Jaiprakash Associates Ltd
Construction & Engineering
FV – Rs 2; 52wks H/L – 29.65/6.1; TTQ – 65 Lacs; CMP – Rs 27 (As On July 25, 2017);                      

            Market Cap – Rs 6665 Crs

Consolidated Financials and Valuations for FY17 (Amt in Rs Crs unless specified)

Equity Capital	Net worth	Long Term Debt	Total Sales	PAT	BV (Rs)	EPS (Rs)	P/E	Industry P/E	P/BV	Promoter’s Stake	Beta
486.49	3810	26640	14260	-9413	19	-38.7	–	19.74	1.7	39.28	–

 

Consolidated Financials and Valuations for FY16

Equity Capital	Net worth	Long Term Debt	Total Sales	PAT	BV (Rs)	EPS (Rs)	P/E	Industry P/E	P/BV	Promoter’s Stake	Beta
486.49	13084	53379	17407	-3345	54	-13.8	–	19.74	0.5	39.34	–

 

Valuation Parameters:

1. Long Term Debt to Equity – 7
2. ROE % – NA
3. Market Cap/Sales – 0.5

The Company has an an order book of over Rs 10,000 crore and E&C business shows good prospects looking at India’s requirement of infrastructure. The Company will also be participating in irrigation, tunnels, hydro and metro projects and has the needed capacity to grow the EPC business and will endeavour to reach revenue of around Rs 6000 Crs by FY20 from this stream. http://economictimes.indiatimes.com/markets/expert-view/jaiprakash-associates-aims-to-be-debt-light-even-zero-debt-manoj-gaur/articleshow/59483511.cms

 The Company has executed an agreement with Orient Cement Ltd for acquisition of Company’s 74% equity stake in Bhilai Jaypee Cement based on Enterprise Value of Rs.1450 Crs on cash free and Debt free basis. http://www.bseindia.com/xml-data/corpfiling/AttachHis/7c582ce7-a0c2-428e-bfaf-7714dc18de61.pdf

The Company has received Letter of Award from M/s National Highway Authority of India for the work of Four Laning of Biju Para – Kuru Section of NH-75 in the State of Jharkhand and the Contract Price is Rs. 144.1 Crs.

The Company along with its subsidiaries is the third largest cement producer in the country with 32.85 MTPA operative capacity.

Rs. 6960 Crs are in Projects under Development as per 31^st March 2016

Restructuring:

The restructuring would involve division of the nearly Rs 30000 Crs debt into three parts. The first portion of about Rs 10000 Crs debt would be moved off the company’s balance sheet as it sells a significant portion of its cement businesses to UltraTech Cement Ltd. About Rs 13000 Crs worth land holdings of the company would be carved out as a special purpose vehicle under the control of the lenders and subjected to a long-term repayment schedule through sale of these properties.

The remaining debt would continue on the company’s books, representing the indebtedness of the remaining sustainable businesses. These would include the company’s residual cement business, engineering procurement and construction (EPC) business, five luxury hotels, power plants, a hospital and a sports business.

https://www.bloombergquint.com/business/2017/06/27/jaiprakash-associates-lenders-icici-bank-restructure-debt-three-parts

Overview:

• Jaiprakash Associates Limited is a diversified infrastructure company.
• The Company’s principal business activities include engineering, construction and real estate development, and manufacture of cement.
• Its segments include Construction, which includes civil engineering construction/engineering, procurement and construction (EPC) contracts/expressway; Cement, which includes manufacture and sale of cement and clinker; Hotel/Hospitality, which includes hotels, golf course, resorts and spa; Sports Events, which includes sports-related events; Real Estate, which includes real estate development; Power, which includes generation and sale of energy; Investments, which includes investments in subsidiaries and joint ventures for cement, power, expressway and sports, among others, and Others, which includes coal, waste treatment plant, heavy engineering works, hitech castings and man power supply, among others.
• It has operations in Haryana, Madhya Pradesh, Gujarat and Jharkhand, among others.
• The Company has 21 Subsidiaries engaged in different business activities.

