Turns red in Q3 with Rs 31-crore loss
Jain Irrigation has reported a loss of Rs 31 crore in the December quarter against a profit of Rs 1 crore in the same period last year.
The loss was largely because of a slowdown in the micro-irrigation business and a forex loss of Rs 57 crore. Net sales were down eight per cent at Rs 750 crore (Rs 816 crore).
Earning before interest, depreciation and tax amortisation for the quarter was down 27 per cent at Rs 138 crore (Rs 190 crore). Finance cost was marginally higher at Rs 95 crore (Rs 93 crore). The company has been slowing down in the micro-irrigation area as part of its strategy to improve cash-flow by mitigating the risk of government subsidy receivables.
Anil Jain, Managing Director, Jain Irrigation, said this has been another challenging quarter, given the erratic monsoon, liquidity concerns and high input costs.
“Overall gross receivables were down by about Rs 500 crore in first nine months of the company’s operations. The operations of our NBFC Sustainable Agro-Commercial Finance will help rebuild growth in the micro-irrigation business next year,” he said.
The company is receiving acceptance from dealers and farmers in Maharashtra of the changed business model and it will take this further in the current and future quarters, it said.
Jain Irrigation raised about $200 million (Rs 1,100 crore) through equity, foreign currency convertible bonds and external commercial borrowing. The funds will be used to repay short-term loans, for capital expenditure and investments in affiliate NBFC and overseas subsidiaries by March. This will result in substantial interest saving in the first quarter next fiscal, it said.
With an order book of Rs 891 crore, the company looks forward to a better performance in the fourth quarter.
The Jain Irrigation share was down 5 per cent at Rs 68 on Tuesday.