it, a few leaves from a nearby tea tree fell in to the imperial pot. For many centuries how ever the only tea that was consumed was dried green tea leaves which originated in China. Black tea was yet to be discovered. Until 850AD tea was also prepared by simply boiling the tea leaves in water, not through todays process of brewing. Traditionally there were three methods through which tea was prepared.

TEA: A CUP OF GOOD HEALTH  Tea contains antioxidants polyphenol which like oral, pancreatic and prostate.  It is now regarded as a wonder drink. There are about more than 100 scientific papers which confirm that tea is excellent health drink.  The tea polyphenols helps the body to detoxify harmful excess free radicals which occurs naturally in the body.  There is good deal of evidence that the antioxidants promote healthy heart, prevent cancer and help to compact against diabetes, blood pressure, tumor, ulcers, inflammation, intestinal problems, dental and decay and so on.  It also increases apoptosis, which is known as elimination of tumor cells. The other known factor is that is suppresses unfavorable bacteria, helps in forming favorable bacteria, which helps in metabolism.  Tea contains 2.5-4.5 mg of caffeine and 40 mg per day in beneficial as stimulants.  Tea is known to reduce risk of Alzheimer s disease, Parkinson s disease and Rheumatoid Arthritis.  The nutritional value is rich composition of carotenoidstocopherols and Ascorbic acid and Flavanoids (-TF/TR).  The studies show that tea has anti-HIV properties apart from that it has old age remedy for dysentery and cholera. provide excellent source of lowering heart disease, stroke and certain types of cancer

OBJECTIVE OF THE STUDY

y To know about the Company Haileyburia Tea Estate Ltd y To identifying their major areas of tea cultivation in India y To know about different types of teas y To study about the Financial performance of Haileyburiya Tea Estate Ltd during the year 2008-2009

SCOPE OF THE STUDY

This study entitled with Haileyburiya Tea Estate Ltd This study helps to understand their Financial performance and the business operations of this organization, and also identifying the growth and trends of tea in Indian Industry.

METHODOLGY OF THE STUDY

This study mainly based on secondary data .The secondary data are collected from journal of plantation and other books published by the company

LIMITATION OF THIS STUDY

y This project is not based on current information. y Inthis project can not study about their power and fuel consumption of green tea . For the processing methodology of green leaves and in thisproject is not study about processing methodology of green leaves. y In this project can not study about their enture operation and transaction of this busiess operations.

HEALIBURA TEA ESTATE LIMITED

The tea garden of Semnivally was formed by the hardwork and great vision of Mr Frank Bissell (1975-1958 )and Marry Bissell (1984-1977 ) They reached semnivally by 1919and formed tea garden they obtained, Support From her Highness. Sethulakshmi Baiyi. Travancore. Pri9ncess of

During on that period Maharaja and the members of

Travancore palsce used peerumedu as a palace to spend their holidays which led to the construction of palaces at peerumedu Mullaperiyar water reervior and periyar ligar reserve

During the formation of Semnivalllley Estate it Consist of uke fir field. Stag, book etc. After Indian Independence and political Change there are so many things affect the organization and loses so many of its jont estate. Now thse company managed Mr. AshokmDugar and Family. The company Consisst of Three division. 1. Semnivally 2. Haileyburia 3. Chinnar 1. Haileyburia Tea garden The company has a tea garden of nearly 950 Hectares of tea cultivation. The company is located at a beautiful location in the high range. The company has nearly 700 permanent employees and nearly 200 temporary employees. The Plucked leaves from the field are processed in the two factories which located at semnivalley and Haileyburia. Normally all the plucked leaves from the Haileyburia Tea Garden are processed by semnivalley factory and bought leaves are processed in Haileyburia factory. For that factory the company buys plucked the leaves from the employees near by estimate the two factories are processing tea leaves by CTC method. Factory and the Semnivalley was modernized in 2002. Plant capacity of Semnivalley is 45000 kg/day and 15000 kg/day for Haileyburia factory.

