Kajaria Ceramics demonstrated fast growth over the last few years. Will the growth continue?
06-05-2015 • About Kajaria Ceramics (
$KAJARIACER) • By InTwits
Kajaria Ceramics is a growth stock in Furniture-Furnishing-Paints industry. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Kajaria Ceramics showed fast growth in the last financial year. The company's revenue surged on 19.1% in FY2015. Together with revenue growth Kajaria Ceramics also managed to keep EBITDA growth. EBITDA grew 24.2% for the same period.
If we look for the longer period Kajaria Ceramics showed fast revenue growth of 18.5% from FY2012 to FY2015 annually. EBITDA surged on 19.5% from FY2012 to FY2015 annually.
Kajaria Ceramics ($KAJARIACER) financials for the last 5 years
| mln. INR | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Revenue | 9,532 | 13,130 | 16,120 | 18,363 | 21,869 |
|---|
| Revenue growth, % | | 37.7% | 22.8% | 13.9% | 19.1% |
|---|
| SG&A, % | | | | | |
|---|
| EBITDA | 1,502 | 2,081 | 2,467 | 2,862 | 3,555 |
|---|
| EBITDA growth, % | | 38.6% | 18.5% | 16.0% | 24.2% |
|---|
| EBITDA margin, % | 15.8% | 15.8% | 15.3% | 15.6% | 16.3% |
|---|
| Net Income | 606 | 809 | 1,045 | 1,242 | 1,756 |
|---|
| Net Income margin, % | 6.36% | 6.16% | 6.48% | 6.76% | 8.03% |
|---|
| |
| CAPEX | 1,668 | 751 | 1,543 | 1,568 | 2,696 |
|---|
| CAPEX/Revenue, % | 17.5% | 5.72% | 9.57% | 8.54% | 12.3% |
|---|
| Debt | 2,880 | 2,782 | 3,202 | 2,364 | 2,434 |
|---|
| Cash | 34 | 8 | 6 | 51 | 98 |
|---|
| Net Debt/EBITDA | 1.9x | 1.3x | 1.3x | 0.8x | 0.7x |
|---|
| |
| ROIC, % | | 27.9% | 28.6% | 28.8% | 29.8% |
|---|
| ROE, % | | 32.1% | 32.5% | 27.9% | 27.6% |
|---|
Profitability and return on investment
EBITDA growth was partly attributed to margin expansion. Kajaria Ceramics's EBITDA margin increased slightly on 0.700 pp from 15.6% to 16.3% in FY2015. In the last 3 years EBITDA margin increased slightly on 0.500 pp from 15.8% in FY2012 to 16.3% in FY2015.
Kajaria Ceramics shows attractive ROIC at 29.8% for the last 12 months which assumes stable development model. During the last three years it increased - it was 27.9% in FY2012. It's average level of ROIC for the last three years was 29.1%.
Kajaria Ceramics's Net Income margin surged on 1.20 pp from 6.80% to 8% in FY2015. If we look for the longer period Kajaria Ceramics's Net Income margin surged on 1.80 pp from 6.20% in FY2012 to 8% in FY2015.
Kajaria Ceramics operates at ROE of 27.6%. For the last three years the average ROE was 29.4%.
Capital expenditures (CAPEX)
To fuel this fast growth the company had to invest in CAPEX.The company's CAPEX/Revenue was 12.3% in FY2015. CAPEX/Revenue surged on 6.61 pp from 5.72% in FY2012 to 12.3% in FY2015. It's average level of CAPEX/Revenue for the last three years was 10.1%.
Leverage (Debt)
Kajaria Ceramics has low debt level at 0.7x Net Debt/EBITDA - at the same time with high growth. In the longer period the company showed big decline in leverage of 0.68x from 1.33x in FY2012 to 0.66x in FY2015.
Peers in Furniture-Furnishing-Paints
Below we provide Kajaria Ceramics benchmarking against other companies in Furniture-Furnishing-Paints 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, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Asian Paints ($ASIANPAINT) | -62.1% | 24.8% | 13.3% | 15.7% | |
| Murudeshwar Ceramics ($MURUDCERA) | 10.1% | 3.6% | -19.5% | 1.3% | |
| Nitco ($NITCO) | -33.7% | 31.0% | -8.1% | 0.1% | |
| Shalimar Paints ($SHALPAINTS) | -21.8% | 19.5% | 2.5% | -3.2% | |
| Hanung Toys & Textiles ($HANUNG) | 630.6% | 24.6% | 27.6% | -73.8% | |
| |
|---|
| Median (5 companies) | -21.8% | 24.6% | 2.5% | 0.1% | |
|---|
| Kajaria Ceramics ($KAJARIACER) | | 37.7% | 22.8% | 13.9% | 19.1% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top |
|---|
| Murudeshwar Ceramics ($MURUDCERA) | 30.6% | 23.6% | 21.8% | 21.6% | |
| Asian Paints ($ASIANPAINT) | 17.3% | 16.0% | 16.0% | 16.0% | |
| Shalimar Paints ($SHALPAINTS) | 7.2% | 7.8% | 7.6% | 3.0% | |
| Hanung Toys & Textiles ($HANUNG) | 21.2% | 21.7% | 20.0% | -83.2% | |
| |
|---|
| Median (4 companies) | 17.3% | 16.0% | 16.0% | 9.5% | |
|---|
| Kajaria Ceramics ($KAJARIACER) | 15.8% | 15.8% | 15.3% | 15.6% | 16.3% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top |
|---|
| Shalimar Paints ($SHALPAINTS) | 1.3% | 0.7% | 2.1% | 2.8% | |
| Asian Paints ($ASIANPAINT) | 2.0% | 5.7% | 5.9% | 2.0% | |
| |
|---|
| Median (2 companies) | 5.9% | 5.7% | 5.8% | 2.4% | |
|---|
| Kajaria Ceramics ($KAJARIACER) | 17.5% | 5.7% | 9.6% | 8.5% | 12.3% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Asian Paints ($ASIANPAINT) | 50.4% | 47.1% | 43.0% | 39.8% | |
| Shalimar Paints ($SHALPAINTS) | 23.6% | 25.9% | 22.2% | 6.2% | |
| Hanung Toys & Textiles ($HANUNG) | 17.2% | 15.6% | 13.6% | -18.4% | |
| Bil Continental ($BILCONTI) | | | 4.4% | | |
| Neycer India ($NEYCERI) | | | -6.5% | | |
| |
|---|
| Median (10 companies) | 15.0% | 10.7% | 4.7% | 6.2% | |
|---|
| Kajaria Ceramics ($KAJARIACER) | | 27.9% | 28.6% | 28.8% | 29.8% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top |
|---|
| Shalimar Paints ($SHALPAINTS) | 1.7x | 1.5x | 1.9x | 7.3x | |
| Asian Paints ($ASIANPAINT) | 0.1x | 0.1x | -0.0x | 0.0x | |
| Bil Continental ($BILCONTI) | | 7.9x | 7.0x | 0.0x | |
| Murudeshwar Ceramics ($MURUDCERA) | 2.6x | 3.2x | 4.1x | 0.0x | |
| |
|---|
| Median (4 companies) | 3.3x | 6.2x | 4.3x | 0.0x | |
|---|
| Kajaria Ceramics ($KAJARIACER) | 1.9x | 1.3x | 1.3x | 0.8x | 0.7x |
