Jain Irrigation may turn profitable; Q1 net seen at Rs 41cr
Jain Irrigation Systems' revenues may grew by 14.1 percent on yearly basis to Rs 987 crore during April-June quarter, driven by revival in micro irrigation systems (MIS).
August 13, 2013 / 06:29 PM IST
Jain Irrigation Systems will declare its first quarter earnings on Wednesday. Analysts on an average expect the company to report a profit of Rs 40.8 crore during the quarter as against a loss of Rs 16.88 crore in a year ago period.
In first quarter of FY13, it had posted a loss due to foreign exchange loss of Rs 79.5 crore and finance cost of Rs 102.8 crore.
Revenues may grew by 14.1 percent on yearly basis to Rs 987 crore during April-June quarter, driven by revival in micro irrigation systems (MIS).
Earnings before interest, tax, depreciation & amortisation (EBITDA) are likely to fall by 4.5 percent Y-o-Y to Rs 173 crore, and operating profit margin may decline by 346 bps Y-o-Y to 17.5 percent in first quarter as input cost pressures are expected to weigh down on gross margins.
Also Read - Jain Irrigation aims to reduce debt by Rs 500cr in FY14
After several quarters of subdued business performance, the company is expected to see revival in revenue growth in FY14.
Some stabilisation started in Q4FY13, which showed revenue growth of 2.5 percent as against decline for past four consecutive quarters.
In the June quarter itself, the management has guided to revenue growth of at least 15 percent in the MIS division (which contributes around 40 percent to total revenues).
MIS revenues fell by 25 percent in FY13 due to weak demand on account of a changed business model and drought-like conditions in the key state of Maharashtra.
Interest costs could dip as the company repaid USD 45 million in foreign currency debt only at the end of the March quarter.
Key things to watch out for:
Receivables/balance sheet/working capital
Company said it plans to sell the wind power business to bring down its debt by Rs 63 crore