JINDAL POLY

India`s largest manufacturer of BOPET & BOPP films, the stock did well yesterday and closed the day strongly in the green.  This was mainly on the back of its Board approving the demerger of its wholly-owned unit, Jindal Poly Investments and Finance Company (JPIFCL). And as per the scheme of demerger, shareholders of Jindal Poly will receive one JPIFCL share for every 4 shares held in the company and the equity shares of JPIFCL are proposed to be listed on the NSE and the BSE. The demerger, apart from creation of value, is aimed at helping the company focus on its core business.

The company’s performance for Q2FY13 was largely driven by ‘other income’. The company posted a net sales at rs.563 crore, which YoY was down 8%, operating profit at Rs.36 crore was down 63%, yet it ended the quarter with a net profit at Rs.63 crore, up 28% and a whopping almost 10 times on QoQ. This jump in net profit despite all other financial falling was thanks to the other income of Rs.22.30 crore. The company’s debt as at end of Q2FY13 stood at Rs.463 crore and cash was at Rs.67 crore. For now, the market is happy with this demerger and the prospect of having one more listed Jindal company on the bourses. Its market cap currently stands at Rs.793 crore.