Financial Daily from THE HINDU group of publications
Thursday, Mar 03, 2005
Financial Daily from THE HINDU group of publications Thursday, Mar 03, 2005 |
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Corporate
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Outlook Budget focus offers new biz avenues for Jain Irrigation Latha Venkatraman
Mumbai , March 2 The Government's thrust on micro-irrigation has already opened up business opportunities for Jain Irrigation Systems Ltd (JISL). Now the Union Budget of 2005-06 has further propelled the company to go in for capacity expansions in drip irrigation and increase its geographical reach. We are planning to increase drip irrigation capacity by at least 50-75 per cent. Besides, we plan to move into the northern and eastern region as our focus has been largely in the South and the West,'' Mr Anil Jain, CEO, Jain Irrigation Systems Ltd, said. The company, which sets up integrated microfinance projects, plans to increase its capabilities from Rs 200 crore business by another 50-75 per cent. The company, one of the early players in the area of micro-irrigation, has had the benefits of State Governments' serious foray into irrigation projects. So far it has bagged a number of projects in Andhra Pradesh and is due to commence work for Maharashtra. "Gujarat is also taking big initiatives in micro-irrigation," Mr Jain said. Today irrigation projects contribute 20 per cent to JISL's turnover as food processing, plastic piping, plastic sheet divisions being the other revenue contributors. The company had reported a turnover of Rs 405 crore for the year ended March 2004. But with a surge in irrigation projects due in the next few month, micro-irrigation could be a significant contributor as much as 50 per cent to the company's topline, Mr Jain said. The Finance Minister has provided Rs 400 crore for promoting micro-irrigation in 2005-2006. This according to Mr Jain could translate to Rs 800 crore business for the irrigation providers as Government fund contribution is to the extent of 50 per cent. Besides, the plan to promote micro-irrigation - drip and sprinkler irrigation - and increase the coverage of 3 million hectares by the end of the Tenth Plan from 1.2 million hectares now and further to 14 million hectares by the end of the Eleventh Plan would translate to large orders in the coming years, Mr Jain said. JISL is one of the leading players in micro-irrigation; there are about 50 players a couple of them from Israel. "As JISL has a market share of 50 per cent, we should hope to benefit from these projects," he said. The Government's plan to bring 10 million hectares of land under assured irrigation over a period of five years under the Bharat Nirman programme also could bring revenues for JISL as it is into piping used for irrigation and water supply.
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