Looking for a profitable fast-growing stock? Look at Century Sunshine Group Holdings Ltd
25/03/2015 • About Century Sunshine Group Holdings Ltd (
$509) • By InTwits
Century Sunshine Group Holdings Ltd is a growth stock in Chemicals industry. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Century Sunshine Group Holdings Ltd showed fast growth in the last financial year. Century Sunshine Group Holdings Ltd's revenue surged on 26.4% in FY2014. EBITDA also increased considerably: 24.4% for the same period.
In the longer period Century Sunshine Group Holdings Ltd showed fast revenue growth of 41.2% from 2011 to 2014 annualy. EBITDA surged on 71.3% from 2011 to 2014 annualy.
Century Sunshine Group Holdings Ltd ($509) financials for the last 5 years
| mln. HKD | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 494 | 737 | 1,243 | 1,640 | 2,073 |
|---|
| Revenue growth, % | | 49.2% | 68.7% | 32.0% | 26.4% |
|---|
| Gross margin, % | 18.2% | 17.9% | 26.7% | 31.0% | 31.8% |
|---|
| SG&A, % | | 10.1% | 7.81% | 7.63% | 8.03% |
|---|
| EBITDA | 65 | 114 | 300 | 460 | 573 |
|---|
| EBITDA growth, % | | 76.5% | 163.5% | 53.3% | 24.4% |
|---|
| EBITDA margin, % | 13.1% | 15.5% | 24.2% | 28.1% | 27.6% |
|---|
| Net Income | 73 | 97 | 130 | 230 | 288 |
|---|
| Net Income margin, % | 14.7% | 13.1% | 10.5% | 14.0% | 13.9% |
|---|
| |
| CAPEX | 52 | 83 | 375 | 357 | 585 |
|---|
| CAPEX/Revenue, % | 10.6% | 11.3% | 30.2% | 21.8% | 28.2% |
|---|
| Debt | 173 | 284 | 317 | 316 | 890 |
|---|
| Cash | 201 | 241 | 391 | 382 | 829 |
|---|
| Net Debt/EBITDA | -0.4x | 0.4x | -0.2x | -0.1x | 0.1x |
|---|
| |
| ROIC, % | 1.6% | 3.5% | 11.3% | 15.9% | 16.4% |
|---|
| ROE, % | 6.3% | 7.3% | 8.6% | 12.7% | 13.7% |
|---|
Profitability and return on investment
EBITDA margin declined slightly from 28.1% in FY2013 to 27.6% in FY2014. If we look for the longer period EBITDA margin surged on 12.1 pp from 15.5% in 2011 to 27.6% in 2014.
Century Sunshine Group Holdings Ltd shows attractive ROIC at 16.4% for the last 12 months which assumes stable development model. During the last three years it surged - it was 3.54% in FY2011. For the last three years the average ROIC was 14.5%.
Century Sunshine Group Holdings Ltd showed small Net Income margin decline of 0.100 pp from 14% to 13.9% in 2014. If we look for the longer period Century Sunshine Group Holdings Ltd's Net Income margin increased on 0.800 pp from 13.1% in 2011 to 13.9% in 2014.
Century Sunshine Group Holdings Ltd operates at ROE of 13.7%. Average ROE for the last three years was 11.7%.
Capital expenditures (CAPEX)
To this fast growth the company had to invest in CAPEX.Century Sunshine Group Holdings Ltd's CAPEX/Revenue was 28.2% in FY2014. Century Sunshine Group Holdings Ltd showed fast CAPEX/Revenue growth of 16.9 pp from 11.3% in 2011 to 28.2% in 2014. It's average level of CAPEX/Revenue for the last three years was 26.7%.
Leverage (Debt)
The company has low debt level at 0.1x Net Debt/EBITDA - at the same time with high growth. In the last 3 years Century Sunshine Group Holdings Ltd's leverage dropped on 0.27x from 0.38x in 2011 to 0.11x in 2014.
Valuation vs. comparable companies
At the end of trading day today Century Sunshine Group Holdings Ltd traded at 3.4x EV/EBITDA which is 81.2% lower than 18.3x Chemicals peer group avearge calculated on the basis of 70 companies. The company trades at 6.6x P/E which is 47% lower than 12.5x Chemicals industry avearge calculated based on 11 companies.