2. Semnivalley Factory It is one of the most advanced tea factories which located in the Idukki District which was modernized by 2002. It has three CTC machines of capacity 45000 kg/day. The factory has 22 employees working in various shift which start from 12 o clock in the mid night under the supervision of assistance Factory manager and Tea maker. Processed Tea in the factory are packed at a weight of 54 kg and 30 kg bags arranged for selling through Tea Auction held at Cochin and certain amount of Tea are sell in the internal market under the brand name of Chinnar and Thejas. The products are of different grades such as

FD,GD,SRD,RD,PD,BOP and SFD CTC crush Teas &Curl The Factory has a capacity of 15000 Kg/Day. Earlier days this factory produced orthodox type tea, later it is changed to CTC types of Tea. The processing of leaves in this factory is done with help of one CTC machine, three drums for fermentation, one Dryer, two fiber extractor and has 18 employees working per shift. The tea leaves for processing in this factory are brought from outside. The lockouts of neighboring estates helped it to buy tea leaves and they sold to the Haileyburia Estates. The Haileyburia Tea factory collecting these leaves through outside agents of a commission rate. Normally leaves obtained at the rate of 7-10 Rs/Kg which determine the quality of leaves. By processing

of brought leaves company gets nearly 12Rs/Kg as profits. It can increase by providing some standard at the course percentage. But that situation brings a difficulty in getting leaves. So the company wants to keep a balance between the coarse percentage and availability of leaves.

Employees in the Organization

The cultivation is more labour intensive and require cheap works than other type of plantations. In this organization employees are catagorized in to two groups, the official staff and field workers. The hierarchical order of employees in the organization is that of Managing Director-Manager-Estate Superintendent-Supervisors-Workers.

Management Structure

Managing Director Or Board of Director

Mangers Estate Superintendents Supervisor s Workers

Board of directors
Chairman Vinod kumar Dugar Managing Director Ashok Kumar Dugar - Sudhir Prakash - K Ahemedullah

BENAFITS OF LABOURS
Labour gets their wages depending upon the task assigned to them. In addition to their wages they also earn the additional benefits of  Over Time Allowance  Plucking Allowance  Sickness Benefit  Bata for traveling on Duty  Paid Holidays  Provident funds  Kitchen garden  Protection against weather  Medical facility  Weekly Holidays  Annual leave with wages  Bonus Provident funds are issued at the rate of 8.5% Gratuity 15 days wages beed on least drawn wages rate immediately providing service . Retirement age is fixed to 60 years . retirements in respect of every completed year of

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Paid holidays under Act of 1985,number of Paid holidays prescribed as 26th junuary ,15th Agust ,1st May and four other days to be specified by the inspector of appointed under Act Leave :-The company provides various leaves for employees ,they are  Annual Leave  Casual Leave  Sick Leave  Festival Leave  Maternity Leave

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INDUSTRY PROFILE INDIAN TEAS The credit for creating India s vast tea empire goes to the British, who discovered tea in India and cultivated and consumed it in enormous quantities between the early 1800 s and India s independent from Great Britain in 1947. The Scottish adventure, Robert Bruce, discovered tea plant growing in Assam in the 1820 s at this time no one through that tea extend in India, how ever major Bruce discovered the plants growing wild in the jungles controlled by the tribal chiefs. The British East India Company s monopoly in China entered in 1832 and it become necessary to find sources to supply the English consumers of tea. In 1834 a tea committee was appointed to investigate the possibility of cultivating tea in India. After a through investigation and study of crop, the first commercial batch of tea ever produced outside of China came from Assam in 1839. The first contract of Indian Teas between 500 and 1000 chests was issued by London brokers at that time. Two of India s major teas are Darjeeling and the Assam. India s famed Darjeeling is named after the summer capital of the Government of Bengal. Where tea is cultivated at altitudes of 4000-1000feet in the Darjeeling hills. India s other major tea, Assam is named for the district in which it grown, which lies in northeast India along the boarder between India and Burma. This region produced more back , tea that any other tea in the world with the exception of some part of China. Assam
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tea which is strong dark and rich is a component of many standard blends including Irish Breakfast.

