The numbers tell that CNQC International Holdings Ltd is a solid growth stock
30/03/2016 • About CNQC International Holdings Ltd (
$1240) • By InTwits
CNQC International Holdings Ltd is a fast-growing stock in Engineering&Construction industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
CNQC International Holdings Ltd showed growth in the last financial year. The company's revenue surged on 807% in FY2015. The growth also happened in EBITDA of 399% for the same period.
In the last 3 years the company showed fast revenue growth of 228% from 2012 to 2015 annualy. EBITDA surged on 168% from 2012 to 2015 annualy.
CNQC International Holdings Ltd ($1240) financials for the last 5 years
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 |
|---|
| Revenue | 258 | 313 | 598 | 1,218 | 11,053 |
|---|
| Revenue growth, % | | 21.6% | 91.0% | 103.7% | 807.4% |
|---|
| Gross margin, % | 27.5% | 19.1% | 19.1% | 18.7% | 16.3% |
|---|
| SG&A, % | | | | | 6.50% |
|---|
| EBITDA | 61 | 62 | 118 | 239 | 1,191 |
|---|
| EBITDA growth, % | | 1.8% | 89.8% | 102.8% | 398.9% |
|---|
| EBITDA margin, % | 23.7% | 19.8% | 19.7% | 19.6% | 10.8% |
|---|
| Net Income | 35 | 26 | 65 | 156 | 577 |
|---|
| Net Income margin, % | 13.7% | 8.23% | 10.9% | 12.8% | 5.22% |
|---|
| |
| CAPEX | 77 | 43 | 74 | 128 | 39 |
|---|
| CAPEX/Revenue, % | 29.8% | 13.6% | 12.3% | 10.5% | 0.350% |
|---|
| Debt | 92 | 109 | 142 | 197 | 7,923 |
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| Cash | 45 | 47 | 58 | 189 | 1,626 |
|---|
| Net Debt/EBITDA | 0.8x | 1.0x | 0.7x | 0.0x | 5.3x |
|---|
| |
| ROIC, % | 23.1% | 12.2% | 22.3% | 40.4% | 21.8% |
|---|
| ROE, % | 34.7% | 16.4% | 29.9% | 59.2% | 66.1% |
|---|
Profitability and return on investment
EBITDA margin declined noticeably from 19.6% in FY2014 to 10.8% in FY2015. In the last 3 years EBITDA margin dropped on 9 pp from 19.8% in 2012 to 10.8% in 2015.
CNQC International Holdings Ltd shows attractive ROIC at 21.8% for the last 12 months which assumes stable development model. During the last three years it surged - it was 12.2% in FY2012. For the last three years the average ROIC was 28.2%.
CNQC International Holdings Ltd's Net Income margin dropped on 7.60 pp from 12.8% to 5.20% in 2015. In the last 3 years Net Income margin dropped on 3 pp from 8.20% in 2012 to 5.20% in 2015.
CNQC International Holdings Ltd operates at ROE of 66.1%. For the last three years the average ROE was 51.7%.
Capital expenditures (CAPEX)
In FY2015 the company had CAPEX/Revenue of 0.350%. CAPEX/Revenue dropped on 13.3 pp from 13.6% in 2012 to 0.350% in 2015. It's average level of CAPEX/Revenue for the last three years was 7.74%.
Leverage (Debt)
CNQC International Holdings Ltd has high debt level at 5.3x Net Debt/EBITDA to maintain high growth. This could become a risk fastor if the growth slows down but the company doesn't decrease debt level by that time. In the longer period CNQC International Holdings Ltd showed fast leverage growth of 4.29x from 1.00x in 2012 to 5.29x in 2015.
Valuation vs. comparable companies
The market closed today at 6.8x EV/EBITDA for CNQC International Holdings Ltd which is 78.3% lower than 31.3x Engineering&Construction peer group avearge calculated on the basis of 55 companies. The market closed today at 3.1x P/E for CNQC International Holdings Ltd which is 75.1% lower than 12.4x Engineering&Construction peer group avearge calculated on the basis of 16 companies.
