Nitin Spinners CAPEX surged on 566% in 2015 and Revenue jumped on 26.2%
04-05-2015 • About Nitin Spinners (
$NITINSPIN) • By InTwits
Nitin Spinners reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Nitin Spinners has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.0%. At the same time it's in pair with industry average of 9.5%.
- CAPEX is quite volatile: 2,610 in FY2015, 392 in FY2014, 117 in FY2013, 82.8 in FY2012, 9.8 in FY2011
- The company has highly profitable business model: ROIC is at 17.5%
- It operates with high leverage: Net Debt/EBITDA is 3.3x while industry average is 2.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Nitin Spinners ($NITINSPIN) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4,109 | 4,283 | 4,461 | 4,883 | 6,165 | 26.2% |
| EBITDA | 973 | 451 | 879 | 941 | 1,048 | 11.4% |
| Net Income | 67 | 3 | 141 | 348 | 410 | 17.8% |
Balance Sheet
|
|---|
| Cash | 1 | 1 | 3 | 1 | 7 | 965.8% |
| Short Term Debt | 755 | 652 | 443 | 454 | 533 | 17.5% |
| Long Term Debt | 2,085 | 1,837 | 1,623 | 1,307 | 2,942 | 125.1% |
Cash flow
|
|---|
| Capex | 10 | 83 | 117 | 392 | 2,610 | 565.7% |
Ratios
|
|---|
| Revenue growth | -44.3% | 4.2% | 4.1% | 9.5% | 26.2% | |
| EBITDA growth | 183.6% | -53.7% | 95.1% | 7.0% | 11.4% | |
| EBITDA Margin | 23.7% | 10.5% | 19.7% | 19.3% | 17.0% | -2.3% |
| Net Income Margin | 1.6% | 0.1% | 3.2% | 7.1% | 6.6% | -0.5% |
| CAPEX, % of revenue | 0.2% | 1.9% | 2.6% | 8.0% | 42.3% | 34.3% |
| ROIC | 13.8% | 6.0% | 19.5% | 21.5% | 17.5% | -4.0% |
| ROE | 8.1% | 0.4% | 15.1% | 29.9% | 27.4% | -2.5% |
| Net Debt/EBITDA | 2.9x | 5.5x | 2.3x | 1.9x | 3.3x | 1.4x |
Revenue and profitability
The company's Revenue surged on 26.2% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 17.3 pp from 2.0% to -15.2% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 42.3%. The company's CAPEX/Revenue surged on 40.4 pp from 1.9% in FY2012 to 42.3% in FY2015. It's average level of CAPEX/Revenue for the last three years was 17.7%.To fuel this fast growth Nitin Spinners made large investments to CAPEX (249% of EBITDA).
Return on investment
The company operates at high and attractive ROE (27.44%) while ROIC is a bit lower (17.53%). ROIC decreased on 4.0 pp from 21.5% to 17.5% in FY2015. ROE decreased on 2.5 pp from 29.9% to 27.4% in FY2015.
Leverage (Debt)
Debt level is 3.3x Net Debt / EBITDA and 3.3x Debt / EBITDA. Net Debt / EBITDA jumped on 1.4x from 1.9x to 3.3x in FY2015. Debt surged on 97.4% in FY2015 while cash jumped on 966% in FY2015.
Valuation
Nitin Spinners's trades at EV/EBITDA 5.3x and P/E 5.1x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Textiles
Below we provide Nitin Spinners 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 ($GTNTEX) | -27.7% | -8.8% | 51.2% | 39.4% | |
| |
|---|
| Median (73 companies) | -32.1% | 5.0% | 10.0% | 14.4% | 7.7% |
|---|
| Nitin Spinners ($NITINSPIN) | | 4.2% | 4.1% | 9.5% | 26.2% |
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% | |
| Welspun India ($WELSPUNIND) | 13.3% | 12.2% | 16.8% | 22.6% | 24.1% |
| Shri Dinesh Mills ($SHRIDINE) | 24.7% | 22.4% | 18.5% | 18.7% | |
| Grasim Industries ($GRASIM) | 23.4% | 22.3% | 21.4% | 16.9% | 15.9% |
| |
|---|
| Median (53 companies) | 12.7% | 6.3% | 9.5% | 9.5% | 14.2% |
|---|
| Nitin Spinners ($NITINSPIN) | 23.7% | 10.5% | 19.7% | 19.3% | 17.0% |
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% | |
| Welspun India ($WELSPUNIND) | 11.3% | 5.6% | 7.8% | 16.4% | 10.9% |
| Sel Manufacturing Company ($SELMCL) | 54.2% | 53.9% | 25.1% | 14.0% | |
| Grasim Industries ($GRASIM) | 7.8% | 17.7% | 21.7% | 11.6% | 10.2% |
| |
|---|
| Median (20 companies) | 4.5% | 3.4% | 5.9% | 6.7% | 8.4% |
|---|
| Nitin Spinners ($NITINSPIN) | 0.2% | 1.9% | 2.6% | 8.0% | 42.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| 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% | |
| Mandhana Industries ($MANDHANA) | 86.1% | 12.1% | 13.2% | 14.2% | |
| |
|---|
| Median (126 companies) | 10.1% | 3.5% | 9.0% | 8.9% | 10.5% |
|---|
| Nitin Spinners ($NITINSPIN) | 13.8% | 6.0% | 19.5% | 21.5% | 17.5% |
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 ($RUBYMILLS) | 15.9x | 12.6x | 15.3x | 10.8x | |
| |
|---|
| Median (69 companies) | 3.9x | 3.8x | 3.2x | 0.0x | 2.3x |
|---|
| Nitin Spinners ($NITINSPIN) | 2.9x | 5.5x | 2.3x | 1.9x | 3.3x |
