China Aluminum Cans Holdings Ltd is an attractive growth stock: revenue grew 47.0% and EBITDA 30.7% annually over the last three years
02/04/2015 • About China Aluminum Cans Holdings Ltd (
$6898) • By InTwits
China Aluminum Cans Holdings Ltd is a fast-growing stock in Packaging&Containers industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
China Aluminum Cans Holdings Ltd showed growth in the last financial year. The company's revenue surged on 189% in FY2014. EBITDA also increased considerably: 83.7% for the same period.
In the last 3 years the company showed fast revenue growth of 47.0% from 2011 to 2014 annualy. EBITDA surged on 30.7% from 2011 to 2014 annualy.
China Aluminum Cans Holdings Ltd ($6898) financials for the last 5 years
| mln. HKD | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 198 | 237 | 274 | 260 | 753 |
|---|
| Revenue growth, % | | 19.6% | 15.5% | -5.0% | 189.1% |
|---|
| Gross margin, % | 32.4% | 29.3% | 33.3% | 37.2% | 28.5% |
|---|
| SG&A, % | 16.9% | 12.9% | 14.0% | 20.1% | 12.4% |
|---|
| EBITDA | 49 | 57 | 73 | 69 | 126 |
|---|
| EBITDA growth, % | | 15.8% | 29.1% | -5.9% | 83.7% |
|---|
| EBITDA margin, % | 24.7% | 23.9% | 26.7% | 26.4% | 16.8% |
|---|
| Net Income | 22 | 25 | 38 | 37 | 81 |
|---|
| Net Income margin, % | 11.2% | 10.6% | 14.0% | 14.3% | 10.8% |
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| |
| CAPEX | 52 | 3 | 19 | 25 | 156 |
|---|
| CAPEX/Revenue, % | 26.4% | 1.35% | 6.95% | 9.45% | 20.7% |
|---|
| Debt | 102 | 112 | 111 | 107 | 141 |
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| Cash | 32 | 25 | 2 | 107 | 105 |
|---|
| Net Debt/EBITDA | 1.4x | 1.5x | 1.5x | -0.0x | 0.3x |
|---|
| |
| ROIC, % | | 14.8% | 19.7% | 14.6% | 20.2% |
|---|
| ROE, % | | 18.1% | 24.6% | 16.2% | 23.0% |
|---|
Profitability and return on investment
EBITDA margin declined noticeably from 26.4% in FY2013 to 16.8% in FY2014. If we look for the longer period China Aluminum Cans Holdings Ltd showed big decline in EBITDA margin of 7.10 pp from 23.9% in 2011 to 16.8% in 2014.
We call China Aluminum Cans Holdings Ltd an attractive growth stock as together with the growth it delivers high ROIC at 20.2%. During the last three years it surged - it was 14.8% in FY2011. Average ROIC for the last three years was 18.2%.
Net Income margin dropped on 3.50 pp from 14.3% to 10.8% in 2014. In the longer period the company's Net Income margin increased slightly on 0.200 pp from 10.6% in 2011 to 10.8% in 2014.
China Aluminum Cans Holdings Ltd operates at ROE of 23.0%. It's average ROE for the last three years was 21.3%.
Capital expenditures (CAPEX)
To fuel this fast growth China Aluminum Cans Holdings Ltd had to invest in CAPEX.China Aluminum Cans Holdings Ltd's CAPEX/Revenue was 20.7% in FY2014. China Aluminum Cans Holdings Ltd showed fast CAPEX/Revenue growth of 19.4 pp from 1.35% in 2011 to 20.7% in 2014. Average CAPEX/Revenue for the last three years was 12.4%.
Leverage (Debt)
China Aluminum Cans Holdings Ltd has low debt level at 0.3x Net Debt/EBITDA - at the same time with high growth. If we look for the longer period leverage dropped on 1.26x from 1.54x in 2011 to 0.28x in 2014.
Valuation vs. comparable companies
The market closed today at 7.3x EV/EBITDA for China Aluminum Cans Holdings Ltd which is 65% lower than 20.9x Packaging&Containers peer group avearge calculated on the basis of 20 companies. At the end of trading day today China Aluminum Cans Holdings Ltd traded at 11.0x P/E which is 62.1% lower than 28.9x Packaging&Containers peer group avearge calculated on the basis of 6 companies.
