Buy Jain Irrigation; target of Rs 142: Edelweiss Securities

Edelweiss Securities' research report on Jain Irrigation

We met Mr. Anil Jain, MD, Jain Irrigation (JISL), to gain insights into the company’s business strategy. While it continues to perceive domestic MIS segment as a high potential opportunity, in the agro processing business JISL is eyeing entry in the complementary spices segment with the target of being a branded food player in the long run. Along with driving growth, JISL continues to focus on keeping debt at a manageable level and is targeting to prune net debt to INR20bn (FY17: INR31bn) aided by value unlocking in international MIS and agro processing segment. Maintain ‘BUY’.

Outlook
With strong cash flow generation, net D/E falling to 0.4x in FY19E from 0.7x and FY17- 19E EPS CAGR of 75%, we maintain ‘BUY’ with TP of INR142 (15x FY19E EPS).

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