India has over 13000 tea estates with a combined acreage of about one million, most of it in northern India. The sector employs close to one and a half million people with foreign participation in the majority of tea Plantation at 25-30% until recently, no company in India was allowed to be majority owned by Oversea stockholders.

Despite India s historical success with the tea industry. In recent years, Indian teas have faced serious competition in the international market. The UK now imports tea cheaper from Kenya and Malawi. To combat some of these challenges advertisers have made effort towards building marketing campaign in order to boost the tea market. Some effort have even being made to promote tea like Cocacola. Yes despite these effort tea producers in India Continue to face serious challenges. How to keep Quality , production and export up without driving prices down.

Tea is a highly adaptable plant, a result of which is that tea is grown around the world. How ever, among the tea producing nation of the world India stands ; head and shoulders above any other. The total volume of tea produced in world wide in recent years has surpassed 3

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billion Kgs with India producing over 826 million Kgs Indian tea, thus over a quarter of the world market with a market share of about 28% isn t strange then that we don t get to here much about the fine Indian teas?

Most people have heard of a few big name gardens from Darjeeling and other few from Assam, but there are many small Indian gardens that are family owned and produced outstanding teas but are completely unheard of outside of India.

The main reason for this is the fact that India s domestic market, with its huge appetitive for tea. Consumes much of the high Quality Indian tea, to satisfy the domestic demand, the Indian producers produce large quantities of CTC teas, the kinds that are popular of Indian market. Only about 11-13% of the tea produced are of the Orthodox verity, the kind of tea westerners like to drink. It is there for easy to understand why much of finest Indian tea never make it out of India. Still, in 1998, India exported about 210 million Kgs of tea, making it the second largest tea exporter in the world. Recently, due to heavy demand from the export customers, Indian tea industry has started producing organic tea.

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There are four main tea producing regions in India, the Darjeeling & Terai region. The Assam region. The Himachal Pradesh region all of which are in North India and the Nilgiri tea producing region which is in the Southern part of India. A whopping 1-1 million acres of land is under tea cultivation, employing about 1 million People, The Northern Indian tea estate produce about 75-80% of the tea produced in India. While the southern States account for 20-25% of the tea Although the southern estates produce smaller quantities of the total production. They account for more than half of the total Indian tea export in volume. Tea producing region in India.

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TYPES OF TEA
Once the tea leaf is plucked, it is processed in the factory to bring out the flavors in it. There are essentially two types of teas: Orthodox and CTC. The Orthodox tea is the whole leaf tea is generally popular in the west, but in India ,CTC tea is wildly popular for the type of tea they make there, called Chai, involving boiling the tea over and over to extract the most out of it. The teas sold by Jaya are predominantly Orthodox teas, but we are planning to carry some outstanding varieties of fermentation, the processed tea is called White (steamed), Green (least fermented), Oolong (semi-fermented) and Black(fully fermented). White tea Recently popular, white tea is produced when two leaves and a bud are picked just before sunrise to preserve the moisture in the leaf. White teas are from two varieties of the Chinese tea bush-the Shui Hsien and the Dai Bai. This tea is characterized by a delicate flavor with very little color, however it is highly priced because a days picking produces only about 1 2 Kgs. Although it is called white tea, the tea does have some

light green color characteristic of the newest buds originating on the bush. The buds are steamed to destroy the enzymes that would otherwise destroy the tea and dried either in the dryer or in the sun.

