11 August 2015
1QFY16 Results Update | Sector: Agri
Jain Irrigation
BSE SENSEX
27,866
Bloomberg
Equity Shares (m)
M.Cap. (INR b) / (USD b)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val,INRm/Vol ‘000
Free float (%)
Financials & Valuation (INR b)
Y/E MAR
Sales
EBITDA
NP
EPS (INR)
EPS Gr .(%)
BV/Sh (INR)
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2015 2016E 2017E
61.6
7.9
0.9
1.9
28.8
51.1
3.8
9.0
37.7
1.4
66.7
9.0
1.8
3.9
108.6
53.8
7.4
10.5
18.1
1.3
76.2
10.3
3.2
7.0
80.4
60.2
12.3
12.8
10.0
1.2
n
n
S&P CNX
8,462
JI IN
462.4
32.4/0.5
100/55
-4/6/-38
312/4,228
71.3
n
CMP: INR70
n
TP: INR84 (+20%)
Buy
Results below estimates; food processing stake sale set to unlock value
Results below estimates, led by subdued food processing and MIS growth:
JI
reported overall revenue of INR15.8b (est. of INR17.1b) as against INR15.5b in
1QFY15, marking a 2.2% YoY growth. The growth was led by piping business
(21.9% YoY); MIS business grew 5.1% and food processing de-grew 3.1%.
Domestic MIS business grew 9.6% during the quarter; however, overall MIS
business grew by only 5.1% on account of a 38% decline in MIS exports.
Margins expand on the back of lower polymer prices:
EBITDA stood at INR2.2b
(est. of INR2.2b) in 1QFY16, with EBITDA margins at 13.7% (est. of 12.9%), an
expansion of 80bp—primarily led by gross margin expansion of 160bp YoY.
Polymer prices, which are inputs for piping and MIS businesses, declined ~5%
QoQ—driving gross margin higher. During the quarter, forex loss stood at
INR247m due to a 2% depreciation in USD:INR. Consequently, adj. PAT for the
quarter stood at INR390m (est. of INR418m) as against INR203m in 1QFY15.
Stake sale in food processing set to unlock vale:
The management highlighted
that the process for subsidiarization and 25% stake sale of food processing
business is on track, with transaction finalization likely by October 2015. We
believe 25% stake sale in food processing will unlock value for Jain Irrigation and
will set a valuation benchmark for the food processing business, along with paring
debt at the parent level; this is expected to be a near-term trigger for the stock.
Valuation and view:
The management is confident of double-digit revenue
growth in FY16, lead by 15% growth in MIS, 20% in food processing and 20% in
Piping; however, the first-half is expected to be muted (with growth likely to be
back-ended). Additionally, the management is confident of INR3b of debt
retirement in FY16. We cut our EBITDA estimates by 3%/7% for FY16/FY17. Due
to high financial leverage, our EPS estimates for FY16 and FY17 are lower by 13%
and 16%, respectively. Maintain
Buy
with a TP of INR84 (12x FY17E EPS).
Estimate change
TP change
Rating change
-16%
-16%
Atul Mehra
(Atul.Mehra@MotilalOswal.com); +91 22 3982 5417
Niket Shah
(Niket.Shah@MotilalOswal.com); +91 22 3982 5426
Investors are advised to refer through disclosures made at the end of the Research Report.
Motilal Oswal research is available on
www.motilaloswal.com/Institutional-Equities,
Bloomberg, Thomson Reuters, Factset and S&P Capital.

Jain Irrigation
Results below estimates, led by subdued food processing and MIS growth
n
n
n
n
n
n
n
n
n
n
JI reported overall revenue of INR15.8b (est INR17.1b) as against INR15.5b in
1QFY15 marking a YoY growth of 2.2%.
Pipe business showed a robust growth of 21.9% YoY where the growth was
largely led by PE pipe division which grew 100% YoY on account of large orders
from telecom players.
Domestic MIS business grew 9.6% during the quarter, however overall MIS
business grew only by 5.1% on account of 38% decline in MIS exports.
Revenues from overseas operations de-grew 8.3% due to seasonal factors,
currency fluctuations resulting in lower reported revenues and commodity
turmoil in countries like Israel, Peru, Mexico and Brazil.
Food processing revenues de-grew -3.5% YoY on a consolidated basis.
EBITDA stood at INR2.2b (est INR2.2b) in 1QFY16 with EBITDA margins at 13.7%
(est 12.9%), expanding 80bp YoY led by gross margin expansion of 160bp .
Management explained that the gross margin expansion can be attributed to
the decline in prices of polymer and crude oil.
Other income rose to INR102m from INR23m in 1QFY15, driving PAT higher.
Consequently, Adj PAT for the quarter stood at INR390m (est INR418m) as
against INR203m in 1QFY15, marking a YoY growth of 92%.
Management has guided for a double-digit growth in revenues for FY16.
Exhibit 1: Consolidated revenue trend (INR m)
Consolidated Revenue (INR m)
26.6
9.0
10.2
12,171
13,746
18,333
4.4
Growth (YoY) %
11.4
-6.0
12,919
15,534
12,702
20,425
2.2
15,874
22.3
11.5
14,094
Source: Company, MOSL
Exhibit 2: EBITDA trend (INR m)
EBITDA
14.8
12.5
12.4
14.0
2,562
1,523 1,710
1,492
2,006 1,572
12.9
Margins (%)
13.7
12.4
11.5
2,806
13.7
Exhibit 3: PAT trend (INR m)
PAT
-1.5
742
-51
203
263
-64
Growth (%)
0.0
-145
1,029
91.8
38.6
390
-93.7 1.5
2,175
0.0
364
NM
NM
2,086
Source: Company, MOSL
Source: Company, MOSL
11 August 2015
2

