JISL_Corporate Presentation March 2011 [Read-Only]

8/7/2019 JISL_Corporate Presentation March 2011 [Read-Only]

1/28

CORPORATEPRESENTATION

MoreCro PerDro

March 2011


2/28


3/28

Founder:Dr.Bhavarlal Jain(Bhau)

Borninafarmersfamilyinthetinyvillage(Wakod,Jalgaon)

FounderChairmanbeganin1963astraderinagricultureinputsandequipments

3


4/28

JainIrrigation Snapshot

ShareholdingFinancialSnapshot(RsMn)Introduction

OneofIndiasleadingagriculturesolutionproviderswithpresence

Promoter&

Promoter

GroupMF

2.6%

Others

11.4%

28,707

34,397

7,002 6,000

7,000

8,000

30,000

35,000

40,000

chain

Widedistributionpresenceover2500dealersinIndiaand

distributorsinternationally

30.8%22,529

3,843

4,577

1,324

1,294

2,476

1,000

2,000

3,000

4,000

5,000

5,000

10,000

15,000

20,000

25,000

Manufacturingfacilitiesandofficesin17countries

KeyBusinesses

FIIs

55.2%FY2008(Restated) FY2009 FY2010

TotalIncome OperatingProfit ProfitAsonDecember31,2010

MicroIrrigationSystems(MIS)

Drip&SprinklerSystems

PipingSystems

PVCPipesandfittings

PolyethylenePipes

AgroProcessedProducts

OnionDehydration

Others

RenewableEnergy

TissueCulture

Advisory

Rs18,722mn (54%)

TurnkeyProjects

Rs8,361mn (24%)

FruitProcessing

Rs5,015mn (15%)

PVCSheets

Rs2,424mn (7%)

Salesamountand%oftotalsalesforFiscal2010(Consol)

4

OneofthelargestmanufacturersofMISglobally,pipingsystemsinIndiaandoneofthelargestprocessorsoffruitsandvegetablesinIndia


5/28

BusinessOverview

5


6/28

JainIntegratedModel

HitechAgriInputs

eased

uctivity

uct

elopment

ConservationofResources Sustainable Environment

EnhancedProductivityCostSavings

Climate

Incr

Pro

Pro

Dev

WatershedPlanning

Water

harvestingSoil/WaterSavingWaterResourceEstimation

WasteLandReclamation

TissueCulturePlants

FertilizersGreenhousesPVCPipingSystems

HDPEPipingSystems

Soil WaterCredit

Adequate&Timely

Research&Development

AgronomicSupport

Knowledge

Manpower

epaymen&Security

ee ac

ImprovedProductQualityValueAdded

TurnkeyProjectsAgroConsultingMoreInvestments

Minimum

Guaranteed

Price

Quality

Goods

TrainingAgronomyServicesSurveysandAnalysis waterandsoil

IrrigationSchedulingFertigationScheduling

More

Pro itsContractFarmingDehydratedOnion

&VegetableProcessedFruit

Markets

UniqueTotalSolutionofferedtoFarmers6


7/28

LocalPresence DifficulttoReplicate

StateState PlantPlant OfficesOffices DepotsDepots DealersDealers

Maharashtra 3 16 9 1,164

AndhraPradesh 3 24 5 262

Karnataka

4 2 234Gujarat 2 5 2 207

MadhyaPradesh 1 3 161

TamilNadu 1 6 3 78

Rajasthan 3 4 71

OtherStates 21 11 365

Total 9 80 39 2,542

7


8/28

Sales&Service GlobalNetwork

RegionRegion PlantPlant OfficesOffices

Nort America

Europe 3 4

SouthAmerica 2 1

Australia 1

MiddleEast 2 2

ShareofRevenueShareofRevenue

FY2010FY2010 %%

India 22,188 65

Europe 4,110 12

Africa 1

Asia(excludingIndia) 2

Total 14 13

8

NorthAmerica 3,934 11

RestofWorld 3,968 12

Total 34,200 100


9/28


10/28

HumanResources..StrongR&Dfocus

Highruralethos

Over900agricultureprofessionals

FunctionalbreakupforIndiaFunctionalbreakupforIndia No.ofAssociatesNo.ofAssociates %%