Peers in Packaging&Containers
Below we provide China Aluminum Cans Holdings Ltd benchmarking against other companies in Packaging&Containers 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 |
|---|
| Zhengye International Holdings Co Ltd ($3363) | | 10.5% | 6.8% | 16.4% | 18.6% |
| Come Sure Group Holdings Ltd ($794) | | 45.8% | 10.7% | -0.7% | 16.8% |
| Huajun Holdings Ltd ($377) | | 9.8% | 11.2% | 3.3% | 3.4% |
| Kith Holdings Ltd ($1201) | | -3.6% | -60.8% | -3.2% | 2.9% |
| Starlite Holdings Ltd ($403) | | 30.7% | -12.0% | 5.0% | 2.0% |
| |
|---|
| Median (12 companies) | | 15.3% | 4.9% | 5.3% | 0.7% |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | | 19.6% | 15.5% | -5.0% | 189.1% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 40.6% | 39.6% | 36.6% | 39.1% | 37.7% |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 13.6% | 30.2% | 34.3% | 36.5% | 32.8% |
| Kith Holdings Ltd ($1201) | 12.4% | 12.7% | 30.8% | 31.9% | 31.4% |
| Come Sure Group Holdings Ltd ($794) | 17.8% | 17.7% | 17.5% | 20.7% | 22.3% |
| Starlite Holdings Ltd ($403) | 19.2% | 17.2% | 17.5% | 19.0% | 20.4% |
| |
|---|
| Median (12 companies) | 18.2% | 17.7% | 17.5% | 18.9% | 17.9% |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | 32.4% | 29.3% | 33.3% | 37.2% | 28.5% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 39.7% | 35.7% | 33.2% | 26.1% | 27.6% |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 9.7% | 25.5% | 27.9% | 30.7% | 27.4% |
| Kith Holdings Ltd ($1201) | 8.8% | 8.7% | 21.6% | 19.4% | 20.1% |
| Lee & Man Paper Manufacturing Ltd ($2314) | 24.6% | 19.3% | 14.6% | 17.2% | 18.7% |
| CPMC Holdings Ltd ($906) | 11.5% | 10.8% | 11.9% | 13.7% | 13.2% |
| |
|---|
| Median (13 companies) | 11.5% | 9.2% | 7.8% | 8.7% | 8.1% |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | 24.7% | 23.9% | 26.7% | 26.4% | 16.8% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 5.3% | 13.5% | 19.7% | 13.7% | 13.1% |
| Hao Tian Development Group Ltd ($474) | 2.2% | 88.2% | 81.6% | | 13.0% |
| CPMC Holdings Ltd ($906) | 10.3% | 13.7% | 16.7% | 19.7% | 8.6% |
| Zhengye International Holdings Co Ltd ($3363) | 7.2% | 7.0% | 11.0% | 5.1% | 6.4% |
| Starlite Holdings Ltd ($403) | 2.2% | 3.4% | 5.1% | 3.2% | 5.7% |
| |
|---|
| Median (13 companies) | 2.7% | 5.6% | 9.7% | 5.0% | 4.1% |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | 26.4% | 1.3% | 6.9% | 9.5% | 20.7% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | | 38.7% | 35.3% | 18.4% | 15.4% |
| Lee & Man Paper Manufacturing Ltd ($2314) | 12.9% | 11.3% | 7.2% | 8.7% | 8.0% |
| Kith Holdings Ltd ($1201) | 9.9% | 7.7% | 6.9% | 5.6% | 7.8% |
| CPMC Holdings Ltd ($906) | 10.1% | 8.9% | 8.3% | 8.7% | 7.3% |
| Zhengye International Holdings Co Ltd ($3363) | 14.5% | 10.0% | 7.7% | 6.2% | 5.4% |
| |
|---|
| Median (13 companies) | 8.4% | 7.7% | 6.9% | 5.6% | 4.6% |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | | 14.8% | 19.7% | 14.6% | 20.2% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Zhengye International Holdings Co Ltd ($3363) | 3.9x | 4.0x | 6.2x | 6.4x | 7.8x |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 2.9x | 0.7x | 9.4x | 6.7x | 7.4x |
| Sino Haijing Holdings Ltd ($1106) | 0.6x | 4.7x | 6.4x | 6.1x | 6.2x |
| Come Sure Group Holdings Ltd ($794) | -3.3x | -1.1x | 3.6x | 4.1x | 3.8x |
| Lee & Man Paper Manufacturing Ltd ($2314) | 2.4x | 2.5x | 4.1x | 3.5x | 3.4x |
| |
|---|
| Median (12 companies) | 0.5x | 0.6x | 2.1x | 2.4x | 2.5x |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | 1.4x | 1.5x | 1.5x | -0.0x | 0.3x |