Jain Irrigation
MIS reports 5% growth led by retail and projects business
n
n
n
n
MIS business grew by 5.1% to INR4.5b. While domestic MIS achieved growth of
9.6% YoY, overall MIS business grew only by 5.1% YoY due to weak export
demand, where export revenues declined 38%.
Domestic MIS business was impacted due to muted demand on account of
untimely rains and early monsoon.
Management pointed out that Gujarat, Andhra Pradesh and Rajasthan
experienced positive growth in MIS business. However, due to the weak sugar
prices, subdued demand from sugarcane farmers led to de-growth in
Maharashtra business.
JI has an outstanding order book of INR4b in the MIS business.
MIS business contribution by segment
Segment
Retail
Project
Export
Total
1QFY15
72%
19%
9%
100%
1QFY16
74%
20%
6%
YoY
2%
1%
-4%
Exhibit 4: MIS business growth by segment
Segment
Retail
Project
Export
Total
1QFY15
3,170
823
413
4,406
1QFY16
3,445
929
258
4,632
YoY
9%
13%
-38%
5%
100%
0%
Source: Company, MOSL
Government subsidies higher due to higher share of AP / Guj business
n
n
n
Government subsidy receivables have increased from INR2.6b as at 4QFY15 to
INR2.9b in 1QFY16, a growth of 15% QoQ. Management pointed out that the
increase has been because of resumption of business in Andhra Pradesh (192%
growth YoY) and higher growth in Gujarat business (20% YoY).
With programs in place in Gujarat and Andhra Pradesh where the business is
mandated through government corporations, the government subsidy
receivable has seen an increase. Since the increase is on account of fresh orders,
management doesn’t see any receivables issues impacting business.
Subsidy receivables have reduced from INR9.7b in FY12 to INR2.9b in 1QFY16.
This has been led shift in favor of business to more progressive states like
Maharashtra, Gujarat and Rajasthan.
Exhibit 5: Break-up of MIS receivables (INR b)
MIS -Receivables
Dealer and Institutional
Project
Govt. Subsidy
Export
Total
FY12
2.5
3.1
9.7
0.6
17.7
FY13
1.7
2.4
7.1
0.4
12.7
FY14 1QFY15 2QFY15 3QFY15 4QFY15 1QFY16
2.2
3.4
3.9
1.0
11.9
2.1
4.0
3.4
0.8
11.5
1.7
4.4
2.6
0.6
10.5
1.5
3.4
2.7
0.7
9.6
1.6
2.9
2.6
0.8
2.6
3.3
3.0
0.5
9.4
9.1
Source: Company, MOSL
11 August 2015
3

Jain Irrigation
MIS working capital improvement on right trajectory
n
n
n
MIS net working capital improved by 30 days YoY from 235 days in 1QFY15 to
205 days in 1QFY16.
MIS Debtors days showed a significant improvement of 56 days from 243 days in
1QFY15 to 187 days in 1QFY16.
Inventory days improved by 11 days YoY to 92 days in 1QFY16.
Exhibit 7: MIS networking capital on improvement trajectory
Growth (YoY %)
29.6
3.8
-10.5
5.1
Net Working Capital
296
317
306
255
235
255
245
217
205
Exhibit 6: MIS revenue trend
MIS revenue (INR M)
24.8
25.7
17.2
10.2
16.5
3,855 2,933
4,074 6,225 4,248 3,801
6,462 4,465
3,647
Source: Company, MOSL
Source: Company, MOSL
Exhibit 8: MIS debtors decreased by 56 days YoY
308
Debtor days (Gross)
279
265
257
243
211
Exhibit 9: MIS inventory days reduced by 11 days YoY
Inventory days
116
113
113
197
188
187
98
103
102
101
85
92
Source: Company, MOSL
Source: Company, MOSL
Piping business posts strong growth led by PE piping
n
n
n
n
n
n
PE piping business grew by 100% YoY to INR1.4b in 1QFY16. Demand in PE
piping was driven by large orders from telecom players.
Piping business benefitted from the declining polymer prices (led by lower crude
oil prices), since polymer constitutes more than 50% of the inputs.
Management expects piping business to post ~20% growth in FY16.
Inventory days in piping business increased by 11 days YoY to 48 days.
Debtor days in piping business increased by 26 days YoY to 70 days.
Net working capital days in piping business increased by 4 days to -16 days.
11 August 2015
4