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Green tea Green tea is produced by steaming the leaves to destroy the enzymes that might otherwise ferment the leaves. The leaves are then rolled either by hand or by mechanical rollers, to bring out the huices in the leaves that are responsible for its flavor. The rolled leaves are then fired to dry them. The entire process of rolling and firing is repeated several times until the leaves are completely dry. The process of producing green tea is very exacting because variation in the drying time can result in fermentation of the leaves which spoils its flavor. Green tea is mainly produced in Japan and China, although increasingly; the Indian estates are producing high quality green tea to supply to the increasing connoisseur demand in Japan and other markets.

Oolong Teas Oolong teas are semi fermented teas that are partially fermented before drying to preserve the natural flavours. Legend has it that a tea farmer, while producing the tea, was scared away by a black snake. When he returned he found that the tea had been fermented to a red color and produced a most delightful flavor. Oolong teas were first produced about 400 years ago in the Fujian Province at the end of the Ming Dynasty. Since then, Oolongs have been produced in many other parts of China and other parts of the world. Today, the most popular Oolongs are

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produced in the island of Taiwan or Formosa, however, more recently, delightful Oolongs produced in the Indian estates of Darjeeling region are gaining rapid market acceptance due to their delicate character. The process of producing Oolongs begins with picking of the two leaves and a bud, generally early in the morning. The leaves are then partially dried indoors to promote fermentation. When the leaves start turning red-at a stage when 30%of the leaves are read, and the rest 70% are green the leaves are rubbed repeatedly by hand or mechanically to generate flavor and aroma, and finally dried over charcoal. The final stage in production of Oolong teas is blending the teas to produce the characteristic flavor of the garden or the brand. Black Tea Arguably, the most widely consumed beverage, black tea is close cousins to the Oolong in that if the tea is fermented long enough, the leaves turn black, hence the term black tea . Although Black teas could be

produced in China, Chinese producers have focused entirely on production of Oolongs to satisfy the great demand from the local market. On the other hand, the Indian, Russian, and Middle Eastern markets demand black teas, in response to this demand the Indian, Sri Lankan and African producers have focused mostly on producing black tea.

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TEA AS AN INDUSTRY
The production and export figures are given below.

Country

Production

Export

% export

India China Sri Lanka Kenya World

854 695 295 295 3090

183 250 289 258 1389

21 36 98 87 45

Until 1997-1998 tea occupied a significant position in export with 20-7%. Due to global siff competition, the share of tea export started declining and slipped to 3rd position with a share of 8.8% similarly its contribution to UDP has defined from 1.24% in 1981 to 33% in 2009 it is a matter of concern for all involved in the industry.

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THE GROWTH TREND FOR INDIAN INDUSTRY

Year 1970 1980 1990 2000 2008 Area(100ha) 316 354 416 507 512 Production(1000Kg) 278 419 720 846 859 Yield Kg/ha 881 1182 1731 1669 1690

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1970 1980 1990 2000 2008 Yield Kg/ha Production Area

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TEA CONSUMPTION IN INDIA Year 1950 1960 1970 1980 1990 2000 2008 Production 45 39 38 32 28 28 28 Consumption 12 16 21 19 22 22 22 Export 50 36 31 26 15 15 13

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1950 1960 1970 1980 1990 2000 2008 Export Consumption Production

The above table indicates stagnant Consumption and drop in export.

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THE TEA CONSUMPTION

Country India China Sri Lanka Kenya Japan Ireland UK 0.65 0.35 1.14 0.45 1.00 3.00 2.5 Per Capita Consumption(Kg/ha)

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EXPORT PROFILE OF INDIAN TEA

Year 1991 1998 1999 2000 2005 Qty Kg 202.92 210.34 191.72 206.82 185.59 Values(Rs) 1134.55 2309.44 1965.87 1898.61 1682.11 Unit Price(Rs) 55.91 109.80 102.54 91.80 92.13

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1991 1998 1999 2000 2005 Unit Price(Rs) Values(Rs) Qty Kg