Production 3,311 51

Marketing&Sales 1,685 26

DistinctiveFeaturesAsonJanuary2011

n on sm sa sen excep n aan anGeneralAdministration 1,125 18

MaterialsManagement 307 5

Total 6,428 100

Total fortheInternationalBusiness 1,100

DedicatedR&DteamforallofourbusinesslinePublicprivatepartnershipapproachfor

Research&Development

3R&DfacilitiesinIndia

Developmentofnewproductsandtechnologiesfor

o irrigationsystems energyconservation

o Pipingsystems newproducts,costeffective

advancingresearchinagriculture

MOUswithvariousuniversitiesandother

organizations

o Agroprocessing increaseyields,pestresistant

o RenewableEnergy improveoutput,newproducts

107

research

and

development

personnel

as

ofDecember31,2010

OneofthelargestpoolsofAgriculturalScientists,Engineers&

TechniciansinPrivateSectorinIndia10


11/28

SupportiveGovernmentPolicyFramework

Fourprongedstrategyforagriculturedevelopmentwithfocuson:

o agricultureproduction,

InitialoutlayofRs80billion

SubsidybyCentralGovt.totheextentof

NationalMissiononMicroIrrigationBudgetSupport

o ,

o creditsupporttofarmers&

o Thrusttofoodprocessingsector.

AllocationforAgricultureSectorincreasedtoRs147.44bn for201112.

o 50%forsmallfarmers

o Additional10%bystategovernment

Oncefullyexecuteditisexpectedtobring2.85million

DirectSubsidyonMicroIrrigationfurtherincreasedtoRs11.3bn (for201112)from10.0bn (for201011).It

wasRs.4.3bn for200910.

AllocationforRashtriya Krishi VikasYojna increasedby

Allfarmersareeligiblewithlimitof5haperbeneficiary

Assistanceavailablefor

o bothdripandsprinklersystems o s n

Financialsupportforvariousschemes:

Rs12.0bn forNationalHorticultureMission

Rs12.5bn forNationalFoodsecurityMission

o implementationofadvancedtechnologylike

fertigation withfertilizertank,sandfilters,and

otherdifferenttypesoffilterandvalvesrequired

forMIsystem

. , ,

andmaizedevelopment

Rs6.5bn formacromanagementofagriculture

Rs3.0bn forvegetableclustersnearurbancentres

Source:Nationalmissiononmicroirrigationguidelines

.

raisedto3%(from2%)forshorttermcroploans

annualeffectiverateof4%pa

11

Source:Budgetdocuments;www.indiabudget.nic.in


12/28

12


13/28

MicroIrrigation GlobalOpportunity

Bene itso MIS

MISfacilitatesincreaseinlandproductivity,

improvedsoilconditionsandsavingsonenergy,

fertilizersandwater.

Potentia inIn ia

FeasibleIrrigatedAreaFeasibleIrrigatedArea62MnHa62MnHa

Demandforagricultureequipmentswouldhave

reachedUS$88.8bn by2010globally

Indiangovernmenthastargeted17mn haby2012 AreaCoveredunderMicroIrrigationabout5.0MnHa

ImmediatePotentialforMicroIrrigation 57.0MnHa

forMIStechnology

Source:K.Iyengar andR.Lall,Status,PotentialandGovernmentEffortsforPromotingMicro

IrrigationinIndia,NationalSeminaronAdvancesinMicroIrrigation,Februrary 1516,2011Source:Koncept Analytics,MicroIrrigationSystemIndustry,FocusonIndia,

August2009

Region

(1)

NoofCountries

(2)

AvailableIrrigated

Area

(3)

Sprinkler

IrrigatedArea

(4)

DripIrrigated

Area

(5)

TotalMicro

IrrigatedArea

(6=4+5)

ProportionofAvailable

IrrigatedArea

(7=6/3)

Americas 35 41.9 13.3 1.9 15.2 36%

Europe 35 25.2 10.1 1.8 11.9 47%

Asia 46 194.0 6.8 1.8 8.6 4%

Africa 53 12.5 1.9 0.4 2.3 18%

Oceania 5 2.6 0.9 0.2 1.1 42%

WorldTotal 174 276.2 33.0 6.1 39.1 14%

13

AreainMillionHectare(Mha),Data2007

Source:Koncept Analytics,MicroIrrigationSystemIndustry,FocusonIndia,August2009


14/28

MicroIrrigation WaterManagementSolution

Applicationofwatertorootzonethroughspeciallydesignedsystem toprovideasmuchascropneeds

