Naandan Jain plans to take up large agriculture projects

Mumbai: Israeli-based Naandan Jain Irrigation has seen its net profits grow 563 per cent in the nine month period ending September 30, 2007, said Mr Amiel Sadeh, Joint Chairman of the company, at a press conference here.

Jain Irrigation Systems holds a little over 50 per cent stake in the company, acquired in June 2007 for $21.5 million.

Net profit grew to $3.08 million from $0.54 million in the same period last year. Profits to the tune of 50.001 per cent holding in Naandan Jain would reflect in the books of the Indian company possibly a quarter later, said Mr Anil Jain, Co Chairman of the company. The company’s profit grew on the strength of volume growth as well as price revision. Sales grew by 24 per cent to $68.62 million from $54.88 million during this period. Geographically the highest growth rate of 300 per cent was reported in India, the company release said.

One of the immediate synergies of the acquisition is the import of Naandan Jain products into India and exports of Jain Irrigation products through Naandan’s nine subsidiaries and distributors across 70 countries, said Mr Sadeh.

Immediate impact of this will be a growth in sales of Jain Irrigation by $10 million to $15 million in the next fiscal, said Mr Jain.

The company which specialises in targeted irrigation distribution solutions said that increasing irrigation activity in sugarcane fields across the sugar cultivating economies, thanks to the demand for ethanol production, can be a big market.

The company also plans to take up larger agricultural projects that either of the partners could not do individually, as the projects were in the range of $5 million to $10 million, said Mr Jain.

Mr Jain said agriculture and industry accessories like valves, filters, and controllers have remained out of Jain Irrigation portfolio and could be targets for future acquisitions.

Jain Irrigation, which also holds 51 per cent in US-based NuCedar Mills Inc, will acquire part of the 49 per cent in the current fiscal, said Mr Jain.

In the last 12 months, Jain Irrigation acquired three US-based irrigation companies – Chapin Watermatics Inc, Aquarius Brands Inc and world’s third largest onion dehydrator Cascade Specialties, Inc.

Jain Irrigation currently ranked No. 2 in the world for irrigations systems, said Mr Jain. The company’s scrip closed at Rs. 647.90 on Monday at the BSE up 3.85 per cent from Friday’s close.