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Jain Irrigation has announced its second quarter numbers. It has posted net profit of Rs 30 crore for the quarter ended September 2007 as against Rs 16.2 crore in same quarter of last year. Net sales stood at Rs 329 crore versus Rs 226 crore.

Anil Jain , MD, Jain Irrigation informs that the company's piping division - PVC pipes business grew 27%; polyethylene pipe - based on the telecom and gas pipes orders grew 57%.

 

Excerpts from CNBC-TV18's exclusive interview with Anil Jain:

 

Q: Could you walk us through the performance of each one of your segments this quarter around and if you could also give us the sales figures?

 

A: Our sales for the quarter on a net basis is Rs 329 crore, which is about 45.5% growth over the same quarter last year, in total. Out of that, about 71% growth came in our domestic business and 14% came in on the export business.

 

If you look at the various segments that we have, micro-irrigation has done really well. It has grown about 72%, and this is the most profitable division for us. It has moved from about Rs 58 crore to about Rs 100 crore this quarter.

 

The piping division, PVC pipes business grew 27%, polyethylene pipe - based on the telecom and gas pipes orders grew 57%. The only division that did not do that well was the PVC sheets because it had exposure to US homebuilding market.

 

Q: For the full year, what kind of growth rate do you estimate agriculture to deliver and would that be the key driver?

 

A: Agriculture would remain a key driver. But as I said, based on infrastructure growth, our piping division is also growing significantly. So, I would say combination of both food processing, agriculture in terms of irrigation and pipes, together both rural and urban infrastructure, will continue to drive the growth.

 

Q: You are looking very actively at the African market; you are looking at ramping up your assets there. What kind of revenue potential does that market have for you and when will it accrue to your profit and loss account?

 

A: This year we are looking at about USD 10 million for each business already, in terms of exports of pipe and irrigation systems from that market. From next year onwards, once we have some kind of assets there, we expect that to kind of increase significantly. As of now, the domestic markets - they are really providing very good growth in food processing as well as irrigation and we see exports of even polyethylene pipes for telecom sector. We are exporting to Africa and Europe; that is doing well as well.

 

Q: You were talking about the US market and some amount of negative impact coming in from there. You have also got the NuCedar Mills. Are you planning to up your stake this quarter or within the next 6 months to 51%, and also business prospects in the US currently?

 

A: In the US, our business prospects in the onion dehydration business and irrigation are doing well. For the plastic sheet division, which this year would be 10% of the revenues, that division is having a negative impact because of the homebuilding market issues that are being faced in that segment. But overall it would not have much impact on the profitability of the entire corporate as such.