Adi Finechem CAPEX jumped on 33.7% in 2015 and Revenue decreased slightly on 0.79%
05-05-2015 • About Adi Finechem (
$ADIFINCHM) • By InTwits
Adi Finechem reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Adi Finechem has medium CAPEX intensity: 5 year average CAPEX/Revenue was 10.0%. At the same time it's a lot of higher than industry average of 4.7%.
- CAPEX is quite volatile: 255 in FY2015, 191 in FY2014, 59.5 in FY2013, 71.1 in FY2012, 47.2 in FY2011
- The company has highly profitable business model: ROIC is at 26.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Adi Finechem ($ADIFINCHM) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 574 | 972 | 1,231 | 1,518 | 1,506 | -0.8% |
| EBITDA | 105 | 147 | 173 | 335 | 249 | -25.7% |
| Net Income | 51 | 74 | 84 | 187 | 137 | -26.7% |
Balance Sheet
|
|---|
| Cash | 2 | 1 | 1 | 1 | 2 | 129.6% |
| Short Term Debt | 99 | 149 | 127 | 220 | 149 | -32.6% |
| Long Term Debt | 44 | 62 | 54 | 70 | 139 | 97.8% |
Cash flow
|
|---|
| Capex | 47 | 71 | 60 | 191 | 255 | 33.7% |
Ratios
|
|---|
| Revenue growth | -66.2% | 69.4% | 26.7% | 23.3% | -0.8% | |
| EBITDA growth | 304.0% | 40.2% | 17.8% | 93.8% | -25.7% | |
| EBITDA Margin | 18.2% | 15.1% | 14.0% | 22.1% | 16.5% | -5.5% |
| Net Income Margin | 8.8% | 7.6% | 6.8% | 12.3% | 9.1% | -3.2% |
| CAPEX, % of revenue | 8.2% | 7.3% | 4.8% | 12.6% | 16.9% | 4.4% |
| ROIC | 27.6% | 30.6% | 29.8% | 46.4% | 26.3% | -20.1% |
| ROE | 32.7% | 35.8% | 30.7% | 47.8% | 26.3% | -21.5% |
| Net Debt/EBITDA | 1.3x | 1.4x | 1.0x | 0.9x | 1.1x | 0.3x |
Revenue and profitability
The company's Revenue decreased slightly on 0.79% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 7.4 pp from -13.5% to -6.1% in FY2015.
Net Income marign decreased on 3.2 pp from 12.3% to 9.1% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 16.9% in FY2015. CAPEX/Revenue increased on 9.6 pp from 7.3% in FY2012 to 16.9% in FY2015. For the last three years the average CAPEX/Revenue was 11.5%.Battling declining revenue Adi Finechem made large investments to CAPEX (103% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at high and attractive ROIC (26.34%) and ROE (26.30%). ROIC dropped on 20.1 pp from 46.4% to 26.3% in FY2015. ROE dropped on 21.5 pp from 47.8% to 26.3% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.1x and Debt / EBITDA is 1.2x. Net Debt / EBITDA surged on 0.3x from 0.9x to 1.1x in FY2015. Debt decreased slightly on 1.0% in FY2015 while cash surged on 130% in FY2015.
Valuation
The company's trades at EV/EBITDA 16.3x and P/E 27.5x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Specialty Chemicals
Below you can find Adi Finechem benchmarking vs. other companies in Specialty Chemicals 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, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dai-Ichi Karkaria ($DAICHI) | | 20.7% | 31.4% | 45.4% | 22.8% |
| Dynemic Products ($DYNPRO) | -55.8% | 27.4% | -0.0% | 40.6% | |
| Camlin Fine Sciences ($CAMLINFIN) | -75.1% | 95.3% | 11.4% | 36.1% | |
| Sudarshan Chemical Industries ($SUDARSCHEM) | -49.4% | 10.5% | 9.1% | 28.2% | |
| Vinati Organics ($VINATIORGA) | -63.9% | 38.7% | 23.6% | 25.9% | |
| |
|---|
| Median (27 companies) | -50.1% | 19.8% | 11.4% | 11.3% | 21.1% |
|---|
| Adi Finechem ($ADIFINCHM) | | 69.4% | 26.7% | 23.3% | -0.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vinati Organics ($VINATIORGA) | 21.7% | 21.7% | 21.8% | 22.7% | |
| Solar Industries India ($SOLARINDS) | 18.1% | 18.5% | 17.5% | 17.9% | |
| Ultramarine & Pigments ($ULTRAMAR) | 20.1% | 18.0% | 15.5% | 17.4% | |
| Anil ($ANILLTD) | 17.4% | 18.1% | 16.9% | 17.1% | |
| Dynemic Products ($DYNPRO) | 17.3% | 13.6% | 11.2% | 16.0% | |
| |
|---|
| Median (25 companies) | 11.2% | 10.6% | 11.2% | 10.6% | 8.7% |
|---|
| Adi Finechem ($ADIFINCHM) | 18.2% | 15.1% | 14.0% | 22.1% | 16.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Solar Industries India ($SOLARINDS) | 14.2% | 13.0% | 9.9% | 12.3% | |
| Nitta Gelatin India ($NITTAGELA) | 21.3% | 8.8% | 4.6% | 8.5% | |
| Meghmani Organics ($MEGH) | 9.9% | 10.2% | 10.3% | 7.9% | |
| Camlin Fine Sciences ($CAMLINFIN) | 7.5% | 4.3% | 5.7% | 7.1% | |
| Kiri Industries ($KIRIINDUS) | 5.3% | 5.4% | 4.5% | 5.6% | |
| |
|---|
| Median (18 companies) | 7.0% | 4.9% | 4.5% | 4.3% | 1.4% |
|---|
| Adi Finechem ($ADIFINCHM) | 8.2% | 7.3% | 4.8% | 12.6% | 16.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vinati Organics ($VINATIORGA) | 31.4% | 29.6% | 26.2% | 30.6% | |
| Pidilite Industries ($PIDILITIND) | 29.3% | 27.4% | 29.3% | 29.8% | |
| Camlin Fine Sciences ($CAMLINFIN) | 9.9% | 11.1% | 17.8% | 24.2% | |
| Plastiblends India ($PLASTIBLEN) | 19.4% | 18.3% | 15.8% | 24.0% | |
| Keltech Energies ($KELENRG) | 11.5% | 15.3% | 12.8% | 23.0% | |
| |
|---|
| Median (35 companies) | 14.8% | 14.7% | 14.8% | 11.2% | 17.1% |
|---|
| Adi Finechem ($ADIFINCHM) | 27.6% | 30.6% | 29.8% | 46.4% | 26.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cochin Minerals & Rutile ($COCHINM) | 0.7x | -0.0x | -0.0x | 32.3x | |
| Alkali Metals ($ALKALI) | 4.3x | | 5.1x | 11.6x | |
| Kiri Industries ($KIRIINDUS) | 3.9x | 8.2x | 31.3x | 10.6x | |
| Vikas Globalone ($VIKASGLOB) | 0.0x | 2.5x | 4.4x | 4.9x | |
| Jayant Agro-Organics ($JAYAGROGN) | 3.9x | 2.8x | 3.1x | 4.6x | |
| |
|---|
| Median (28 companies) | 1.5x | 1.5x | 1.7x | 1.7x | 0.0x |
|---|
| Adi Finechem ($ADIFINCHM) | 1.3x | 1.4x | 1.0x | 0.9x | 1.1x |