verage eo cro rr ga on ys em ears

14


15/28

MicroIrrigation

ProductsandServices

DripIrrigationsystems

SprinklersIrrigation systems

Precision farmin like Greenhouses and ol houses

Industry

Globallyofthetotal276.2mn hairrigatedarea,only

14%isunderMIS

In India of the total 62 mn ha irri ated area onl 5 mn

Advisory

ProductionFacilities

haisunderMIS

InIndia,governmentsupportsusageofMISinformof

subsidywhichisatleast50%ofthetotalcostforfarmer

Source:Koncept Analytics,MicroIrrigationSystemIndustry,FocusonIndia,August2009

ac t es n n a

4inUSA,2inLatinAmerica,1inIsrael,1inEurope,

1inTurkey,1inAustralia

3YearSnapshot

18,722

Farmers

Residentialusers

CommercialEnterprise

11,271

15,084

51.9%

54.2%

Application

Irrigation

Landscaping

49.2%

15

Protectedcultivation

OneofthelargestmanufacturersofMISinIndia

MicroIrrigation(Rs.Mn) %toTotalRevenue


16/28

PipingSystems

Industry

PVCpipesandfittingsachievedasalesof59,400MT

salesin2008againstacapacityof59,800MT

ProductsandServices

PVCPipesandfittings

PEPipesandfittings

TurnKe Pro ects .

Indias

demand

for

plastics

in

irrigation

alone

is

predictedtosurpass2.5mn tonnes by2015ProductionFacilities

4inIndia(samelocationsasMISbusiness) Source:Koncept Analytics,MicroIrrigationSystemIndustry,FocusonIndia,August2009,http://www.plastindia.org/default.asp

3YearSnapshot n urope

8,36128.8%

Customers

Farmers

6,599

, overnmen o es or ura wa er n ras ruc ure

ContractorsforInfrastructureprojects

Telecomcompanies

Gasdistributioncompanies

.

24.2%

FY2008 FY2009 FY2010

PrimaryApplication

Irrigation/Watertransport

Waterandseweragetransmission

16

OneoflargestproducerofpipesinIndia

PipingProducts(RsMn) %toTotalRevenue

Gasdistribution


17/28

AgroProcessing

ro uc s

Onion andvegetable dehydration

Fruitprocessing

FarmFresh,ChefWilliamandSleaford brands

n us ry

Agroprocessing hasgrown~14%andcontributes10%

ofIndiasmanufacturingGDPand13%ofIndiasexports

Indias total food market turnover is over 69.4 mn of

ProcessingFacilities

4inIndia

whichvalueaddedcontributes$22.2mn

Stillonly2%ofagricultureandfoodproduceis

processed(around43.4%ofwhichisorganised)

3YearSnapshot

1inUSAand1inUK

~60%(onion)&15%(fruit)ofsourcingisunder

contractfarming

Source:ICRAManagementConsu tingServicesLimite

Multinationalfoodcompaniesanddistributors

Beveragecompanies3,037

3,701

5,015

14.5%

Application

Ingredients for

soup,pizzatoppingsandsauces(vegetable)

13.3%

12.7%

17

icecream,juiceandbabyfood(fruits) FY2008 FY2009 FY2010

AgriProducts (RsMn) %toTotalRevenue


18/28

OtherBusinesses

RenewableEnergy

o SolarThermalwaterheaters

o Solarpoweredpumpingsystems

3YearSnapshot

o SolarPhotovoltaiclighting

TissueCultureo Bananacontributesto37%ofIndiastotalfruit

production(Source:ICRAManagementConsulting

2,957

2,4248.7%

10.2%

7.0%erv ces m e

o Companyhasacapacityof30millionplants

annuallytissuecultureinIndia(asofDec31,2010)

o Other

produce

are

Pomegranates,

Onion

and

Citrus cro s

1,996

.

PVCSheets

o 100%EOUunitforPlasticSheets

o Free foam inte ral foam ri id sheets and trim

boards

o Primarilyapplicationinsignageandbuilding

materialandindustrialusage

FY2008 FY2009 FY2010

OtherProducts (RsMn) %toTotalRevenue

Solarbusinesswill betransferredto100%

subsidiaryeffectiveJuly1,201118


19/28

19


20/28

KeyBusinessStrategies

11 ContinueourexpansionofmicroirrigationproductsinIndia

22Expandingintonewgrowthproductsandmarketsandcontinuefocus

onagriculturalvaluechain

33Focusonfinancialmanagementandsynergiesofcreatinganaffiliated

financing

entity

44 Maintainingourcostcompetitivenessthroughtechnology

55 Growththroughinvestmentsinotherventuresandmergers&

acquisitions

20


21/28

GrowthDrivers&NewInitiatives

MicroIrrigationinIndiawithfocusonstateslike

Maharastra,Karnataka,Gujarat,Rajasthan,Him

MicroIrrigationonPulses&Paddy

NewInitiativesGrowthDrivers

achalPradeshandHaryana

MicroIrrigationbusinessin

Turkey,Mexico,Africa,USAandLatinAmerica

ore ocuson o onan see sapp ca on

ContractfarmingforMango&Tomato

Processingofnewfruitslikesweetlimeand

Canalcommandareaprojectswithendtoend

solutionsthroughstategovernment

retailpackagingofmangopulp

FinancingarrangementtoFarmersforbuying

microirrigationandotherJainproductsthrough

Precisionfarmingbusinesswithfocusonvalue

addedcrops

FoodProcessingbusinessanddemandfornew

a i iateNBFC

Renewableenergyproductslikesolarwater

pumps

21


22/28

KeyDecisionsinRecentBoardMeeting

DVRBonusIssue

1DVRsharesforevery20EquityShareheld(with10%VotingRights)