Jain Irrigation
Exhibit 10: PVC Piping revenue trend
36.5
PVC Pipes Revenue (INR m)
-8.3
-20.6
21.5
Growth (YoY %)
12.2
1.0
1,323
-11.1
1,757
2,738
2,604
-11
-16
-20
-7
-8
-11
Exhibit 11: Piping net working capital days negative
1.6
3,247
1,089
3.0
-1
-16
2,440 2,578
1,976
Net Working Capital -31
Source: Company, MOSL
Source: Company, MOSL
Exhibit 12: Piping inventory days up 9 days YoY
Inventory days
58
60
54
35
37
37
40
44
48
Exhibit 13: Piping receivable days up by 39 days YoY
Debtor days (Gross)
67
58
39
51
49
61
90
70
44
Source: Company, MOSL
Source: Company, MOSL
Exhibit 14: PE piping revenues trend (INR m)
PE Piping Revenue
197.7
95.9
-3.3
22.8
-7.5
696
-55.4
753
-29.4
1,044
2,126 1,391
68.9
100.0
Growth (YoY %)
Exhibit 15: PVC Sheets revenues trend (INR m)
PVC Sheets revenue
117
65
22
-17
342
539
604
676
19.1
-30.0 -39.2 -41.1
407 377 367 398
0.0
407
Rev. YoY
752 1,688 1,479 1,259
Source: Company, MOSL
Source: Company, MOSL
Food processing business de-grows 3.1%
n
n
Revenue from food processing division de-grew 3.1% YoY to INR1.9b.
Management highlighted that de-growth was because of a higher base last year
where 1QFY15 was characterized by above average lifting of fruit pulp by some
of the domestic customers.
Demand for fruit juices was slow on account of untimely rains, which in turn
affected the demand for fruit pulp resulting in lower off take by customers.
However, export sales in fruit processing markets showed a strong growth of
92.1% YoY.
5
11 August 2015

Jain Irrigation
n
n
n
n
n
n
Management expects food processing business to post ~20% growth in FY16.
Food processing inventory days decreased by 1 day YoY to 263 days. However
Debtor days were up by 31 days to 118 days.
Net working capital saw an increase of 60 days YoY to 236 days.
Management highlighted that as at 1QFY16, JI already has a confirmed order
book of INR4.9b against the estimated production of INR5.5b for mango
products in this season, at the desired margins, providing good visibility.
Management highlighted that the process for subsidiarisation and 25% stake
sale is on track, with transaction finalization likely by October, 2015.
We believe 25% stake sale in food processing will unlock value for Jain Irrigation
and will set a valuation benchmark for the food processing business, along with
paring down debt at the parent level.
Exhibit 17: Fruit processing growth trend
Rev. YoY
Fruit Processing revenue (INR m)
50.7
49.1
39.6
47.6
24.6
-3.1
632
-16.3
881
913
963
1,946 1300
-12.2
802
19.4
Rev. YoY
Exhibit 16: Dehydrated Onions growth trend
Onion Dehydration revenue (INR m)
74.9
8.9
495
439
-29.5
172
920
652
616
272
1,231
19.3 31.7
40.4
58.3 33.8
-3.1
2,324 1260
1,200
Source: Company, MOSL
Source: Company, MOSL
Exhibit 18: FP inventory days down 1 day YoY
Inventory days
345
315
286
190
264
276
263
157
Exhibit 19: FP receivable days up 31 days YoY
Debtor days (Gross)
133
102
98
118
246
66
66
88
48
87
Source: Company, MOSL
Source: Company, MOSL
Exhibit 20: FP net working capital days increased by 60 days YoY
Net Working Capital
195
226
236
197
162
155
176
135
78
1QFY14
2QFY14
3QFY14
4QFY14
1QFY15
2QFY15
3QFY15
4QFY15
1QFY16
Source: Company, MOSL
11 August 2015
6

Jain Irrigation
Net working capital on consolidated basis decreased by 6 days YoY
n
On a consolidated (C/L) basis net working capital decreased from 145 days to
139 days in 1QFY16 (144 days in 4QFY15).
Exhibit 22: C/L receivable days declined by 13 days YoY
Debtor days (Gross)
124
107
121
137
141
123
129
122
115
106
115
109
Exhibit 21: C/L inventory days up by 2 days YoY
Inventory days
137
135
126
104
119
121
Source: Company, MOSL
Source: Company, MOSL
Exhibit 23: C/L net working capital days decreased by 6 days YoY
Net Working Capital
162
174
161
142
145
158
154
144
139
Source: Company, MOSL
Consolidated debt to reduce by INR3b annually
n
n
n
n
n
n
n
Consolidated Net debt for 1QFY16 stood at INR40.2b as against INR39.3b in
4QFY15, an increase of INR0.9b on a QoQ basis.
On a YoY basis debt increased by INR0.4b from INR39.8b to INR40.2b.
Management aims to end FY16 on a net debt of INR36.0b, with reduction be
largely back-ended in second half of FY16.
Management highlighted that out of the INR0.9b QoQ increase in debt, INR0.4b
is because of foreign exchange mark to market impact of INR depreciation.
57% of net debt on consolidated basis is in foreign currency.
Management is targeting to reduce debt by atleast INR3b annually in FY16 and
FY17. Annual capex is expected to be contained at INR1.5b including
maintenance capex.
SAFL has an outstanding loan book of INR1.7b and NPAs are less than 1%.
Management doesn’t see any stress of asset quality and doesn’t expect any
recovery related issues.
11 August 2015
7

