Jain Irrigation gains on overseas acquisition

Jain Irrigation Systems surged 3.93% to Rs 745 at 14:23 IST on BSE on acquiring 69.75% stake in Thomas Machines S.A. of Switzerland with full management and operational control.

The company made this announcement during trading hours today, 3 March 2008.

Meanwhile, BSE Sensex was down 592.99 points or 3.37% to 16,985.73, as Asian stocks fell sharply amid growing concerns about the global impact of a US slowdown.

On BSE, 53,180 shares were traded in the counter. The scrip had an average daily volume of 53,575 shares in the past one quarter.

The stock hit a high of Rs 745.90 and a low of Rs 681.25 so far during the day. The stock had a 52-week high of Rs 765.95 on 4 December 2007 and a 52-week low of Rs 400 on 5 March 2007.

The mid-cap scrip had outperformed the market over the past one month till 29 February 2008, gaining 14.92% compared to the Sensex’s decline of 0.40%. It had also outperformed the market in the past one quarter, rising 15.78% compared to Sensex’s decline of 9.22%.

The company’s current equity is Rs 68.07 crore. Face value per share is Rs 10.

The current price of Rs 745 discounts its Q3 December 2007 annualized EPS of Rs 26.52, by a PE multiple of 28.09.

Thomas Machines S.A. (THE) is a manufacturer of specialist machines and equipment, including drip irrigation lines, quality control and test equipment, automation equipment, laser machine centres and laser products. It holds valuable intellectual property rights (IPRs) and cutting edge technology for its business in both irrigation and composite pipes business.

The acquisition will help the Jain Irrigation Systems (JISL) and its subsidiaries all over the world to further invest in the field of irrigation to build its capacities and increase speed to market for new generation drip lines.

On 13 February 2008, JISL signed a memorandum of understanding with Mekorot, Israel for exploring potential projects in India.

JISL’s net profit rose 43.3% to Rs 44.85 crore on 36.2% growth in net sales to Rs 411.72 in Q3 December 2007 over Q3 December 2006.

Jain Irrigation Systems manufactures plastic pipes, micro-irrigation systems, plastic sheets, high-tech agriculture, processed fruits and vegetables.