Ingersoll-Rand (India) CAPEX surged on 190% in 2015 and Revenue jumped on 13.3%
12-05-2015 • About Ingersoll-Rand (India) (
$INGERRAND) • By InTwits
Ingersoll-Rand (India) reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 6.8% in FY2015 vs. 7.9% in FY2014 vs. 12.5% in FY2011
- Ingersoll-Rand (India) has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.9%. At the same time it's a lot of higher than industry average of 4.2%.
- CAPEX is quite volatile: 602 in FY2015, 208 in FY2014, 638 in FY2013, 253 in FY2012, 65.5 in FY2011
- The company has potentially unprofitable business model: ROIC is at 3.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ingersoll-Rand (India) ($INGERRAND) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4,927 | 5,920 | 5,856 | 5,787 | 6,555 | 13.3% |
| EBITDA | 615 | 705 | 563 | 455 | 445 | -2.2% |
| Net Income | 686 | 828 | 779 | 670 | 661 | -1.2% |
Balance Sheet
|
|---|
| Cash | 122 | 172 | 2,819 | 2,259 | 2,271 | 0.5% |
| Short Term Debt | 0 | 205 | 0 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 66 | 253 | 638 | 208 | 602 | 189.6% |
Ratios
|
|---|
| Revenue growth | -37.3% | 20.1% | -1.1% | -1.2% | 13.3% | |
| EBITDA growth | 34.2% | 14.7% | -20.2% | -19.1% | -2.2% | |
| EBITDA Margin | 12.5% | 11.9% | 9.6% | 7.9% | 6.8% | -1.1% |
| Net Income Margin | 13.9% | 14.0% | 13.3% | 11.6% | 10.1% | -1.5% |
| CAPEX, % of revenue | 1.3% | 4.3% | 10.9% | 3.6% | 9.2% | 5.6% |
| ROIC | 7.1% | 7.9% | 6.0% | 4.2% | 3.5% | -0.7% |
| ROE | 8.6% | 10.1% | 9.3% | 7.5% | 7.1% | -0.4% |
| Net Debt/EBITDA | -0.2x | 0.0x | -5.0x | -5.0x | -5.1x | -0.1x |
Revenue and profitability
Ingersoll-Rand (India)'s Revenue jumped on 13.3% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 9.8 pp from 7.0% to 16.9% in FY2015.
Net Income marign decreased slightly on 1.5 pp from 11.6% to 10.1% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Ingersoll-Rand (India) had CAPEX/Revenue of 9.2%. Ingersoll-Rand (India)'s CAPEX/Revenue increased on 4.9 pp from 4.3% in FY2012 to 9.2% in FY2015. Average CAPEX/Revenue for the last three years was 7.9%.To fuel this fast growth the company made large investments to CAPEX (135% of EBITDA).
Return on investment
The company operates at low ROIC (3.51%) and ROE (7.07%). ROIC decreased slightly on 0.67 pp from 4.2% to 3.5% in FY2015. ROE showed almost no change in FY2015.
Leverage (Debt)
The company has no debt. Cash showed almost no change in FY2015.
