Eye on Zhuzhou CSR Times Electric Co Ltd with its long history of healthy growth
27/03/2015 • About Zhuzhou CSR Times Electric Co Ltd (
$3898) • By InTwits
Zhuzhou CSR Times Electric Co Ltd is a growth stock in Miscellaneous Manufactur industry. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Zhuzhou CSR Times Electric Co Ltd showed growth in the last financial year. The company's revenue surged on 43.2% in FY2014. Together with revenue growth Zhuzhou CSR Times Electric Co Ltd also managed to keep EBITDA growth. EBITDA grew 49.3% for the same period.
In the longer period Zhuzhou CSR Times Electric Co Ltd showed fast revenue growth of 21.1% from 2011 to 2014 annualy. EBITDA surged on 23.3% from 2011 to 2014 annualy.
Zhuzhou CSR Times Electric Co Ltd ($3898) financials for the last 5 years
| mln. CNY | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 5,831 | 7,079 | 7,186 | 8,781 | 12,576 |
|---|
| Revenue growth, % | | 21.4% | 1.5% | 22.2% | 43.2% |
|---|
| Gross margin, % | 36.9% | 35.0% | 33.2% | 35.1% | 37.4% |
|---|
| SG&A, % | 15.7% | 16.5% | 16.7% | 17.1% | 17.7% |
|---|
| EBITDA | 1,084 | 1,381 | 1,322 | 1,735 | 2,590 |
|---|
| EBITDA growth, % | | 27.4% | -4.3% | 31.3% | 49.3% |
|---|
| EBITDA margin, % | 18.6% | 19.5% | 18.4% | 19.8% | 20.6% |
|---|
| Net Income | 852 | 1,184 | 1,224 | 1,467 | 2,395 |
|---|
| Net Income margin, % | 14.6% | 16.7% | 17.0% | 16.7% | 19.0% |
|---|
| |
| CAPEX | 230 | 352 | 403 | 298 | 338 |
|---|
| CAPEX/Revenue, % | 3.94% | 4.98% | 5.61% | 3.40% | 2.69% |
|---|
| Debt | 503 | 770 | 783 | 1,024 | 1,623 |
|---|
| Cash | 1,569 | 2,135 | 2,291 | 3,107 | 2,641 |
|---|
| Net Debt/EBITDA | -1.0x | -1.0x | -1.1x | -1.2x | -0.4x |
|---|
| |
| ROIC, % | 20.5% | 21.4% | 16.9% | 17.7% | 20.0% |
|---|
| ROE, % | 20.8% | 24.4% | 21.3% | 19.3% | 23.9% |
|---|
Profitability and return on investment
EBITDA growth was partly attributed to margin expansion. The company showed small growth in EBITDA margin of 0.800 pp from 19.8% to 20.6% in 2014. In the longer period the company showed EBITDA margin growth of 1.10 pp from 19.5% in 2011 to 20.6% in 2014.
We call Zhuzhou CSR Times Electric Co Ltd an attractive growth stock as together with the growth it delivers high ROIC at 20.0%. During the last three years it decreased - it was 21.4% in FY2011. Average ROIC for the last three years was 18.2%.
Zhuzhou CSR Times Electric Co Ltd's Net Income margin surged on 2.30 pp from 16.7% to 19% in 2014. In the longer period the company showed fast Net Income margin growth of 2.30 pp from 16.7% in 2011 to 19% in 2014.
Zhuzhou CSR Times Electric Co Ltd operates at ROE of 23.9%. Average ROE for the last three years was 21.5%.
Capital expenditures (CAPEX)
In FY2014 the company had CAPEX/Revenue of 2.69%. The company's CAPEX/Revenue dropped on 2.29 pp from 4.98% in 2011 to 2.69% in 2014. It's average level of CAPEX/Revenue for the last three years was 3.90%.
Leverage (Debt)
The company has negative net debt at -0.4x Net Debt/EBITDA - at the same time with high growth. In the last 3 years the company's leverage surged on 0.59x from -0.99x in 2011 to -0.39x in 2014.