Peers in Chemicals
Below we provide Century Sunshine Group Holdings Ltd benchmarking against other companies in Chemicals industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Bestway International Holdings Ltd ($718) | | -86.9% | -25.4% | -62.1% | 330.3% |
| Huabao International Holdings Ltd ($336) | | 20.5% | 16.1% | 10.1% | 16.2% |
| Yingde Gases Group Co Ltd ($2168) | | 41.1% | 16.9% | 38.5% | 12.4% |
| Dongyue Group Ltd ($189) | | 70.4% | -30.6% | -3.8% | 12.0% |
| Infinity Chemical Holdings Co Ltd ($640) | | 26.2% | 7.9% | 12.3% | 10.3% |
| |
|---|
| Median (12 companies) | | 23.4% | 3.7% | 10.6% | 4.5% |
|---|
| Century Sunshine Group Holdings Ltd ($509) | | 49.2% | 68.7% | 32.0% | 26.4% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Huabao International Holdings Ltd ($336) | 75.5% | 74.3% | 70.5% | 69.1% | 70.8% |
| Bracell Ltd ($1768) | 49.5% | 40.1% | 30.5% | 37.3% | 37.3% |
| Yingde Gases Group Co Ltd ($2168) | 38.7% | 34.2% | 31.7% | 31.0% | 32.1% |
| Infinity Chemical Holdings Co Ltd ($640) | 25.7% | 22.0% | 25.4% | 28.0% | 29.8% |
| Changmao Biochemical Engineering Co Ltd ($954) | 26.6% | 18.4% | 19.5% | 24.0% | 19.8% |
| |
|---|
| Median (12 companies) | 24.8% | 20.3% | 21.7% | 16.2% | 15.4% |
|---|
| Century Sunshine Group Holdings Ltd ($509) | 18.2% | 17.9% | 26.7% | 31.0% | 31.8% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Huabao International Holdings Ltd ($336) | 66.5% | 66.4% | 63.8% | 59.1% | 60.0% |
| Bracell Ltd ($1768) | 47.5% | 30.1% | 22.3% | 30.8% | 38.2% |
| Yingde Gases Group Co Ltd ($2168) | 31.5% | 32.3% | 29.4% | 29.8% | 32.3% |
| Dongyue Group Ltd ($189) | 27.3% | 37.3% | 23.6% | 16.5% | 17.8% |
| Kingboard Chemical Holdings Ltd ($148) | 21.2% | 15.2% | 13.2% | 16.9% | 15.7% |
| |
|---|
| Median (12 companies) | 23.1% | 17.4% | 14.5% | 15.9% | 11.5% |
|---|
| Century Sunshine Group Holdings Ltd ($509) | 13.1% | 15.5% | 24.2% | 28.1% | 27.6% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| China Zenith Chemical Group Ltd ($362) | 48.7% | 36.8% | 147.3% | 55.7% | 67.4% |
| Bracell Ltd ($1768) | 11.5% | 24.4% | 22.3% | 64.3% | 35.4% |
| Yingde Gases Group Co Ltd ($2168) | 64.2% | 51.4% | 76.3% | 39.2% | 26.1% |
| Changmao Biochemical Engineering Co Ltd ($954) | 0.6% | 8.3% | 6.4% | 8.3% | 11.6% |
| Dongyue Group Ltd ($189) | 13.8% | 8.7% | 9.6% | 10.8% | 8.4% |
| |
|---|
| Median (12 companies) | 7.2% | 8.3% | 8.0% | 8.8% | 4.5% |
|---|
| Century Sunshine Group Holdings Ltd ($509) | 10.6% | 11.3% | 30.2% | 21.8% | 28.2% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Huabao International Holdings Ltd ($336) | 41.3% | 34.6% | 28.7% | 25.2% | 26.2% |
| Yingde Gases Group Co Ltd ($2168) | 13.5% | 14.7% | 10.6% | 11.5% | 11.5% |
| Infinity Chemical Holdings Co Ltd ($640) | 21.4% | 9.2% | 11.1% | 10.2% | 8.8% |
| Dongyue Group Ltd ($189) | 23.2% | 49.8% | 15.0% | 7.4% | 7.8% |
| Changmao Biochemical Engineering Co Ltd ($954) | 15.4% | 10.9% | 10.8% | 13.9% | 7.1% |
| |
|---|
| Median (12 companies) | 16.0% | 8.5% | 9.1% | 7.1% | 5.0% |
|---|
| Century Sunshine Group Holdings Ltd ($509) | 1.6% | 3.5% | 11.3% | 15.9% | 16.4% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 0.5x | 2.4x | 2.2x | 4.6x | 18.1x |
| Ngai Hing Hong Co Ltd ($1047) | 2.8x | 4.8x | 11.7x | 5.3x | 5.4x |
| Yip's Chemical Holdings Ltd ($408) | 0.7x | 4.5x | 2.8x | 2.7x | 3.8x |
| Yingde Gases Group Co Ltd ($2168) | 1.0x | 1.7x | 4.0x | 3.7x | 3.7x |
| Kingboard Chemical Holdings Ltd ($148) | 1.0x | 2.5x | 2.8x | 2.9x | 3.1x |
| |
|---|
| Median (10 companies) | 0.7x | 1.7x | 2.0x | 2.8x | 2.3x |
|---|
| Century Sunshine Group Holdings Ltd ($509) | -0.4x | 0.4x | -0.2x | -0.1x | 0.1x |
