Credit Rating by Care Ratings Limited

@ Dhunseri Teo & lndustries Llmlted Dhunseri CIN : Ll 5500WBl 997P1C085661 Reglstered Offlce : Dhunseil House, 4A" Woo<lburn PorK Kolkoto 7OOO2O November 5,2026 BSE Limited National Stock Exchange of India Ltd., Phiroze-Jeej eebhoy Towers, Exchange Plaza,C-l, Block G, 5th Floor Dalal Street, Bandra Kurla Complex, Mumbai-400 001 Bandra (E), Scrin Code: 538902 Mumbai -400 051 Svmbol: DTIL Sub: Credit Ratine for Bank Facilities Dear Sir, This is to inform you that the CARE Ratings Limited has reviewed, reaffirmed and assigned the following ratings of the Company as detailed below: Facilities Amount Rating Rating Action (Rs. crore) Long term Bank 146.76 CARE A-; Stable Downgraded from CARE Facilities (reduced from 148.93) A; Stable Short term Bank 0.50 CARE A2 Downgraded from CARE Facilities A2+ TOTAL 147,26 The Press Release is enclosed. Thanking You, Youls faithfully, For Dhunseri Tea & Industries timited Urrt Bhotil<" Urmi Bhotika Company Secretary & Kolkata Compliance Officer 700 020 Encl: as above Ph. : +91 3322801950 (Five Lines) Fax : +91 33 2287 835019274 Email : mail@dhunseritea.com, Website www.dhunseritea.com Press Release Dhunseri Tea & Industries Limited November 04,2026 Name of the Facilities Amount (₹ crore) Ratings2 Rating Action Regulator1 146.76 CARE A-; Downgraded from CARE A; Long-term bank facilities RBI (Reduced from 148.93) Stable Stable Short-term bank facilities RBI 0.50 CARE A2 Downgraded from CARE A2+ Details of facilities in Annexure-1. Rationale and key rating drivers Revision in ratings assigned to bank facilities of Dhunseri Tea & Industries Limited (DTIL) factors its weaker-than-expected performance in FY25 and FY26 (FY refers to April to March), characterised by operating losses though reduced y-o-y. The sustained weak financial performance continues to exert pressure on its debt coverage indicators. the company has high debt repayments of ~₹35 crore each in FY27-FY28. Debt repayment of FY27 is expected to be met partly out of cash accruals and balance from proceeds from gardens sold in FY26. The company has generated cashflow through sale of its loss-making tea gardens to support its liquidity needs. However, ratings continue to benefit from extensive experience of its promoters and the company’s established track record in the tea industry. Ratings also derive significant comfort from the group’s liquidity, which includes cash and liquid investments in mutual funds and listed securities. The promoter group has demonstrated support by infusing unsecured loans on a need basis, which is likely to continue in future as well. Ratings are further constrained by DTIL’s moderate scale of operations, labour-intensive nature of the tea industry with increasing wage cost, and susceptibility of tea and macadamia businesses to agro-climatic risks. Ratings also consider volatility in macadamia prices. Rating sensitivities: Factors likely to lead to rating actions Positive factors • Substantial Improvement in scale of operations with benefit from acquired tea gardens. • Improvement in profit before interest, lease rentals, depreciation and taxation (PBILDT) margin beyond 10% on a sustained basis. Negative factors • Increase in debt leading to overall gearing above 1x on a sustained basis. • Delay in receipt of need-based support from the promoter group. • Lower than envisaged cash profits, resulting in moderation in debt servicing coverage and creating pressure on repayment obligations on a sustained basis. Analytical approach: Consolidated, along with factoring strong financial flexibility by virtue of being part of Dhunseri group. The subsidiaries are in similar line of business with common management and financial support extended by DTIL in the form of Standby Letter of Credit to one of its subsidiaries. Entities getting consolidated are listed under Annexure-5. The ratings also consider substantial liquidity available at group level providing financial flexibility. Outlook: Stable The stable outlook reflects strong financial flexibility available to the company being part of the Dhunseri group and demonstrated successful track record of managing their tea business, which is expected to continue going forward. Detailed description of key rating drivers Key strengths 1SEBI: Securities and Exchange Board of India; RBI: Reserve Bank of India; MCA: Ministry of Corporate Affairs; IRDAI: Insurance Regulatory and Development Authority of India; PFRDA: Pension Fund Regulatory and Development Authority. 2Complete definitions of ratings assigned are available at www.careratings.com and in other CARE Ratings Limited’s publications. 1 CARE Ratings Ltd. Press Release Experience of promoters and established track record of company in tea industry DTIL is a part of the Dhunseri group, which has been carrying on the tea business for over five decades. Despite the tea industry passing through several bad phases in the last few decades, promoters have demonstrated a successful track record of managing their tea business. C. K. Dhanuka, Chairman and MD of the company, is one of the reputed industrialists of Kolkata with long experience in the tea industry. The promoter group is ably supported by an experienced management team. The rating derives significant comfort from available liquidity at the group level (in Dhunseri Investment Limited Consolidated books) aggregating ~₹930 crore as on March 31, 2026, in the form of cash and liquid investments in mutual funds and listed securities. DTIL currently has 9 tea estates and 9 tea factories, producing quality tea. The company sells tea via auctions, private sales through intermediaries and packaged tea. Satisfactory operational parameters with satisfactory recovery rate DTIL has been carrying out operations across its tea gardens (9) in Assam as on March 31, 2026, where the quality of black tea is superior compared to the rest of India. The domestic average tea yield increased to ~1,881 kg per hectare in FY26 compared to 1640 kg per hectare in FY25 largely considering continuous estate upgradation. Tea production increased from 11.73 million kg in FY25 to 12.20 million kg in FY26 with better estate management and agronomic practices. Tea production reduced in Q1FY27 against Q1FY26 considering lower number of gardens. Average recovery rate (ranging from 22.99% to 23.83% from FY23-FY26 and Q1FY27) for the company has been in line with the industry average of ~22%. Production in its overseas subsidiary decreased with tea production at 7.98 million kg in CY25 against 9.16 million kg in CY24. However, the production of macadamia nuts increased from 0.47 million kg in CY24 to 0.60 million kg in CY25. The tea production in Q1FY27 stood at 2.46 million kg (against 3.14 million kg in Q1FY26) with macadamia nuts at 0.26 million kg (against 0.33 million kg in Q1FY26). Key weaknesses Weaker-than-expected performance leading to weak coverage indicators DTIL’s financial performance remained weaker-than-expected in FY25 and FY26, characterised by operating losses though reduced y-o-y. The sustained weak financial performance continues to exert pressure on its debt coverage indicators. DTIL achieved an increase in its consolidated TOI by 5% y-o-y from ₹456.38 crore in FY25 to ₹477.61 crore in FY26. On a standalone level, while sales volume moderated by ~2% owing to lower production amidst lower gardens, the realisation increased by over 2% considering steady demand. Despite higher revenue, operational losses persisted due to lower sales volumes. Performance of Malawi subsidiaries improved in FY26 supported by higher realisation of macadamia. Though losses narrowed on a year-on-year basis, supported by cost optimisation initiatives and divestment of loss-making tea gardens, subdued profitability continues to weaken the debt protection metrics. In Q1FY27 company’s revenue and operating profit moderated y-o-y due to lower number of gardens post sale of Balijan and Deohall tea estate in FY26 and lower sales volume in M [Showing first 8,000 characters — download PDF for full document]