Jain Irrigation Systems (500219) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 was weak, with consolidated revenue at ₹11,920 million, down 12.5% year-over-year, and earnings below expectations due to excessive rains impacting domestic agriculture demand.

• Overseas subsidiaries, especially food processing and plastic sheets, performed well, partially offsetting domestic weakness.

• PAT turned negative in Q2FY25 at -₹132 million; management remains optimistic for H2FY25, expecting demand revival from increased sowing and new product initiatives.

• Unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2024, were approved by the Board on October 28, 2024.

Financial highlights

• Q2 revenue was approximately INR 1,200 crore (₹11,920 million), with EBITDA just under INR 140 crore (₹1,387 million); H1 revenue reached INR 2,674 crore (₹26,698 million) and EBITDA INR 318 crore (₹3,175 million).

• Standalone revenue for Q2 FY25 was ₹57,505 lakhs, down from ₹80,454 lakhs in Q2 FY24; consolidated revenue was ₹1,19,197 lakhs, down from ₹1,36,192 lakhs.

• Net cash from operating activities for H1 was INR 340 crore, up from INR 303 crore YoY; standalone Q2 operating cash flow was INR 198 crore.

• Debt reduced by INR 57 crore during the quarter; maintenance CapEx for H1 was INR 94 crore, similar to last year.

• Export revenue for H1 grew 29% YoY to INR 188 crore; plastic sheet business overseas grew 15% in H1.

Outlook and guidance

• To meet annual targets, 67%-68% of revenue must be achieved in H2; original revenue guidance of INR 7,000 crore may be revised to 7%-8% growth instead of 10%-12%.

• Management expects demand boost in H2FY25 from increased sowing, improved rainfall, and new product launches.

• Focus on deleveraging, cash flow optimization, and growth in MIS, Pipes, Tissue Culture, Solar Pumps, and international supplies.

• Export growth target for the year is 28%-30%, with a long-term goal to double exports to INR 1,000 crore in 3-4 years.