Shares of Jain Irrigation plunged 23 per cent after the rating agency India Ratings and Research downgraded its long-term debt rating.
Shares of Jain Irrigation plunged 23 per cent after the rating agency India Ratings and Research downgraded its long-term debt rating. The company’s shares are currently trading lower by 23.36 per cent at Rs 21 per share. The shares of Jal Gaon-based company had opened at Rs 25.75 per share on BSE.
India Ratings today cut its long-term debt rating to ‘IND BBB’ from ‘IND A-’. The rating agency placed Jain Irrigation on ‘Rating Watch Negative’ (RWN). Last week, the company had clarified that it had not defaulted on any of its debt obligations. Company is growth-oriented, profit making and dividend paying entity. Jain Irrigations’ total debt obligation stood at Rs 175.79 crores for FY 20, while the loans due on its overseas subsidiaries stand at USD 19.80 million for 2019-20.
Jain Irrigation will its reduce the debt by Rs 2,000 crores through corporate action and it is confident of executing on these plans, it had said in an exchange filing. It made net profits of Rs 239 crores in 2018-19 and a revenue of around Rs 8600 crores. In a BSE filing, the company said its adjusted EBITDA was approx Rs1250 crores after adjusting for one-time costs and forex/ translation costs. The company achieved this despite slowdown in rural economy, inadequate monsoon, farmer distress and food raw material price deflation and a year with the disruption caused by major state elections and general elections, it said.
As on 1st April 2019, Jain Irrigation had more than Rs 5000 crores orders in hand. It has a total of 33 manufacturing plants worldwide and 12000 associates, the company informed the exchanges. Jain Irrigation’s liquidity situation worsened in FY19 owing to delay in the realisation of receivables, the rating agency said.