Jain Irrigation
Exhibit 24: Standalone net debt
Standalone Net Debt (INR b)
31.6 31.7
31.1
29.4
28.2
28.6
29.19
40.1
Exhibit 25: Consolidated net debt
Consolidated Net Debt (INR b)
41.9
42
38.9
39.8
42.4
42.9
39.3
40.21
29.9
30.8
Source: Company, MOSL
Source: Company, MOSL
Exhibit 26: Debt Equity to decline from 1.6x in FY15 to 1.1x in FY17
Net Debt (INR m)
2.0
1.8
Net DER (x)
1.6
1.6
1.4
1.1
34,442
35,654
38,601
38,649
34,110
30,260
FY12
FY13
FY14
FY15
FY16E
FY17E
Source: Company, MOSL
Other key highlights from the earnings call:
n
n
n
View on PMKSY:
Management views Pradhan Mantri Krishi Sinchai Yojana
(PMKSY) as an amalgamation of different government programmes to facilitiate
district level irrigation through building water sheds, transporting water from
the sheds to villages and distribution of this water through drip and sprinkler
irrigation. 75% of the amount will be funded by centre while 25% will be state-
funded. Districts are expected to come up with plans, which is expected to
happen by December 2015, and further clarity on this should come by FY16 end.
Rathmal project:
Irrigation project in Rathmal, Karnataka costing about INR3b is
expected to be completed by October 2015. This project is an end to end
solution for 10,000 farmers that includes drip irrigation and technology
initiatives to measure moisture, providing water, monitoring by a control system
and updating about the same through SMS. It is a dynamic first kind of its kind
high tech system. This will lead to better crop productivity, monitoring and
knowledge transfer. Management expects more such projects in future.
Overseas operations:
Management saw overseas operations to be mixed
primarily being impacted by externalities. Israel operations showed decent
growth but the currency fluctuations affected reported results, while Turkey,
Peru and Brazil business were affected by commodity and currency turmoil.
Outlook:
Management expects a strong 3Q and 4Q in FY16. It believes there is
further decline possible in polymer prices, which can lead to a further margin
expansion along with benign oil prices. However, they believe 2QFY16 also to be
soft with growth pick up likely only in 3Q.
8
11 August 2015

Jain Irrigation
Valuation and view
We value JI at a multiple of 12x FY17E EPS, (discount to long term average multiple
of 33.7x), which we believe is justified considering:
India’s largest MIS player with a dominant market share of 55%
JI is the largest player in India's organized micro irrigation sector, with a dominant
market share of 55% and much higher than the second largest player Netafim (20%
market share). There remains immense potential for micro irrigation in India as out
of total irrigation potential of ~140 Mha and MIS potential of ~69.5 Mha, only 5 Mha
(~3.5% of the total irrigation potential) is covered under MIS currently, implying
significant growth potential over the long term. JI with its dominant market
leadership is best placed to capture this growth potential.
Change in business model to drive de-leveraging
JI has changed its business model to ensure that the company is not exposed to
payment delays associated with subsidy receivables. Management is targeting to
reduce gross receivable days to 130 in FY16 which should ensure annual debt
reduction of INR3b purely due to better working capital management. Additionally,
the company is looking to raise INR5b in FY16 from 25% stake sale in its food
processing business, proceeds of which would go towards further debt retirement.
We have not factored this scenario in our forecasts, which can potentially reduce
debt by another INR5b in FY16. We expect strong free cash generation, which
should reduce debt-equity from 1.6x to 1.1x over FY15-17E.
Strong leadership in the high-growth food processing business
JI is India’s largest player in the food processing sector, with a market share of ~30%
and is the third largest in the world. Only 2% of India’s total produce is processed,
compared to ~60-80% in some developed countries (80% US and Malaysia). Also,
India's share in the global food trade is a miniscule 1.5%. Given the growing demand
for processed food, due to lifestyle changes and storage advantages, the segment is
expected to be a strong growth driver for the company.
Exhibit 27: 15-year PE band
65
52
4.5
39
26.0
26
13
0
21.4
Negative
Earnings
Cycle
14.6
33.7
3.0
1.5
0.0
2.9
2.2
2.2
1.3
P/E (x)
5 Yrs Avg(x)
15 Yrs Avg(x)
10 Yrs Avg(x)
Exhibit 28: 15-year PB band
P/B (x)
15 Yrs Avg(x)
10 Yrs Avg(x)
6.0
5 Yrs Avg(x)
Source: Company, MOSL
Source: Company, MOSL
We value the stock at 12x FY17E EPS and arrive at a target price of INR84 – 20%
upside. Maintain
Buy
rating.
11 August 2015
9