Peers in Engineering&Construction
Below you can find CNQC International Holdings Ltd benchmarking vs. other companies in Engineering&Construction industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Richly Field China Development Ltd ($313) | | | -45.0% | 464.2% | -65.7% |
| Junefield Department Store Group Ltd ($758) | 22.9% | -20.3% | -24.9% | 126.6% | |
| Wison Engineering Services Co Ltd ($2236) | 1.2% | -2.9% | -24.9% | 90.3% | |
| China Resources and Transportation Group Ltd ($269) | | 939.8% | 3,196.3% | 87.9% | -41.6% |
| Broad Greenstate International Co Ltd ($1253) | | 25.2% | 30.8% | 82.9% | 17.5% |
| |
|---|
| Median (42 companies) | 8.2% | 9.7% | 21.0% | 14.0% | 12.6% |
|---|
| CNQC International Holdings Ltd ($1240) | | 21.6% | 91.0% | 103.7% | 807.4% |
Top companies by Gross margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Huayu Expressway Group Ltd ($1823) | 2.2% | 43.6% | 65.6% | 64.0% | |
| HNA Infrastructure Company Ltd ($357) | 61.6% | 66.4% | 62.1% | 62.4% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 50.1% | 54.1% | 54.3% | 41.5% | 30.1% |
| Kingbo Strike Ltd ($1421) | 22.9% | 32.4% | 44.4% | 40.3% | 30.7% |
| Broad Greenstate International Co Ltd ($1253) | 16.7% | 20.1% | 28.7% | 35.8% | 36.7% |
| |
|---|
| Median (37 companies) | 11.0% | 12.4% | 12.1% | 12.9% | 13.3% |
|---|
| CNQC International Holdings Ltd ($1240) | 27.5% | 19.1% | 19.1% | 18.7% | 16.3% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Huayu Expressway Group Ltd ($1823) | -0.5% | 46.2% | 73.8% | 77.1% | |
| HNA Infrastructure Company Ltd ($357) | 60.0% | 62.8% | 63.7% | 62.8% | |
| Beijing Capital International Airport Co Ltd ($694) | 55.1% | 53.4% | 52.9% | 50.3% | 51.6% |
| Cheung Kong Infrastructure Holdings Ltd ($1038) | 39.8% | 31.2% | 20.6% | 36.2% | 60.9% |
| Grand Ming Group Holdings Ltd ($1271) | 17.5% | 10.0% | 15.8% | 31.0% | 19.0% |
| |
|---|
| Median (43 companies) | 8.5% | 9.2% | 7.8% | 6.8% | 8.1% |
|---|
| CNQC International Holdings Ltd ($1240) | 23.7% | 19.8% | 19.7% | 19.6% | 10.8% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| HNA Infrastructure Company Ltd ($357) | 43.3% | 36.8% | 5.7% | 85.4% | |
| PYI Corp Ltd ($498) | 6.6% | 3.7% | 4.2% | 24.5% | 13.1% |
| Shun Cheong Holdings ($650) | 7.2% | 16.4% | 8.0% | 23.9% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 6.1% | 4.2% | 7.7% | 20.2% | 3.2% |
| KFM Kingdom Holdings Ltd ($3816) | 6.5% | 4.6% | 11.5% | 14.9% | 9.6% |
| |
|---|
| Median (43 companies) | 4.3% | 2.3% | 2.5% | 1.6% | 2.4% |
|---|
| CNQC International Holdings Ltd ($1240) | 29.8% | 13.6% | 12.3% | 10.5% | 0.4% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Chun Sing Engineering Holdings Ltd ($2277) | | | 98.3% | 54.9% | 43.7% |
| Broad Greenstate International Co Ltd ($1253) | | 33.2% | 85.1% | 51.2% | 26.0% |
| Kingbo Strike Ltd ($1421) | | 56.9% | 125.4% | 48.9% | 11.4% |
| Ngai Shun Holdings Ltd ($1246) | | 68.8% | 77.2% | 45.2% | 31.0% |
| China Saite Group Co Ltd ($153) | 46.3% | 64.0% | 53.2% | 35.3% | |
| |
|---|
| Median (44 companies) | 6.9% | 5.8% | 5.3% | 4.1% | 2.7% |
|---|
| CNQC International Holdings Ltd ($1240) | 23.1% | 12.2% | 22.3% | 40.4% | 21.8% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| China Resources and Transportation Group Ltd ($269) | | | | 66.7x | 29.7x |
| CNC Holdings Ltd ($8356) | -0.7x | | 22.0x | 21.9x | 24.3x |
| Deson Development International Holdings ($262) | 3.1x | 3.8x | 4.9x | 13.7x | 47.0x |
| Chun Wo Development Holdings Ltd ($711) | | 14.3x | 8.1x | 12.6x | 15.9x |
| Hsin Chong Construction Group Ltd ($404) | 4.3x | 1.8x | 8.0x | 10.2x | |
| |
|---|
| Median (36 companies) | 0.5x | 1.5x | 1.7x | 2.4x | 2.2x |
|---|
| CNQC International Holdings Ltd ($1240) | 0.8x | 1.0x | 0.7x | 0.0x | 5.3x |
