Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

High Yield Experts

Senior Credit Analyst, Lucror Analytics

Trung Nguyen

Senior Credit Analyst

Credit

We view Jain Irrigation as “High Risk” on the LARA scale, mainly due to the company's high leverage and the challenging industry. We like its diversified and integrated operations, as well as Jain's dominant positions in its various segments. While the company enjoys pricing power, the business depends greatly on government subsidies, which are declining. In addition, the subsidies have led to poor working-capital management, due to the long time taken for the authorities to make payment (12-18 months). We note Jain’s questionable capital-allocation discipline (following a series of acquisitions) and management’s excessive optimism, which at times is not in line with the eventual business performance. OCF has been weak owing to high interest costs, leaving limited FCF for deleveraging. We believe the key risk stems from the regulatory environment, in particular with respect to subsidies for farmers. Our fundamental Credit Bias on Jain is “Stable”. The company expects further improvement in FY 2018-19, and the recent performance has been better than projected. That said, poor disclosure and the opaque business raise the risk of sudden negative developments. We view the group as “Weak” on the LAGA scale, given: [1] that the Jains dominate the Board, with only one ED who is not a member of the family; [2] the poor disclosure of information; [3] overly optimistic management; [4] the previous default; and [5] related-party transactions.

   We view Jain Irrigation as “High Risk” on the LARA scale, mainly due to the company's high leverage and the challenging industry. We like its diversified and integrated operations, as well as Jain's dominant positions in its various segments. While the company enjoys pricing power, the business depends greatly on government subsidies, which are declining. In addition, the subsidies have led to poor working-capital management, due to the long time taken for the authorities to make payment (12-18 months).    We note Jain’s questionable capital-allocation discipline (following a series of acquisitions) and management’s excessive optimism, which at times is not in line with the eventual business performance. OCF has been weak owing to high interest costs, leaving limited FCF for deleveraging. We believe the key risk stems from the regulatory environment, in particular with respect to subsidies for farmers.    Our fundamental Credit Bias on Jain is “Stable”. The company expects further improvement in FY 2018-19, and the recent performance has been better than projected. That said, poor disclosure and the opaque business raise the risk of sudden negative developments.    We view the group as “Weak” on the LAGA scale, given: [1] that the Jains dominate the Board, with only one ED who is not a member of the family; [2] the poor disclosure of information; [3] overly optimistic management; [4] the previous default; and [5] related-party transactions. 

Jain Irrigation - Tear Sheet - Lucror Analytics

Jain Irrigation Systems

Jain Irrigation - Tear Sheet - Lucror Analytics