Jain Irrigation
Story in charts
Exhibit 29: JI is the market leader in MIS business in India
Market share of key players in micro irrigation systems in India
55%
Exhibit 30: MIS penetration in India is lowest in world
90%
MIS penetration across countries (%)
78%
65%
55%
52%
20%
25%
10%
3%
India
Jain Irrigation
Netafim
Others
Source: Company, MOSL
Israel
Russia
Spain
US
Brazil
China
Source: Company, MOSL
Exhibit 31: Gross debtors set to decline
Gross Sundry Debtors
369
343
334
257
188
150
130
Exhibit 32: Hence, debt to equity to decline from 1.6x to 1.1x
Net Debt (INR m)
2.0
1.8
Net DER (x)
1.6
1.6
1.4
1.1
34,442
35,654
38,601
38,649
34,110
30,260
0
0
0
0
FY11 FY12 FY13 FY14 FY15 FY16E FY17E
Source: Company, MOSL
FY12
FY13
FY14
FY15
FY16E
FY17E
Source: Company, MOSL
Exhibit 33: Food processing is another key opportunity for JI
% of food processing
80%
80%
70%
Exhibit 34: RoE to improve
13.5
RoE (%)
12.3
7.4
30%
2.4
2%
USA
Malaysia
France
Thailand
India
FY12
FY13
FY14
FY15
FY16E
FY17E
3.1
3.8
Source: Company, MOSL
Source: Company, MOSL
11 August 2015
10

Jain Irrigation
Key assumptions
Exhibit 35:
Key
assumptions
Assumptions
1. Micro Irrigation Systems
% growth (YoY)
% of net sales
2. Plastic Piping Systems
% growth (YoY)
% of net sales
3. Agro Processing
% growth (YoY)
% of net sales
4. Others
% growth (YoY)
% of net sales
5. Net Subsidiary Sales
% growth (YoY)
% of net sales
Total Gross Sales
Less: Excise Duty
Net Sales
% growth (YoY)
FY13
14,040
-26%
27%
11,157
13%
22%
5,399
4%
11%
3,039
35%
6%
16,156
33%
31%
51,334
1,117
50,217
2%
FY14
17,087
22%
29%
13,929
25%
23%
6,729
25%
11%
2,675
-12%
4%
17,277
7%
29%
59,859
1,578
58,281
16%
FY15
18,158
6%
29%
13,015
-7%
21%
8,397
25%
13%
2,465
-8%
4%
19,562
13%
31%
63,147
1,566
61,581
6%
FY16E
19,974
10%
29%
14,415
11%
21%
9,436
12%
14%
2,778
13%
4%
20,149
3%
29%
68,415
1,697
66,718
FY17E
22,371
12%
29%
16,332
13%
21%
11,369
20%
15%
3,141
13%
4%
23,171
15%
30%
78,184
1,939
76,245
8%
14%
Source: Company, MOSL
11 August 2015
11