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Organic Tea There is a growing awareness of tea as health drink apart from that organic tea is emerging as a special value added product over the past decade, organic tea consumption health grown by more than 10% per year globally. Based on this growing demand price for organic tea have been generally % times higher than price of non-organic tea. Economic of Organic Vs high external input tea cultivation The following table gives the comparative statement against organic tea. Price of organic Tea: In early 90s the price difference with organic tea and non-organic tea and non Organic tea went up to 200-300% but now has stabilize around 50100% Price realization: Non-organic (Rs) organic (+/- increase in P C) 1990 Darjeeling Tea 90/-270-(+)200% Assam 45/-200/-(+)3445 South India 35/2000 Darjeeling Tea 150/-300/-(+)100% Assam 95/-150/-(+)58% South India 65/-120/-(+)85%

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Role of Tea Industry in Indian Economy 1. Largest producer and biggest consumer 2. India produces about 928m.kg(world production 3376m.kg)in 2005 3. India account for 27% of global production and 12% of shipment 4. Out of total production 79% consumed and 21% exported 5. Earn a foreign exchange over Rs 1738 covers/annum 6. Generate income to central and state Govt. through taxes 7. Most labor intensive crop (opportunity for about 20 lacks of people) 8. Move employment to women and listed classes 9. Helps in rural development, conserves soil, maintain ecological equilibrium.

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Sale of Tea in India

Producers Production

Brokers Auction

 Calcutta  Guwahati  Siliguri

 Coimbatoor  Cochin  Coonoor  Amritsar

Bulk Packet Domestic Trades Merchant Exports

Bulk Packet

Whole sale/ Retailers

Importers

Indian Consumers

Overseas Consumers

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RATIO ANALYSIS
The term ratio analysis is a process of comparison of one digit to another. Ratio analysis is an important tool for interpreting accounting data. It is a tool used by individuals to conduct a quantitative analysis of information in a companys financial statements. Ratios are calculated from current year numbers and are then compared to previous years, other companies, the industry, or even the economy to judge the performance of the company. Ratio analysis is one of the best possible techniques available to the management to indicate the basic function like planning and control. Ratios calculated on the basis of past financial statement may be of good help to predict the future. It is also useful to control efficiency and improve profitability of a business entity. It helps to make easy and express numerical data in a systematic manner. It also works in identifying business strengths and weaknesses.

MEANING AND DEFINITION OF RATIO ANALYSIS

Ratio simply refer to the relationship between two numbers. It shows a numerical or quantitative relationship between numbers and group of numbers. Ratios show how one number is related to another. This relation can be expressed as a percentage, fraction, rate, decimal, or in proportion. Accounting ratios are the relationship expressed in mathematical terms between two financial data which are connected to each other.
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According to Kohler a ratio is the relation of one amount, a to another b, expressed as a ratio of a to b, a:b(a is to b)or as a simple fraction, integer, decimal, or percentage. According ratio is calculated by dividing one number with another related number. Ratio is a yardstick used to evaluated the financial condition and performance of a firm, relating to two pieces of financial data to each other (James c Van Horne) Ratio analysis refers to calculation of the relationship, its interpretation and arriving at conclusions. Ratio analysis of financial statements refers to the process determining and presenting the relationship of items and groups of items in the statement. It is defined as the systematic use of a ratio to interpret the financial statements so that the strengths and weakness of a firm as well as its historical performance and current financial condition can be determined. The definitions and descriptions clearly tell that ratio is a relationship

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FINANCIAL PERFORMANCE IN 2008-2009

Particulars Turnover Loss profit/Loss before interest, Depreciation and Tax Interest Depreciation Profit/Loss before tax & other income Add other income Profit/Loss before tax Income tax Net profit/Loss after tax 1248.46 114.52 62.95 78.69 29.12 6.71 10.64 17.35 .45 16.90 32.99 (27.12) 19.68 (7.43) .40 7.83 2008-2009 2007-2008 860.89 68.82

