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Check Before You Invest : Jain Irrigation Systems Ltd

BSE: 500219 NSE: JISLJALEQS ISIN: INE175A01038
  |   Sector:  Chemicals & Fertilizers   |   Industry:  Plastic Products

Snapshot

Q.1 Which industry/sub-sector does Jain Irrigation Systems Ltd belong to?
Jain Irrigation Systems Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Plastic Products segment.
Q.2 Is Jain Irrigation Systems Ltd a good quality company?
Jain Irrigation Systems Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Jain Irrigation Systems Ltd undervalued or overvalued?
Jain Irrigation Systems Ltd appears Somewhat Undervalued, as its key valuation ratios are lower than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 61.09 54.37
Price to Book 0.49 0.61
Price to Sales 0.71 0.87
EV to EBITDA 8.74 12.60
Q.4 Is Jain Irrigation Systems Ltd a good buy now?
Jain Irrigation Systems Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd revenue growth is -14.7% for FY-2025, which is below its 5-year CAGR of 10.22%, indicating slower growth.

Q.2 Gross Profit margin of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Gross profit margin which is the profit after deduction of direct costs, is 6% for FY-2025, which is above its 5-year median of 4.2%, indicating increasing margins.

Q.3 Operating Profit Margin of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.92% for FY-2025, which is above its 5-year median of 10.19% indicating increasing margins.

Q.4 Net Profit Margin of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Net Profit Margin is 0.76% for FY-2025, is below its 5-year median of 1.09%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 6 4.2
Operating Profit Margin (%) 13.92 10.19
Net Profit Margin (%) 0.76 1.09

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Return on Asset is 0.3%, which is below its 5-year historical median of 0.47%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Return on capital employed is 4.49% for FY-2025, which is below its 5-year historical median of 5.08%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Return on equity is 0.51% for FY-2025, which is below its 5-year historical median of 0.87%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Cash conversion cycle is 270 days, in line with its 5-year historical median of 263 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.39 0.39
ROE (%) 0.51 0.87
ROCE (%) 4.49 5.08
Cash Conversion Cycle 270 days 263 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Debt-to-Equity ratio is 0.48, which is above the industry average of 0.25, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Jain Irrigation Systems Ltd?
Jain Irrigation Systems Ltd Debt to cash flow from operations is 4.93, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Jain Irrigation Systems Ltd?

Q.1 Promoter shareholding and pledge status of Jain Irrigation Systems Ltd?
Promoters hold 26.68% of the Jain Irrigation Systems Ltd, with 40.77% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Jain Irrigation Systems Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Jain Irrigation Systems Ltd vs industry peers?
Jain Irrigation Systems Ltd revenue CAGR is 10.22%, compared to the industry median CAGR of 4.71%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -14.7 4.7
Gross Profit Growth (%) -14 14.3
Operating Profit Growth (%) -9.7 10.1
Net Profit Growth (%) -55.4 18.7
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.39 1.06
ROE (%) 0.51 5.91
ROCE (%) 4.49 8.75
Cash Conversion Cycle (days) 270.1 77

Valuation & price assessment

Q.1 Stock return of Jain Irrigation Systems Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of -6.3% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
-6.3% 12.7% -4.6% -28.4%
Q.2 Valuation ratios of Jain Irrigation Systems Ltd vs historical?
The current P/E ratio of 61.09 is higher than its historical median of 54.37, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 61.09 54.37 22.05
Price to Book 0.49 0.61 1.89
Price to Sales 0.71 0.87 1.33
EV to EBITDA 8.74 12.60 10.86

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