Jain Irrigation
Financials and valuations
Consolidated - Income Statement
Y/E March
Net Sales
Change (%)
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income - Rec.
PBT bef. EO Exp.
EO Expense/(Income)
PBT after EO Exp.
Current Tax
Deferred Tax
Tax Rate (%)
Reported PAT
PAT Adj for EO items
Change (%)
Margin (%)
FY10
34,200
19.6
6,698
19.6
1,020
5,679
2,194
197
3,682
0
3,682
979
224
32.7
2,478
2,478
85.6
7.2
FY11
41,528
21.4
7,480
18.0
1,222
6,258
3,270
1,106
4,094
0
4,094
1,177
37
29.6
2,881
2,881
16.2
6.9
FY12
49,206
18.5
8,155
16.6
1,441
6,714
4,768
345
2,290
0
2,290
-419
422
0.2
2,286
2,286
-20.6
4.6
FY13
50,217
2.1
7,253
14.4
1,696
5,558
4,855
668
1,370
1,245
125
175
-95
63.9
45
495
-78.4
1.0
FY14
58,281
16.1
7,700
13.2
2,045
5,654
4,676
463
1,441
2,300
-860
233
-695
53.7
-398
667
34.9
1.1
FY15
61,579
5.7
7,876
12.8
2,441
5,435
4,693
331
1,074
763
311
-239
0
NM
550
859
28.8
1.4
FY16E
66,718
8.3
9,007
13.5
2,546
6,461
4,555
334
2,239
347
1,892
378
0
20.0
1,514
1,791
108.6
2.7
(INR Million)
FY17E
76,245
14.3
10,328
13.5
2,675
7,653
3,994
381
4,040
0
4,040
808
0
20.0
3,232
3,232
80.4
4.2
Consolidated - Balance Sheet
Y/E March
Equity Share Capital
Equity Share Warrants
Total Reserves
Preference Capital
Net Worth
Minority Interest
Deferred Liabilities
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Deferred Tax Assets
Appl. of Funds
FY10
760
0
11,384
23
12,167
571
1,024
24,448
38,210
23,266
6,667
16,599
1,324
211
29,672
10,638
10,099
5,053
3,883
10,011
7,045
2,279
687
19,662
414
38,210
FY11
772
348
14,439
0
15,558
524
1,239
29,842
47,164
28,467
8,050
20,417
956
211
41,396
14,864
16,924
4,144
5,463
16,394
12,696
2,977
720
25,002
577
47,164
FY12
810
348
16,378
0
17,537
498
1,755
37,986
57,775
33,528
9,793
23,735
1,980
236
48,180
14,614
22,712
3,308
7,546
17,073
13,692
2,673
708
31,107
718
57,775
FY13
910
162
20,608
0
21,680
0
1,841
38,051
61,572
37,726
11,640
26,086
749
38
50,405
17,231
19,547
2,359
11,269
16,636
13,379
2,716
541
33,770
929
61,572
FY14
925
0
20,831
0
21,755
205
1,412
40,583
63,955
41,514
13,742
27,771
807
14
52,258
18,364
17,994
1,968
13,932
18,089
13,433
4,040
617
34,169
1,194
63,955
FY15
925
0
22,690
0
23,615
0
1,201
42,311
67,127
44,316
16,183
28,133
0
621
53,687
18,566
19,541
3,041
12,539
16,672
13,568
2,575
529
37,015
1,358
67,127
FY16E
925
0
23,938
0
24,863
0
1,201
38,311
64,375
46,616
18,729
27,887
0
621
54,112
19,742
18,908
3,580
11,881
19,603
16,230
2,742
631
34,509
1,358
64,375
(INR Million)
FY17E
925
0
26,906
0
27,830
0
1,201
34,311
63,343
48,916
21,404
27,512
0
621
56,686
22,466
19,300
3,430
11,489
22,834
18,994
3,133
706
33,851
1,358
63,343
11 August 2015
12

Jain Irrigation
Financials and valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
Working Capital Ratios
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Working Capital Turnover (Days)
Leverage Ratio (x)
Debt/Equity
FY10
6.5
9.2
32.0
0.8
16.3
FY11
7.5
10.6
40.3
1.0
15.6
FY12
5.6
9.2
43.3
1.0
20.6
FY13
1.1
4.8
47.7
0.6
588.3
FY14
1.4
5.9
47.0
0.6
-68.0
48.5
11.9
1.5
1.2
9.2
0.8
23.3
18.4
0.9
113.5
108
75
156
2.0
20.2
18.0
0.9
130.6
149
112
183
1.9
13.5
14.0
0.9
108.4
168
102
206
2.2
2.4
10.8
0.8
125.2
142
97
228
1.8
3.1
10.0
0.9
115.0
113
84
202
1.9
FY15
1.9
7.1
51.1
0.6
49.2
37.7
9.8
1.4
1.2
9.1
0.8
3.8
9.0
0.9
110
116
80
201
1.8
FY16E
3.9
9.4
53.8
0.6
17.9
18.1
7.5
1.3
1.0
7.4
0.8
7.4
10.5
1.0
108.0
103
89
169
1.5
FY17E
7.0
12.8
60.2
0.6
8.4
10.0
5.5
1.2
0.8
6.1
0.8
12.3
12.8
1.2
107.6
92
91
146
1.2
Consolidated-Cash Flow Statement
Y/E March
Net Profit / (Loss) Before Tax
Depreciation
Interest & Finance Charges
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
Others
CF from Operating incl EO
(inc)/dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Issue of Shares
(Inc)/Dec in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Balance
Closing Balance
FY10
3,682
1,020
2,194
706
-2,408
3,781
151
3,932
-4,646
-714
-10
87
-4,569
435
6,693
-2,232
-219
-39
4,637
4,000
1,053
5,053
FY11
4,094
1,222
2,717
1,047
-6,069
916
143
1,059
-4,930
-3,871
-142
64
-5,007
780
5,507
-2,717
-355
-62
3,153
-796
4,940
4,144
FY12
2,286
1,441
4,157
938
-6,166
781
69
850
-5,270
-4,420
-114
55
-5,330
14
8,143
-4,051
-448
16
3,674
-805
4,114
3,308
FY13
125
1,696
4,855
295
-3,127
3,254
1,021
4,275
-2,943
1,333
-459
20
-3,383
3,903
-586
-4,843
-469
162
-1,832
-939
3,298
2,359
FY14
-860
2,045
4,676
41
-1,551
4,270
1,461
5,731
-2,615
3,116
-407
138
-2,885
0
1,216
-4,638
-265
485
-3,202
-356
2,324
1,968
FY15
1,074
2,441
4,361
-239
-1,383
6,732
-763
5,969
-1,996
3,973
0
331
-1,664
0
1,728
-4,693
-270
4
-3,231
1,073
1,968
3,041
FY16E
2,239
2,546
4,222
378
3,045
11,674
-347
11,326
-2,300
9,026
0
334
-1,966
0
-4,000
-4,555
-270
5
-8,821
539
3,041
3,580
(INR Million)
FY17E
4,040
2,675
3,613
808
508
10,028
0
10,028
-2,300
7,728
0
381
-1,919
0
-4,000
-3,994
-270
6
-8,259
-150
3,580
3,431
11 August 2015
13