Operations The total sale turnover of the company during the year and review was 1248.46 lakhs against Rs 360.89 lakhs last year. The average selling price of Chinnar make was Rs 85.69 against Rs 64.09 Per Kg and for Haileburia make Rs 66.09 againist 52.39 per Kg at last year to the improvement of tea price. The company has produced 10,37,125Kgs from bought leaf operation. The minimum wages in Kerala for tea plantation workers were revised to Rs 115.00 with effect from 16th July 2008 and considering the impact of
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variable DA it is currently fixed at 124.09 per day representing an increase of 30-50% and the above figures along with the increase in staff cost as per UPASI agreement has resulted in to considerable increase in the cost of production which is a matter of concern. The company had to provide a higher provision actually of Rs 127.7 lakhs against Rs 10.75 lakhs for the previous years which has affected the profitability. The current year 2009-10 is experiencing delayed monsoon and lower rainfall which has affected the production. During the 1st three months ie, April-June 09 the company has produced 3.06096 Kgs of made tea from own crop against 290312 Kgs and 169157 Kgs from the bought leaf against 221239 during the same period last year. The average sale price realized during the period for Chinnar make was Rs 101.22 Kg against Rs 67.42 and for Haileyburia make was Rs 83.59 against 56.64 last year. The tea production has been adversely affected in the major producing contries of Kenya & Sri Lanka Due to rough condition which has resulted into reduced inventories and firming up of the market and trend is likely to continue for the rest of the year.

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BALANCE SHEET AS ON 31-03-2009

Particulars I. Sources of Funds 1. Shareholders fund a) Capital b)Reserve & Surplus 2. Loan Funds a) Secured Loans b)Unsecured Loan Total II. Application of funds 1. Fixed Assets a) Cross block b)Depreciation c) Net Block 75186222.29 170160048.15 2. Investments 9626.80 9619.00 71867460.29 173246018.35 245346270.44 245113478.64 24712916.40 12233363.59 175475804.30 36049151.45 6611414.59 181596492.35 15750,000 122779524.31 15750000 123185926.31 31-03-2009 As at 31-03-2008

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3. Current Asset.Loan & advances a) Inventaries b)Sundry Das c) Cash and Bank balances d)Current Assets(alber) e) Loan and advances 8270353.43 1017055.51 447278.02 144420 6392423.68 11686123.34 11840959.25 201904.77 265335.00 5852436.84

16271530.64 Less: Current Liabilities And Provision a) Liabilities b) Provision 58955955.13 30000 58985955.13 Net Current Assets 4. Profit & Loss Account Total (42714424.49) 48020553.84 175475804.30

19846759.20

6119422560 22707.00 61216932.60 (41370173.40) 49711028.40 181596492.35

Ratio Analysis of financial Statement of Haileyburia Tea Estate Ltd

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AS ON 31- MARCH 2009

 Current Ratio:Current Ratio is the most common ratio for measuring liquidity. It represent the ratio of current asset to current liability. Current Ration = Current Asset Current liablility = 16271530.64 58955955.13 = .27:1 The ideal ratio should be 2:1 or there should be 2 worth current Asset to meet Rs 1 current liability. But in this company can only .27:1. So the current Asset is less than current liability. Hence the financial position of the company is not ideal one.  Quick Ratio Quick ratio is also called Acid Test Ration or Liquidity ratio. It is the relationship between quick asset to current liabilities. Quick Ratio = Quick Asset Current Liabilities

Quick Asset = 16271530.64-8270353.43 = 8001177.21 = 8001177.21 58955955.13

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= .135:1 The ideal Quick Ratio should be 1:1 or Quick asset should be equal to current liability. But in this company, the quick ratio as .135:1. So the current Asset is less than current liability. Hence the financial position of this firm is not satisfactory.