Management:

• Manoj Gaur – CEO
• Rahul Kumar – CFO

Divestment Initiatives:

1. Sale of  Cement Plants in Gujarat by JCCL (Rs.3800 Crs)
2. Sale of stake in Bokaro Jaypee Cement Ltd (Rs. 668 Crs)
3. Sale of Cement Grinding Unit of the Company at Panipat, Haryana (Rs. 360 Crs)
4. Sale of Baspa – II by JVPL (Rs. 9700 Crs)
5. Sale of wind Power plants of 49 MW of the Company (Rs. 161 Crs)
6. Sale of Cement Plants (Rs. 16189 Crs)

 

The Equity Capital is @ Rs 486.49 Crs consisting of 2432456975 equity Shares of FV Rs 2 currently held 

19.96% Of the Promoter’s Holding is pledged.

Major Non – Promoter Holdings:

Non – Promoters	No. of Shares held	% of Shares held
Orbis Sicav	110906583	4.56
Orbis Global Equity Fund	35389474	1.45
Societe Generale	27357474	1.12
Life Insurance Corporation of India	108934905	4.48
Rakesh Jhunjhnwala	25000000	1.03

 

 

Non – Current Investments: (Equity – Quoted fully paid up)

Name	No. of shares	Rs. In Lacs
Capital Trust Ltd	15350	2
Indian Overseas Bank	721600	72
PNB Gilts Ltd	221200	50
TFCI	25000	5
Total		129

 

Segmented Results:

Particulars	31-03-2017	31-03-2016
Segment Revenue:
Cement & Cement Products	5217	7042
Construction	1445	2196
Power	4283	4382
Hotels/Hospitality & Golf Course	239	238
Sports Events	18	21
Real Estate	–	–
Investments	1013	2951
Infrastructure	2186	2417
Fertilizers	197	87
Health Care	71	138
Others Unallocated	4	1
Segment Results:
Cement & Cement Products	-384	-83
Construction	-357	109
Power	902	2034
Hotels/Hospitality & Golf Course	9	7
Sports Events	-139	-186
Real Estate	-43	184
Investments	2	-1
Infrastructure	-289	978
Fertilizers	188	168
Health Care	-87	-32
Others Unallocated	-30	-40

 

Snapshot of Prices :

Year	Open (Rs.)	High (Rs.)	Low (Rs.)	Close (Rs.)
2004	117	195.1	73.45	189.95
2005	186	404	170	388.8
2006	388	740	280	726.4
2007	728.45	2,177.00	370.1	426.05
2008	430	510	47.05	83
2009*	84	270	60.05	146.9
2010	148	167.8	98.2	105.9
2011	107	110.55	51.25	52.4
2012	52.8	106.75	50.45	97
2013	97.9	102.55	28.4	54.5
2014	54.75	89.85	23.05	25.1
2015	25.1	29.45	7.95	11.46
2016	12.05	13.39	5.3	8.07
2017	8.05	29.65	7.9	27.75

• Bonus Issue 1:2

 

Consolidated Financial Trends (In Rs. Crs) :

Particulars	FY17	FY16	FY15	FY14	FY13	FY12	FY11
Equity Paid Up	486.49	486.49	486.49	443.82	443.82	425.29	425.29
Networth	3810	13084	1496	10270	12553	11478	10779
Total Debt	30190	58250	61285	61101	55678	45371	41171
Net Sales	14260	17407	19812	19976	19129	15120	11630
Other Income	174	86	146	142	158	247	255
PAT	-9413	-3345	-1735	-824.84	461.79	632.92	1792.82
Book Value (Rs)	16	54	6	46	57	54	51
EPS (Rs)	-38.7	-13.8	-7.1	-3.7	2.1	3.0	8.4

 

The finance cost aggregating Rs.3679 Crs and high provision for depreciation of Rs.912 Crs were the two major factors leading to poor operating results of the Company.

Liabilities Directly Associated with Assets in Disposal Group Classified as held for Sale amounts to be Rs. 2031 Crs.