Peers in Miscellaneous Manufactur
Below we provide Zhuzhou CSR Times Electric Co Ltd benchmarking against other companies in Miscellaneous Manufactur 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 |
|---|
| Sunny Optical Technology Group Co Ltd ($2382) | | 37.4% | 59.5% | 45.9% | 45.0% |
| Time Watch Investments Ltd ($2033) | | 29.3% | 28.2% | 25.4% | 25.6% |
| Lee & Man Chemical Co Ltd ($746) | | 40.7% | -15.9% | -12.6% | 17.4% |
| VS International Group Ltd ($1002) | | 8.9% | -7.1% | -19.3% | 12.3% |
| TK Group Holdings Ltd ($2283) | | 45.8% | 40.2% | 9.3% | 11.8% |
| |
|---|
| Median (13 companies) | | 15.4% | -7.1% | -0.7% | -0.4% |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | | 21.4% | 1.5% | 22.2% | 43.2% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Time Watch Investments Ltd ($2033) | 48.4% | 58.5% | 60.2% | 60.6% | 65.0% |
| Man Sang International Ltd ($938) | 18.5% | 34.7% | 42.4% | 32.8% | 60.3% |
| Lee & Man Chemical Co Ltd ($746) | 44.7% | 46.7% | 34.3% | 35.7% | 41.9% |
| KEE Holdings Co Ltd ($2011) | 40.4% | 32.8% | 27.7% | 30.4% | 30.1% |
| TK Group Holdings Ltd ($2283) | 29.7% | 35.8% | 33.9% | 27.7% | 27.3% |
| |
|---|
| Median (13 companies) | 22.2% | 24.0% | 23.4% | 25.7% | 24.9% |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 36.9% | 35.0% | 33.2% | 35.1% | 37.4% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Lee & Man Chemical Co Ltd ($746) | 40.7% | 42.8% | 30.4% | 31.3% | 38.4% |
| Man Sang International Ltd ($938) | -8.9% | 18.7% | 24.9% | 15.4% | 37.0% |
| Time Watch Investments Ltd ($2033) | 11.6% | 16.8% | 17.6% | 16.8% | 19.4% |
| TK Group Holdings Ltd ($2283) | 16.4% | 22.1% | 21.4% | 18.9% | 17.9% |
| KEE Holdings Co Ltd ($2011) | 24.9% | 18.0% | 9.8% | 11.8% | 12.9% |
| |
|---|
| Median (13 companies) | 11.6% | 8.8% | 6.4% | 6.4% | 6.6% |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 18.6% | 19.5% | 18.4% | 19.8% | 20.6% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Lee & Man Chemical Co Ltd ($746) | 8.7% | 1.4% | 5.8% | 51.1% | 33.7% |
| KEE Holdings Co Ltd ($2011) | 10.0% | 20.9% | 21.8% | 43.7% | 24.9% |
| China Environmental Energy Investment Ltd ($986) | 2.8% | 77.7% | 6.1% | 0.4% | 17.9% |
| TK Group Holdings Ltd ($2283) | 15.2% | 8.9% | 13.3% | 8.1% | 13.7% |
| Karrie International Hldgs ($1050) | 3.7% | 2.6% | 4.9% | 4.7% | 5.2% |
| |
|---|
| Median (13 companies) | 3.7% | 3.4% | 4.7% | 4.2% | 3.7% |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 3.9% | 5.0% | 5.6% | 3.4% | 2.7% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| TK Group Holdings Ltd ($2283) | | 34.0% | 36.8% | 31.1% | 29.4% |
| Time Watch Investments Ltd ($2033) | | 30.5% | 34.5% | 27.1% | 27.8% |
| Sunny Optical Technology Group Co Ltd ($2382) | 9.3% | 12.2% | 19.7% | 17.8% | 16.5% |
| Lee & Man Chemical Co Ltd ($746) | 26.9% | 29.8% | 11.7% | 8.2% | 10.9% |
| Karrie International Hldgs ($1050) | 0.6% | 1.7% | 1.1% | 4.4% | 7.0% |
| |
|---|
| Median (13 companies) | 2.0% | 3.8% | 1.1% | 3.6% | 1.4% |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 20.5% | 21.4% | 16.9% | 17.7% | 20.0% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Continental Holdings Ltd ($513) | | 8.3x | | 20.1x | 92.9x |
| VS International Group Ltd ($1002) | 5.8x | 8.6x | 5.1x | 6.5x | 4.4x |
| Lee & Man Chemical Co Ltd ($746) | 0.2x | -0.3x | -0.2x | 1.5x | 2.2x |
| Sunny Optical Technology Group Co Ltd ($2382) | -0.3x | -0.6x | -0.3x | -0.3x | 0.3x |
| Karrie International Hldgs ($1050) | 1.1x | 2.4x | 0.2x | 0.2x | -0.2x |
| |
|---|
| Median (10 companies) | 0.3x | -0.3x | -0.3x | -0.7x | -0.4x |
|---|
| Zhuzhou CSR Times Electric Co Ltd ($3898) | -1.0x | -1.0x | -1.1x | -1.2x | -0.4x |