Jain Irrigation
Corporate profile: Jain Irrigation
Company description
Established in 1986, JI is a transnational
organization
headquartered
at
Jalgaon,
Maharashtra, India. JI employs over 5,000
associates and manufactures a number of
products, including drip and sprinkler irrigation
systems, PVC & PE piping systems, plastic sheets,
green houses, bio-fertilizers, solar products
including water-heating systems, photovoltaic
appliances and solar pumps. JI processes fruits and
vegetables into aseptic concentrates, frozen fruits
and dehydrated vegetables, respectively. It has 21
manufacturing plants spread over 5 continents and
its products are supplied to 110 countries through
3,000 dealers and distributors worldwide.
Exhibit 36: Sensex rebased
120
100
80
60
40
Aug-14
Nov-14
Feb-15
May-15
Aug-15
Jain Irrigation
Sensex - Rebased
Exhibit 37: Shareholding pattern (%)
Jun-15
Promoter
DII
FII
Others
28.7
2.0
41.6
27.7
Mar-15
28.7
1.6
40.5
29.3
Jun-14
28.7
3.5
51.0
16.8
Exhibit 38: Top holders
Holder Name
MKCP Institutional Investor (Mauritius) II Ltd
International Finance Corporation
Templeton Funds -Templeton Foreign Fund
Macquarie Bank Ltd
Government Pension Fund Global
% Holding
7.9
3.0
2.7
2.3
1.9
Note: FII Includes depository receipts
Exhibit 39: Top management
Name
Bhavarlal H Jain
Ashok B Jain
Anil B Jain
Ajit B jain
Atul Bhavarlal Jain
Designation
Chairman
Vice Chairman
Managing Director
Joint Managing Director
Joint Managing Director
Exhibit 40: Directors
Name
Bhavarlal H Jain
Ashok B Jain
Anil B Jain
Ajit B jain
Atul Bhavarlal Jain
D R Mehta*
Name
Vasant V Warty*
Ghanshyam Dass*
Arun Kumar Jain*
Radhika C Pereira*
R Swaminathan
H P Singh
*Independent
Exhibit 41: Auditors
Name
Haribhakti & Co
Ernst & Young
Type
Statutory
Internal
Exhibit 42: MOSL forecast v/s consensus
EPS
(INR)
FY16
FY17
MOSL
forecast
3.9
7.0
Consensus
forecast
4.2
6.8
Variation
(%)
-6.5
2.6
11 August 2015
14