 Debt-Equity Ratio This ratio indicate the relationship between borrowed fund and owners capital is a popular measure of long term financial solvency of the firm. Debt-Equity Ratio = = = Debt Equity 95932235.12 138529524.31 .69:1

The ideal ratio should be 2:1 but in this firm, the Debt-Equity ratio is .69:1. Hence the long term financial solvency is favorable for the firm because the low ratio shows that the claim of creditors are less than those of owners.

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 Proprietary Ratio The ratio relate to the share holders fund to total Asset. This ratio shows the long term solvency of the firm. Proprietary Ratio = Shareholders funds Total Assets 138529524.31 175475804.30 .78:1

The acceptable norm of this ratio is 1:2 this ratio shows the financial strength of the firm. In this firm earn .78:1. So this firm face the greater risk to creditors.  Solvancy Ratio or Total liabilities to Total Asset Ratio = = = Total liabilities to outsiders Total Assets 95932235.12 175475804.30 .54:1

The long term solvency of the firm is satisfactory.

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AS ON 31- MARCH 2008

 Current Ratio:Current Ration = Current Asset Current liablility = 19846759.20 61194225.60 = .32:1 The ideal ratio should be 2:1. But in this company can only .32:1. Hence the financial position of the company is not good.  Quick Ratio Quick Ratio = Quick Asset Current Liabilities

Quick Asset = 19846759.20-11686123.34 = 8160635.86 = 8160635.86 61194225.60 = .133:1 The ideal Quick Ratio should be 1:1. In this company earn, the quick ratio is .133:1. So the Quick Asset is lower than current liability. So this firm have no ideal financial position.

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 Debt-Equity Ratio Debt-Equity Ratio = = = Debt Equity 103877498.64 138935926.31 .74:1

The ideal ratio should be 2:1 but in this year, the Debt-Equity ratio is .74:1. Hence the long term financial solvency of the firm is  Proprietary Ratio Proprietary Ratio = Shareholders funds Total Assets 138935926.31 181596492.35 .76:1

The acceptable norm of the propretory ratio is 1:2 but in this year firm earn .78:1. So this firm face the greater risk to creditors.  Solvancy Ratio or Total liabilities to Total Asset Ratio = = = Total liabilities to outsiders Total Assets 95932235.12 175475804.30 .54:1

The long term solvency of the firm is satisfactory.

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Findings And Recommendation

Problem faced by the Organisation  Present situation of the tea cultivation in India. India has destination of producing both the highest and lowest quality teas. The famed Darjeeling as well as generic etc(cut-teascurl) a nondescript blend used in teas. The best of India s prize Darjeeling is considered the world finest tea and almost all of it is exported. However, India, the worlds largest tea producer is facing a rising competition in the world tea market. Sri Lanka, another major tea producer and strong competitor of the Indian tea market faces similar problems. Tea in these is currently on downward trend with reduced demand followed by an over abundance of tea. Tea prices have been salleny worldwide because of an over supply in production while world market prices in real terms have declined, the cost of production has increased steadily. cutting producers costs. Moreover big buyers like Russia, Iran and Iraq have become inactive due to political reasons. Changing consumption patterns have also contributed to the decline in tea prices. Despite, Sri Lanka concerns over the tea market, the country has also gained momentum over India in the tea market Sri Lanka sold 27 million Kgs of tea to the commonwealth of independent sales to Russian buyers where recent sales of Indian teas have been poor moreover, Sri Lankans sold their teas to Russians at a low price of 1.5 US

