Welspun India Net Income jumped on 486% in 2015 and EBITDA Margin increased slightly on 1.5 pp from 22.6% to 24.1%
29-04-2015 • About Welspun India (
$WELSPUNIND) • By InTwits
Welspun India reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 24.1% in FY2015 vs. 22.6% in FY2014 vs. 13.3% in FY2011
- Welspun India has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.4%. At the same time it's a lot of higher than industry average of 7.7%.
- CAPEX is quite volatile: 5,795 in FY2015, 7,186 in FY2014, 2,847 in FY2013, 1,808 in FY2012, 2,091 in FY2011
- The company has highly profitable business model: ROIC is at 21.9%
- It operates with medium-size leverage: Net Debt/EBITDA is 2.2x while industry average is 2.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Welspun India ($WELSPUNIND) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 18,565 | 32,205 | 36,473 | 43,730 | 53,025 | 21.3% |
| EBITDA | 2,476 | 3,927 | 6,131 | 9,881 | 12,784 | 29.4% |
| Net Income | 14 | -134 | 2,248 | 921 | 5,398 | 486.3% |
Balance Sheet
|
|---|
| Cash | 263 | 1,476 | 1,718 | 2,323 | 3,235 | 39.3% |
| Short Term Debt | 7,321 | 9,810 | 9,166 | 11,349 | 14,935 | 31.6% |
| Long Term Debt | 10,077 | 9,812 | 10,011 | 16,795 | 15,946 | -5.1% |
Cash flow
|
|---|
| Capex | 2,091 | 1,808 | 2,847 | 7,186 | 5,795 | -19.4% |
Ratios
|
|---|
| Revenue growth | -69.8% | 73.5% | 13.3% | 19.9% | 21.3% | |
| EBITDA growth | -14.0% | 58.6% | 56.1% | 61.2% | 29.4% | |
| EBITDA Margin | 13.3% | 12.2% | 16.8% | 22.6% | 24.1% | 1.5% |
| Net Income Margin | 0.1% | -0.4% | 6.2% | 2.1% | 10.2% | 8.1% |
| CAPEX, % of revenue | 11.3% | 5.6% | 7.8% | 16.4% | 10.9% | -5.5% |
| ROIC | 5.1% | 9.3% | 15.6% | 8.5% | 21.9% | 13.5% |
| ROE | 0.2% | -1.9% | 25.9% | 8.8% | 42.5% | 33.7% |
| Net Debt/EBITDA | 6.9x | 4.6x | 2.8x | 2.6x | 2.2x | -0.5x |
Revenue and profitability
The company's Revenue surged on 21.3% in FY2015. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.5 pp from 22.6% to 24.1% in FY2015.
Net Income marign increased on 8.1 pp from 2.1% to 10.2% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Welspun India had CAPEX/Revenue of 10.9%. CAPEX/Revenue increased on 5.3 pp from 5.6% in FY2012 to 10.9% in FY2015. It's average CAPEX/Revenue for the last three years was 11.7%.
Return on investment
The company operates at high and attractive ROIC (21.93%) and ROE (42.48%). ROIC surged on 13.5 pp from 8.5% to 21.9% in FY2015. ROE jumped on 33.7 pp from 8.8% to 42.5% in FY2015.
Leverage (Debt)
Debt level is 2.2x Net Debt / EBITDA and 2.4x Debt / EBITDA. Net Debt / EBITDA dropped on 0.5x from 2.6x to 2.2x in FY2015. Debt increased on 9.7% in FY2015 while cash jumped on 39.3% in FY2015.
Appendix 1: Peers in Textiles
Below we provide Welspun India benchmarking against other companies in Textiles 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 |
|---|
| Olympia Industries ($OLYMPTX) | -99.6% | -58.0% | -96.6% | 74,809.1% | |
| Gujarat Cotex ($GUJCOTEX) | 625.9% | -6.2% | -66.0% | 176.2% | |
| T T ($TTL) | -39.2% | -21.8% | 28.7% | 47.8% | |
| Filatex India ($FILATEX) | -74.3% | -2.7% | 158.7% | 44.5% | |
| Gtn Textiles ($GTNTEX) | -27.7% | -8.8% | 51.2% | 39.4% | |
| |
|---|
| Median (73 companies) | -32.8% | 4.8% | 9.3% | 14.2% | 10.4% |
|---|
| Welspun India ($WELSPUNIND) | | 73.5% | 13.3% | 19.9% | 21.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ruby Mills ($RUBYMILLS) | 25.2% | 28.3% | 25.1% | 28.6% | |
| Vardhman Textiles ($VTL) | 24.9% | 13.8% | 20.1% | 24.3% | |
| Nitin Spinners ($NITINSPIN) | 23.7% | 10.5% | 19.7% | 19.3% | |
| Shri Dinesh Mills ($SHRIDINE) | 24.7% | 22.4% | 18.5% | 18.7% | |
| Grasim Industries ($GRASIM) | 23.4% | 22.3% | 21.4% | 16.9% | |
| |
|---|
| Median (53 companies) | 12.7% | 6.3% | 9.5% | 9.5% | 8.0% |
|---|
| Welspun India ($WELSPUNIND) | 13.3% | 12.2% | 16.8% | 22.6% | 24.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jindal Worldwide ($JINDWORLD) | 3.6% | 3.0% | 10.5% | 20.7% | |
| SRF ($SRF) | 0.0% | 0.0% | 18.7% | 20.0% | |
| Sel Manufacturing Company ($SELMCL) | 54.2% | 53.9% | 25.1% | 14.0% | |
| Grasim Industries ($GRASIM) | 7.8% | 17.7% | 21.7% | 11.6% | |
| Dcm ($DCM) | 3.0% | 2.7% | 9.1% | 11.6% | |
| |
|---|
| Median (20 companies) | 4.5% | 3.0% | 5.3% | 6.7% | 4.3% |
|---|
| Welspun India ($WELSPUNIND) | 11.3% | 5.6% | 7.8% | 16.4% | 10.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nitin Spinners ($NITINSPIN) | 13.8% | 6.0% | 19.5% | 21.5% | |
| Sutlej Textiles & Industries ($SUTLEJTEX) | 16.0% | 9.5% | 13.6% | 19.8% | |
| Vardhman Textiles ($VTL) | 15.5% | 6.6% | 11.9% | 17.3% | |
| Maral Overseas ($MARALOVER) | | 4.6% | 14.1% | 16.0% | |
| Rswm ($RSWM) | 17.4% | 2.2% | 15.2% | 15.5% | |
| |
|---|
| Median (126 companies) | 10.1% | 3.5% | 9.0% | 9.6% | 7.6% |
|---|
| Welspun India ($WELSPUNIND) | 5.1% | 9.3% | 15.6% | 8.5% | 21.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jaybharat Textiles & Real Estate ($JAYTEX) | 8.4x | 10.9x | 53.6x | 23.8x | |
| Sree Jayalakshmi Autospin ($SREEJAYA) | 3.4x | | 9.7x | 12.8x | |
| Bombay Rayon Fashions ($BRFL) | 5.9x | 4.9x | 4.9x | 11.6x | |
| Sel Manufacturing Company ($SELMCL) | 5.6x | 9.4x | 6.6x | 11.5x | |
| Ruby Mills ($RUBYMILLS) | 15.9x | 12.6x | 15.3x | 10.8x | |
| |
|---|
| Median (69 companies) | 3.7x | 3.8x | 3.2x | 0.0x | 4.1x |
|---|
| Welspun India ($WELSPUNIND) | 6.9x | 4.6x | 2.8x | 2.6x | 2.2x |