Jain Irrigation
NOTES
11 August 2015
15

Jain Irrigation
This document has been prepared by Motilal Oswal Securities Limited (hereinafter referred to as Most) to provide information about the company(ies) and/sector(s), if any, covered in the report and may be distributed
by it and/or its affiliated company(ies). This report is for personal information of the selected recipient/s and does not construe to be any investment, legal or taxation advice to you. This research report does not
constitute an offer, invitation or inducement to invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for
public distribution and has been furnished to you solely for your general information and should not be reproduced or redistributed to any other person in any form. This report does not constitute a personal
recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Before acting on any advice or recommendation in this material, investors should consider
whether it is suitable for their particular circumstances and, if necessary, seek professional advice. The price and value of the investments referred to in this material and the income from them may go down as well as
up, and investors may realize losses on any investments. Past performance is not a guide for future performance, future returns are not guaranteed and a loss of original capital may occur.
MOSt and its affiliates are a full-service, integrated investment banking, investment management, brokerage and financing group. We and our affiliates have investment banking and other business relationships with a
some companies covered by our Research Department. Our research professionals may provide input into our investment banking and other business selection processes. Investors should assume that MOSt and/or
its affiliates are seeking or will seek investment banking or other business from the company or companies that are the subject of this material and that the research professionals who were involved in preparing this
material may educate investors on investments in such business. The research professionals responsible for the preparation of this document may interact with trading desk personnel, sales personnel and other
parties for the purpose of gathering, applying and interpreting information. Our research professionals are paid on the profitability of MOSt which may include earnings from investment banking and other business.
MOSt generally prohibits its analysts, persons reporting to analysts, and members of their households from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover.
Additionally, MOSt generally prohibits its analysts and persons reporting to analysts from serving as an officer, director, or advisory board member of any companies that the analysts cover. Our salespeople, traders,
and other professionals or affiliates may provide oral or written market commentary or trading strategies to our clients that reflect opinions that are contrary to the opinions expressed herein, and our proprietary
trading and investing businesses may make investment decisions that are inconsistent with the recommendations expressed herein. In reviewing these materials, you should be aware that any or all of the foregoing
among other things, may give rise to real or potential conflicts of interest. MOSt and its affiliated company(ies), their directors and employees and their relatives may; (a) from time to time, have a long or short position
in, act as principal in, and buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation
or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with
respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific recommendations made by the analyst(s), as the recommendations
made by the analyst(s) are completely independent of the views of the affiliates of MOSt even though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report
Reports based on technical and derivative analysis center on studying charts company's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as
such, may not match with a report on a company's fundamental analysis. In addition MOST has different business segments / Divisions with independent research separated by Chinese walls catering to different set
of customers having various objectives, risk profiles, investment horizon, etc, and therefore may at times have different contrary views on stocks sectors and markets.
Unauthorized disclosure, use, dissemination or copying (either whole or partial) of this information, is prohibited. The person accessing this information specifically agrees to exempt MOSt or any of its affiliates or
employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSt or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOSt or any of
its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The information contained herein is
based on publicly available data or other sources believed to be reliable. Any statements contained in this report attributed to a third party represent MOSt’s interpretation of the data, information and/or opinions
provided by that third party either publicly or through a subscription service, and such use and interpretation have not been reviewed by the third party. This Report is not intended to be a complete statement or
summary of the securities, markets or developments referred to in the document. While we would endeavor to update the information herein on reasonable basis, MOSt and/or its affiliates are under no obligation to
update the information. Also there may be regulatory, compliance, or other reasons that may prevent MOSt and/or its affiliates from doing so. MOSt or any of its affiliates or employees shall not be in any way
responsible and liable for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. MOSt or any of its affiliates or employees do not provide, at any time,
any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement.
The recipients of this report should rely on their own investigations.
This report is intended for distribution to institutional investors. Recipients who are not institutional investors should seek advice of their independent financial advisor prior to taking any investment decision based on
this report or for any necessary explanation of its contents.
Most and it’s associates may have managed or co-managed public offering of securities, may have received compensation for investment banking or merchant banking or brokerage services, may have received any
compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past 12 months.
Most and it’s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report.
Subject Company may have been a client of Most or its associates during twelve months preceding the date of distribution of the research report
MOSt and/or its affiliates and/or employees may have interests/positions, financial or otherwise of over 1 % at the end of the month immediately preceding the date of publication of the research in the securities
mentioned in this report. To enhance transparency, MOSt has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the
report.
Motilal Oswal Securities Limited is registered as a Research Analyst under SEBI (Research Analyst) Regulations, 2014. SEBI Reg. No. INH000000412
There are no material disciplinary action that been taken by any regulatory authority impacting equity research analysis activities
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be
directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report. The research analysts, strategists, or research associates principally responsible for preparation
of MOSt research receive compensation based upon various factors, including quality of research, investor client feedback, stock picking, competitive factors and firm revenues
Disclosure of Interest Statement
§
Analyst ownership of the stock
§
Served as an officer, director or employee
JAIN IRRIGATION
No
No
Disclosures
A graph of daily closing prices of securities is available at www.nseindia.com and http://economictimes.indiatimes.com/markets/stocks/stock-quotes
Regional Disclosures (outside India)
For U.S.
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law,
regulation or which would subject MOSt & its group companies to registration or licensing requirements within such jurisdictions.
Motilal Oswal Securities Limited (MOSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state laws in the United States. In
addition MOSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the
United States. Accordingly, in the absence of specific exemption under the Acts, any brokerage and investment services provided by MOSL, including the products and services described herein are not available to or
intended for U.S. persons.
This report is intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional
investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major
institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the
"Exchange Act") and interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOSL has entered into a chaperoning
agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this
chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, MOSIPL,
and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account.
Motilal Oswal Capital Markets Singapore Pte Limited is acting as an exempt financial advisor under section 23(1)(f) of the Financial Advisers Act(FAA) read with regulation 17(1)(d) of the Financial Advisors
Regulations and is a subsidiary of Motilal Oswal Securities Limited in India. This research is distributed in Singapore by Motilal Oswal Capital Markets Singapore Pte Limited and it is only directed in Singapore to
accredited investors, as defined in the Financial Advisers Regulations and the Securities and Futures Act (Chapter 289), as amended from time to time.
In respect of any matter arising from or in connection with the research you could contact the following representatives of Motilal Oswal Capital Markets Singapore Pte Limited:
Kadambari Balachandran
Email : kadambari.balachandran@motilaloswal.com
Contact : (+65) 68189233 / 65249115
Office Address : 21 (Suite 31),16 Collyer Quay,Singapore 04931
For Singapore
11 August 2015
Motilal Oswal Securities Ltd
Motilal Oswal Tower, Level 9, Sayani Road, Prabhadevi, Mumbai 400 025
Phone: +91 22 3982 5500 E-mail: reports@motilaloswal.com
16