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dollars a Kilogram during the last three quarters of 1993 while the price of most north Indian teas was over 2 US dollars per Kilogram. Rising competition from African Countries as Kenya, also threatens India where production in teas in new and expanding. Developing countries in South Asia and East Africa account for more than 85% of world tea production and exports. India and Sri Lanka are dominant in both Developed countries account for about 62% of world tea imports. The larger importees include the UK, US, Netherland, Australia, Canada, Japan, South Africa, Ireland and the former Soviet Union. Since 1970 India has become the largest absolute consumer of tea. In 1971-73 it accounted for 22 percent of total world consumption. Compared with the United Kingdom s 18% for the United Kingdom both absolute and per capita consumption has been declining over the past two decades reflection the diversification of tastes. In favor of coffee (Particularly instant coffee) and soft drinks, by contrast, the US consumption shows a continuous rising trend reflecting the increased popularity of iced tea. Shift in the composition of demand for tea in the developed importing countries have had unfavorable effect on aggregate export earning from tea. The increasing use of tea bags and soluble instant tea effectively reduces the qty of tea needed per cup and also rises the demand for plain cheaper tea at the expense of those of high quality.

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Tea bags account for about 10 percent of the volume of world consumption. Factors that seem to have simulated consumption of instant tea include its ease of use as a cold drink and the growing prevalence of vending machines. It is these changes in the consumption patterns of tea which contribute to the decline in tea prices. Although many industrialized countries are drinking less tea developing nation increasingly demand the beverage yet do not have the hard to pay for it. The international market price of tea is determined at major auctions in centers such as Calcutta, Colombo, and London. The UK has historically held about 50 percent of world tea stocks. The remainder being held by producing countries-Since Britain largest tea importer. London provides the leading price indicator in the world market. Also affecting tea prices has been the collapse of Soviet Union a major market for Indian exports. Because the former Soviet bloc countries have mostly withdrawn from the tea market due to hard currency shortage tea prices have been forced downwards. In 1991, the average price of tea in London fell from 1990s 114 pence/kg to 105pence. Further more, the price premium that Indian and Sri Lankan teas commanded in the early 1950s has gradually been eroded through the quality of improved African teas.

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The annual report of the UPASI records: in the light of the frequent breakdowns at the e-auctions and the problems faced by the producers on account of withdrawal of last thereby affecting the cash flow position UPASI had requested the Tea-Board to put in place a fool proof system so that there are no disruption and breakdown at the auctions . Pressure has been mounted on the centre to declare a workable floor price to save the 60000 small growers in the Nilgiris who have been demanding various levels of floor prices from Rs.10 to 15 a kilo for the green leaf they supply the players in the industry expect this forum to an announce two important decision- a floor price for the green leaf and the suspension of the e-auctions until they are presented troublefreely to the factories.  Delay in planning and its execution  Vary low price of tea  Lacks of faxibility in changing cultivational operations according to the changes in climate  Lack of skilled official staff  Delay in the use of pesticides and manure due to y Lack of supply y Capital problem y Insufficient labour

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y Climate conditions  Social problems like strikes harthals.etc  Lack of field experience among top officials may impair the timely decision making.  Total Mis-management when sub-ordinate are not obeying the respective managers.  Don t have any attempt to understand the changing environmental conditions.  The company availed to only about 60% service of consulting agencies like UPASI tea board. And not having any self research in their own firm.  Psychological factor of labour class-workers mental co-operation and responsibility changes mainly due to the social political, rural and other complexes which poured from the growth of urbanization. Mass media etc. Kerala s political situation and feeling of lack of many. In fact labour is a hidden factor in a worker which will be boosted to attain maximum production and efficiency.  Disobedience and poor respect to management this is due to. y Insufficient labour and feeling of poor wages. y Company s liability to the working class y Trade union.

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y Psychological

and social compartmentalization of labour

group with in a small group which will deeply attribute to labours seniority and in capable mgt. The field staff are still in the hangover of a European rule and style which will posses unsatisfactory results. Promotion and appointments shall be strictly according to the ability and responsibility. y Labour lack of morality mental attribute while handling third person s wealth and money. y Cold war among field staff in the case of who is superior and who is inferior. The success of many firm is limited to the hands of the staff and all the superiors will success only with the co-operation of their subordinate. Real Remedy Rest upon the motivation and awareness counseling of the mgt.

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