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| Edited By: Anurag Shah |Source: DNA |Updated: Mar 19, 2018, 06:49 AM IST
What is your outlook for this quarter, given certain negative sentiments in the market about your company?
The sentimental issue that you have referred to is just a structural issue. It is because of the sentiment that the overall debt is very high. We have already made provisions for debt reduction and we are making attempts towards achieving full debt reduction. In December, we had talked about reducing our debts in March quarter by Rs 250-300 crore. That process is on. Once the debt reduction is done, we are sure there will be changes in market sentiment and people will gain further confidence in the company. Due to untimely rain and hailstorms since last September, the underlined demand in rural areas and investment capacity of the farmers had fallen drastically. Due to such a situation, demand is a little subdued. But we are counter-balancing by increasing exports this fiscal. This way, by increasing exports while dealing with negative sentiments in rural areas, we will bring in positive growth in our business.
JISL has always been focusing on micro-irrigation. What is the present scenario in this segment?
There is definitely a concern in this area. Our company has been working for the small farmers who have been going through rough patches due to climate change and extreme weather events, which cannot be controlled by government or farmers. These events have caused much damage already. But there are a few long-term structural solutions in this, like getting risk mitigation insurance properly handled, and hiking allocations in Prime Minister's National Irrigation Scheme, which was launched recently, as the current allocation is not enough. By raising allocations, the permanent structural problems like water woes can be solved. Drip irrigation process should be used to handle water woes, and then, the long-term issues can be solved in favour of farmers.
What is your outlook on micro irrigation? Also, are you planning to make foray in any new sector?
If you see our revenue break-up, about 50% comes from the micro-irrigation business, 22% from food processing, and 22% comes from the piping business. Rest of our businesses contribute remaining 5% to 10% of the revenue. We have recorded positive growth in micro irrigation in the last fiscal, and during the current fiscal, we expect positive growth in this segment for sure. Piping business, which did not look good in the initial nine months of the last year, bounced back in the last three months due to a lot of activities in the infrastructure sector. In the first nine months, food processing business had shown 25% growth, and we can see positive growth in all the three major business areas. Talking about solar pumps, there are various positive policies coming from various state government agencies due to power scarcity for farmers. Solar water pumps can solve all these issues. We feel that structural policy of government should come now.
How is the order book looking like? Also, how much debt are you planning to reduce this fiscal?
Order book right now is pegged at around Rs 1,000 crore, and we keep getting repeat orders. Dealers keep giving us repeat orders. We can see a positive growth in our order book position too. Secondly, we are already reducing the debt burden. In the last quarter's result vis-a-vis December quarter, you will see a significant debt reduction. We have also decided to further reduce debt this fiscal, and we have shareholders' equity of around Rs 2,300 crore, and in last December our debt on standalone balance sheet was around Rs 3,100-3,200 crore. We wish to bring in debt and equity on a 1 to 1 level this year. We expect equity to rise and debt to reduce. We hope for improvement in bottomline of the company.