11

Facilitatefuturefundraising

FurtherIssues(approvedbyshareholdersonMar9,2011)22

EquityWarrantIssuetoPromoters 6.1millionwarrants(minimumpriceRs

228.15perwarrant)

Issueof33.1mn EquitySharesincludingbywayofqualifiedinstitutional

p acemen

NonBankingFinancingCompany

Settin u ofanNBFCtocom lementtheJISLbusiness&im rovebalancesheet

33

Solar/RenewableBusiness

Totransferto100%subsidiarytofocusbusinesstofacilitategrowth

44

22


23/28

NBFCFacilitatetheMISbusiness

ProposedStructureCurrentFundingStructure

CostforFarmerCostforFarmer CostforFarmerCostforFarmer

3050%paidby

Farmer

5070%Govt.

Subsidy

5070%Loan

fromNBFC

1550%paidby

Farmer

PaidonDelivery

toJISL

CreditPeriodby

JISL/Dealer

PaidonDelivery

toJISLRepaidfromGovt.

Subsidyin612Mths

RepaidfromGovt.

BenefitforJISL BenefitforFarmer NBFCmodel

Certaintyofcostandtimingofcash Nosubsidysustainablebusiness Customerknowledgebaseand

subsidy

disbursement ImprovedCashFlows

Existingsecurisation processis

operationallyrigidandwillbe

Farmertobeartheburdenofdelay

insubsidydisbursement

phasedoutunderNBFCroute

23


24/28

24


25/28

FinancialSnapshot Consolidated

NetIncome OperatingProfit

28,707

34,397 7,002

22,529

3,843

4,541

ProfitfortheYear NetDebt*

FY2008(Restated) FY2009 FY2010 FY2008(Restated) FY2009 FY2010

1,3241,294

2,476

11,720

16,99519,395

25

FY2008(Restated) FY2009 FY2010 FY2008(Restated) FY2009 FY2010

*LoanfundslesscashandbankbalancesAllfiguresinRsMillion


26/28

MicroIrrigation SubsidyAdministration&CashToCashCycle

FarmersubmittheapplicationtoIA.IAscrutinizetheFarmersubmittheapplicationtoIA.IAscrutinizetheapplicationapplication

CollectionCycle SubsidyAdministration

vg. os (PerHa)

~US$1,000 Dealerassessthecropwaterrequirement,designtheDealerassessthecropwaterrequirement,designthesystem,preparecostestimatesystem,preparecostestimate

Subsidy50%to70%(Federal40%State10%to30%)

FarmerShare 30%to50%(CashContribution

and/orLoanfromBanks)IAexaminetheestimate&conveyitsapprovaltoDealerIAexaminetheestimate&conveyitsapprovaltoDealer

ReleasedtoFarmerbyGovt.

180360days

CollectedfromFarmer510%Advance,Balance

onInstallation

FarmerpayshisshareofcontributiontoSupplierFarmerpayshisshareofcontributiontoSupplier

SUBSIDY FederalFederal StateState DistrictRuralDistrictRural

IAreleasespaymenttotheFarmer/DealerIAreleasespaymenttotheFarmer/Dealer

DISBURSEMENT

PROCEDURE

AgricultureAgricultureDepartmentDepartment

AgricultureAgricultureDepartmentDepartment

DevelopmentDevelopmentAgencyAgency

gAgency(IA)gAgency(IA)

26Source:Nationalmissiononmicroirrigationguidelines


27/28

InvestmentHighlights

StrongBrandandLeadershipPositioninitsbusinessesinIndiaStrongBrandandLeadershipPositioninitsbusinessesinIndia

TotalSolutionProvideracrosstheAgricultureValueChainTotalSolutionProvideracrosstheAgricultureValueChain

DiverseRevenueStreamsDiverseRevenueStreams

FlexibleandScalablebusinessmodelFlexibleandScalablebusinessmodel

Wide

dealer

and

distribution

networkWide

dealer

and

distribution

network

27


28/28

28

JISL_Corporate Presentation March 2011 [Read-Only]

Documents

Transcript of JISL_Corporate Presentation March 2011 [Read-Only]