Tata Elxsi Net Income surged on 41.2% in 2015 and EBITDA Margin increased on 3.3 pp from 17.6% to 20.9%
28-04-2015 • About Tata Elxsi (
$TATAELXSI) • By InTwits
Tata Elxsi reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tata Elxsi has low CAPEX intensity: 5 year average CAPEX/Revenue was 5.0%. At the same time it's in pair with industry average of 7.0%.
- CAPEX is quite volatile: 207 in FY2015, 597 in FY2014, 378 in FY2013, 560 in FY2012, 437 in FY2011
- The company has highly profitable business model: ROIC is at 55.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Tata Elxsi ($TATAELXSI) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4,159 | 5,387 | 6,217 | 7,748 | 8,494 | 9.6% |
| EBITDA | 472 | 743 | 738 | 1,365 | 1,773 | 29.9% |
| Net Income | 325 | 346 | 213 | 723 | 1,020 | 41.2% |
Balance Sheet
|
|---|
| Cash | 208 | 120 | 125 | 362 | 1,212 | 234.9% |
| Short Term Debt | 254 | 342 | 585 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 291 | 287 | 338 | 240 | 331 | 37.6% |
Ratios
|
|---|
| Revenue growth | -59.1% | 29.5% | 15.4% | 24.6% | 9.6% | |
| EBITDA growth | -38.6% | 57.5% | -0.7% | 84.9% | 29.9% | |
| EBITDA Margin | 11.4% | 13.8% | 11.9% | 17.6% | 20.9% | 3.3% |
| Net Income Margin | 7.8% | 6.4% | 3.4% | 9.3% | 12.0% | 2.7% |
| CAPEX, % of revenue | 7.0% | 5.3% | 5.4% | 3.1% | 3.9% | 0.8% |
| ROIC | 13.2% | 22.5% | 19.1% | 38.3% | 55.4% | 17.1% |
| ROE | 18.2% | 18.5% | 11.0% | 33.5% | 39.3% | 5.8% |
| Net Debt/EBITDA | 0.1x | 0.3x | 0.6x | -0.3x | -0.7x | -0.4x |
Revenue and profitability
The company's Revenue increased on 9.6% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 21.3 pp from 30.7% to 9.5% in FY2015.
Net Income marign increased on 2.7 pp from 9.3% to 12.0% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 3.9%. Tata Elxsi's CAPEX/Revenue decreased slightly on 1.4 pp from 5.3% in FY2012 to 3.9% in FY2015. It's average level of CAPEX/Revenue for the last three years was 4.1%.
Return on investment
The company operates at high and attractive ROIC (55.44%) and ROE (39.30%). ROIC jumped on 17.1 pp from 38.3% to 55.4% in FY2015. ROE increased on 5.8 pp from 33.5% to 39.3% in FY2015.
Leverage (Debt)
The company has no debt. Cash jumped on 235% in FY2015.
Management team
Madhukar Dev is a Tata Elxsi's CEO. Madhukar Dev has spent 19 years at the company. K Ramaseshan is a Tata Elxsi's CFO. K Ramaseshan has spent 3 years at the company.
Appendix 1: Peers in IT Software Products
Below we provide Tata Elxsi benchmarking against other companies in IT Software Products 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, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Blue Star Infotech ($BLUESTINFO) | -61.0% | 5.1% | 49.2% | 43.3% | |
| Saksoft ($SAKSOFT) | -60.3% | 16.3% | 29.5% | 41.1% | |
| Twinstar Industries ($TWINSTAR) | -90.5% | 204.5% | 59.8% | 38.8% | |
| Datamatics Global Services ($DATAMATICS) | -71.6% | 60.5% | 24.5% | 33.4% | |
| Trigyn Technologies ($TRIGYN) | -59.5% | 16.8% | 27.1% | 29.8% | |
| |
|---|
| Median (15 companies) | -47.6% | 15.1% | 17.7% | 14.2% | 19.0% |
|---|
| Tata Elxsi ($TATAELXSI) | | 29.5% | 15.4% | 24.6% | 9.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Atishay Infotech ($ATISHAY) | 19.6% | 35.7% | 28.1% | 25.8% | 24.5% |
| Subex ($SUBEX) | 26.8% | 27.3% | 17.0% | 24.9% | |
| Datamatics Global Services ($DATAMATICS) | 5.6% | 9.2% | 9.4% | 12.4% | |
| Aurionpro Solutions ($AURIONPRO) | 21.4% | 15.9% | 14.5% | 12.0% | |
| Saksoft ($SAKSOFT) | 10.1% | 10.8% | 10.9% | 10.5% | |
| |
|---|
| Median (13 companies) | 8.1% | 7.5% | 8.5% | 9.9% | 7.4% |
|---|
| Tata Elxsi ($TATAELXSI) | 11.4% | 13.8% | 11.9% | 17.6% | 20.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dion Global Solutions ($DION) | 10.7% | 39.9% | 11.9% | 29.6% | |
| Datamatics Global Services ($DATAMATICS) | 5.7% | 20.2% | 3.1% | 12.9% | |
| Aurionpro Solutions ($AURIONPRO) | 15.7% | 17.5% | 12.3% | 12.6% | |
| Atishay Infotech ($ATISHAY) | 3.8% | 41.7% | 8.6% | 10.0% | |
| Blue Star Infotech ($BLUESTINFO) | 6.0% | 1.4% | 3.1% | 2.3% | |
| |
|---|
| Median (10 companies) | 4.6% | 3.1% | 5.7% | 1.9% | 4.9% |
|---|
| Tata Elxsi ($TATAELXSI) | 7.0% | 5.3% | 5.4% | 3.1% | 3.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Trigyn Technologies ($TRIGYN) | 15.7% | 15.2% | 21.1% | 26.2% | |
| Mindteck (India) ($MINDTECK) | 6.7% | -2.6% | 1.2% | 20.0% | |
| Atishay Infotech ($ATISHAY) | 30.9% | 27.2% | 15.7% | 19.2% | |
| Datamatics Global Services ($DATAMATICS) | 2.5% | 9.8% | 11.4% | 16.4% | |
| Blue Star Infotech ($BLUESTINFO) | | | 7.1% | 16.3% | |
| |
|---|
| Median (31 companies) | 3.9% | 3.8% | 4.7% | 14.4% | 3.1% |
|---|
| Tata Elxsi ($TATAELXSI) | 13.2% | 22.5% | 19.1% | 38.3% | 55.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Subex ($SUBEX) | 4.2x | 4.6x | 13.1x | 8.5x | |
| Aurionpro Solutions ($AURIONPRO) | 1.1x | 1.7x | 1.7x | 1.9x | |
| Datamatics Global Services ($DATAMATICS) | 0.2x | 0.5x | 0.3x | 0.5x | |
| Atishay Infotech ($ATISHAY) | -1.0x | -0.2x | -0.0x | 0.3x | 0.0x |
| Ace Software Exports ($ACESOFT) | | | | 0.0x | |
| |
|---|
| Median (14 companies) | 0.2x | 0.7x | 0.0x | 0.0x | 0.0x |
|---|
| Tata Elxsi ($TATAELXSI) | 0.1x | 0.3x | 0.6x | -0.3x | -0.7x |