Valuation
The company's trades at EV/EBITDA 60.4x and P/E 44.1x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Industrial Machinery
Below you can find Ingersoll-Rand (India) benchmarking vs. other companies in Industrial Machinery 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 |
|---|
| Forbes & Company ($FORBESCO) | -66.3% | 22.4% | 13.0% | 53.4% | |
| Nitin Fire Protection Industries ($NITINFIRE) | -67.4% | 22.3% | 31.5% | 44.2% | |
| Gmm Pfaudler ($GMM) | -47.2% | -26.1% | 47.8% | 31.0% | |
| Kabra Extrusiontechnik ($KABRAEXTRU) | -32.6% | -13.3% | -8.7% | 28.4% | |
| Veejay Lakshmi Engineering Works ($VJLAXMIE) | 27.9% | -28.8% | 5.7% | 26.6% | |
| |
|---|
| Median (26 companies) | -34.3% | 14.1% | 2.3% | 4.0% | 2.1% |
|---|
| Ingersoll-Rand (India) ($INGERRAND) | | 20.1% | -1.1% | -1.2% | 13.3% |
Top companies by Gross margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Bell Agromachina ($BELAGRO) | | 0.0% | 0.0% | 0.0% | 0.0% |
| |
|---|
| Median (1 company) | | 0.0% | 0.0% | 0.0% | 0.0% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lokesh Machines ($LOKESHMACH) | 14.7% | 18.9% | 21.9% | 24.0% | |
| Wendt (India) ($WENDT) | 30.8% | 28.3% | 21.6% | 18.6% | 19.0% |
| Mazda ($MAZDALTD) | 14.4% | 14.5% | 16.2% | 15.0% | |
| Ksb Pumps ($KSBPUMPS) | 9.9% | 13.1% | 14.1% | 12.6% | |
| Abc Bearings ($ABCBEARS) | 22.6% | 16.5% | 12.9% | 12.1% | 13.3% |
| |
|---|
| Median (22 companies) | 14.0% | 10.7% | 9.4% | 10.5% | 11.0% |
|---|
| Ingersoll-Rand (India) ($INGERRAND) | 12.5% | 11.9% | 9.6% | 7.9% | 6.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lokesh Machines ($LOKESHMACH) | 18.5% | 22.1% | | 12.9% | |
| Elgi Equipments ($ELGIEQUIP) | 2.8% | 4.0% | 24.0% | 9.8% | |
| Wendt (India) ($WENDT) | 7.2% | 13.5% | 9.0% | 8.8% | 9.4% |
| Ksb Pumps ($KSBPUMPS) | 3.3% | 7.5% | 3.5% | 5.0% | |
| Honda Siel Power Products ($HONDAPOWER) | 4.3% | 6.7% | 8.0% | 3.7% | |
| |
|---|
| Median (19 companies) | 3.9% | 5.8% | 3.7% | 2.7% | 4.1% |
|---|
| Ingersoll-Rand (India) ($INGERRAND) | 1.3% | 4.3% | 10.9% | 3.6% | 9.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rexnord Electronics & Controls ($REXNORD) | 10.4% | | | 18.8% | |
| Gmm Pfaudler ($GMM) | 14.2% | -76.2% | 6.8% | 17.4% | |
| Greaves Cotton ($GREAVESCOT) | | | 24.8% | 16.3% | 26.7% |
| Lakshmi Machine Works ($LAXMIMACH) | 16.8% | 18.0% | 11.7% | 16.2% | |
| Wendt (India) ($WENDT) | | 38.2% | 20.2% | 16.2% | 15.1% |
| |
|---|
| Median (51 companies) | 15.2% | 13.1% | 10.9% | 9.7% | 8.2% |
|---|
| Ingersoll-Rand (India) ($INGERRAND) | 7.1% | 7.9% | 6.0% | 4.2% | 3.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chemtech Industrial Valves ($CHEMTECH) | 7.7x | 6.4x | 5.3x | 8.8x | |
| Forbes & Company ($FORBESCO) | 3.5x | 2.2x | 3.3x | 4.7x | |
| Lokesh Machines ($LOKESHMACH) | 4.0x | 3.7x | 3.3x | 4.6x | |
| Elecon Engineering Co ($ELECON) | 3.1x | 3.0x | 3.2x | 4.0x | 3.1x |
| Lloyd Electric & Engineering ($LLOYDELENG) | 4.0x | 3.2x | 3.0x | 3.7x | |
| |
|---|
| Median (34 companies) | 1.3x | 1.1x | 1.7x | 0.0x | 0.0x |
|---|
| Ingersoll-Rand (India) ($INGERRAND) | -0.2x | 0.0x | -5.0x | -5.0x | -5.1x |
