NSE News - Latest Corporate Announcements

Wednesday, February 22, 2012

Tata Communications to sell employee residential property (not part of land bank)

Tata Communications, formerly known as Videsh Sanchar Nigam Ltd, has sought Government approval for selling residential property in Kochi and Bangalore in a bid to cash out its unutilised assets.
The company, in which the Government owns minority stake, wants to sell 24 residential properties in the two cities.
The housing units were built when VSNL was still owned by the Government for its employees. According to Government sources, the Tata Communications wants to sell off the properties because the current employees do not want to stay in these units.
This comes even as the Government has undertaken a process to hive off the 770 acres of surplus land belonging to the erstwhile Videsh Sanchar Nigam Ltd into a new company.
The residential property put on the block by the company is not part of the surplus land. The company has to take Government approval under the shareholders' agreement. Government officials said the Department of Telecom is likely to agree with the proposal as the company does not see any use for the flats. The DoT had earlier in 2008 agreed to a similar proposal from the company to sell 30 residential units in and around Mumbai.

Monday, February 20, 2012

Jayant Agro Organics: CRISIL Upgrades credit rating for Jayant Agro Organics

CRISIL has upgraded its ratings on the bank facilities of Jayant Agro-Organics Ltd. (JAOL; part of the Jayant group) to ‘CRISIL BBB/Stable/CRISIL A3+’ from ‘CRISIL BBB-/Stable/CRISIL A3’.

The upgrade reflects more-than-expected improvement in the Jayant group’s financial risk profile, driven by sizeable cash accruals, in 2010-11 (refers to financial year, April 1 to March 31). The group reported a significant growth in revenues for 2010-11 and for the first half of 2011-12 and has maintained its operating profitability over the past five years leading to healthy cash accruals and accretion to reserves. The group’s revenues increased by 30 per cent year-on-year in 2010-11 and by 65 per cent in the first half of 2011-12 over that in the first half of 2010-11. Its turnover is expected to increase at a healthy rate over the medium term, driven by healthy global demand, increase in castor seed prices and the group’s position as the largest organised player in the castor oil industry. The upgrade also factors in expected improvement in the group’s operating profitability because of commencement of operations at group company Ihsedu Speciality Chemicals Pvt Ltd (ISCPL) in December 2011.
The ratings continue to reflect the Jayant group’s leadership position in castor oil and castor-oil-based derivatives business, supported by its promoters’ longstanding industry experience, and the group’s healthy operational efficiencies, aided by its integrated operations and healthy working capital management. These rating strengths are partially offset by the group’s moderate financial risk profile, marked by modest operating margins, volatile working capital requirements, high gearing and susceptibility to risks related to stabilisation of operations at ISCPL.
To arrive at its ratings, CRISIL has combined the business and financial risk profiles of JAOL, and JAOL’s wholly owned subsidiaries, Ihsedu Agrochem Pvt Ltd (IAPL), Ihsedu CoreAgri Services Pvt Ltd (ICSPL), and ISCPL, and Ihsedu Itoh Green Chemicals Marketing Pvt Ltd (IIGCMPL; JAOL’s joint venture with Itoh Oil Chemicals co Limited. The entities are collectively referred to as the Jayant group. All the group entities have significant operational and financial linkages with each other. JAOL has provided corporate guarantees for the bank facilities of ISCPL and IAPL.
Outlook: Stable 
CRISIL believes that the Jayant group will maintain its healthy market position in the castor oil and castor-oil-based derivatives business over the medium term, supported by expected stabilisation of operations at ISCPL. The outlook may be revised to ‘Positive’ if the group demonstrates a track record of stable operations at its sebacic acid plant coupled with a significant improvement in its capital structure over the medium term. Conversely, the outlook may be revised to ‘Negative’ if the group undertakes a larger-than-expected debt-funded capital expenditure (capex) programme or if its working capital requirements increase beyond expectations, thereby adversely impacting its capital structure.
About the Group 
Set up in 1992, JAOL manufactures castor oil and castor-oil-based derivative products. Its promoters have been in the castor oil business since 1952, when they set up Jayant Oil Mills. Following the separation of the Kapadia and Udeshi promoter families, in 2002, the Udeshi family started running the business under JAOL.
IAPL was set up as a backward integration initiative into seed-crushing in 2001-02. It has a seed crushing capacity of 360,000 tonnes per annum (tpa) and cake crushing capacity of 210,000 tpa.
ISCPL was set up in 2006 as a joint venture of JAOL and Mitsui & Co. Ltd, Japan. In August 2011, JAOL bought all the shares of ISCPL, making it a wholly owned subsidiary. ISCPL is engaged in manufacture of sebacic acid, a castor-oil-based derivative, and has commenced commercial production in December 2011.
ICSPL was set up to manufacture hybrid seeds. It has generated revenues of Rs.20 million in 2011-12.
IIGCMPL was incorporated in 2010-11, with JAOL holding 90 per cent equity stake, which has now reduced to 60 per cent. IIGCMPL has not begun operations yet.
The Jayant group reported a profit after tax (PAT) of Rs.249.2 million on net sales of Rs.12.56 billion for 2010-11, against a PAT of Rs.124.6 million on net sales of Rs.9.03 billion for 2009-10.

Image of the rating report:

Jayant Agro Organics: Promoters buy 5.6 lakh shares from Open Market worth 6.5Cr

Jayant Agro Orgamics
Current Market Price: 107.20.
Market Cap: 160cr
Sales 9 months ending Dec 2011: 1372.93cr
PBDIT 9 months ending Dec 2011: 69.34cr
Taxes 9 months ending Dec 2011: 12.24cr
Net Profit 9 months ended Dec 2011: 25.11cr
EPS 9 months ended Dec 2011: 16.74

Promoters of Jayant Agro Organics as per disclosure norms set by SEBI have bought from the Open market (Public) 5,60,346 shares from the open market.

Total Cost of acquisition of 5.6 lakh shares is Rs 6.5Cr Avg price per share is: 116.27

Other interesting fact is .. all these shares were bought from one broker as intermediary: 
Ved Brothers Securities Pvt Limited.

In Dec 2011  Results for 9 months:

Taxes Paid 9 months ending Dec 2011: 12.24Cr
Taxes Paid year ending March 2011: 10.63Cr

Net Profit 9 months ending Dec 2011: 25.11Cr
Net Profit year ending March 2011: 24.57Cr

So looks like profits have been kept suppressed and ideally we should have seen around 28.28Cr as net profit  for 9 months ending Dec 2011(considering 30.21% income tax rate of March 2011)

Conclusion: In past 24 days 5.6 lakh shares have been bought by promoters spending 6.5Cr in cash at an avg share price of 116.27. Tax payments are also high. Sebacic Acid derivatives plant has also started commercial production. 
Castor oil and its derivatives are used in toothbrush bristles, medical disposables like feeding tubes, IV fluid, deodorant, shaving cream, aftershave,soap shampoo, perfumes, cosmetics, Textile dyes, Bread, chocolate, icecream, autoparts, lubricants, engine coolants, fuel additives, marine paints, engineering plastics, pencil, writing inks, paper, crayons, mobiles, laptop, telecommunications and furniture 
Things have started to move and going forward ..we could see sharp price increases. Strong Buy!!