Mahindra Holidays & Resorts India EBITDA dropped on 24.7% in 2015 and EBITDA Margin decreased on 3.6 pp from 19.7% to 16.1%
18-05-2015 • About Mahindra Holidays & Resorts India (
$MHRIL) • By InTwits
Mahindra Holidays & Resorts India reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Mahindra Holidays & Resorts India is a company in decline: FY2015 revenue growth was -8.0%, 5 years revenue CAGR was -3.1%
- Mahindra Holidays & Resorts India has high CAPEX intensity: 5 year average CAPEX/Revenue was 21.2%. At the same time it's a lot of higher than industry average of 12.6%.
- CAPEX is quite volatile: 261 in FY2015, 79.9 in FY2014, 252 in FY2013, 729 in FY2012, 643 in FY2011
- The company has potentially unprofitable business model: ROIC is at 6.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Mahindra Holidays & Resorts India ($MHRIL) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,004 | 5,781 | 7,386 | 8,164 | 7,509 | -8.0% |
| EBITDA | 1,264 | 1,005 | 1,688 | 1,605 | 1,209 | -24.7% |
| Net Income | 1,003 | 1,023 | 909 | 870 | 812 | -6.7% |
Balance Sheet
|
|---|
| Cash | 637 | 150 | 421 | 451 | 187 | -58.6% |
| Short Term Debt | 31 | 23 | 36 | 29 | 64 | 117.6% |
| Long Term Debt | 72 | 66 | 54 | 0 | 1,174 | 577,376.9% |
Cash flow
|
|---|
| Capex | 1,021 | 1,501 | 1,957 | 1,256 | 1,350 | 7.4% |
Ratios
|
|---|
| Revenue growth | -43.2% | 15.5% | 27.8% | 10.5% | -8.0% | |
| EBITDA growth | -18.1% | -20.4% | 67.9% | -4.9% | -24.7% | |
| EBITDA Margin | 25.3% | 17.4% | 22.9% | 19.7% | 16.1% | -3.6% |
| Net Income Margin | 20.1% | 17.7% | 12.3% | 10.7% | 10.8% | 0.2% |
| CAPEX, % of revenue | 20.4% | 26.0% | 26.5% | 15.4% | 18.0% | 2.6% |
| ROIC | 20.1% | 13.4% | 22.2% | 16.3% | 6.3% | -10.0% |
| ROE | 21.4% | 19.2% | 15.5% | 12.7% | 10.9% | -1.7% |
| Net Debt/EBITDA | -0.4x | -0.1x | -0.2x | -0.3x | 0.9x | 1.1x |
Revenue and profitability
The company's Revenue decreased on 8.0% in FY2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 3.6 pp from 19.7% to 16.1% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Mahindra Holidays & Resorts India had CAPEX/Revenue of 18.0%. The company's CAPEX/Revenue decreased on 8.0 pp from 26.0% in FY2012 to 18.0% in FY2015. Average CAPEX/Revenue for the last three years was 20.0%.The company has spent a lot to CAPEX (112% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (6.29%) and ROE (10.93%). ROIC decreased on 10.0 pp from 16.3% to 6.3% in FY2015. ROE decreased slightly on 1.7 pp from 12.7% to 10.9% in FY2015.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 1.0x Debt / EBITDA. Net Debt / EBITDA jumped on 1.1x from -0.3x to 0.9x in FY2015. Debt surged on 4,072% in FY2015 while cash dropped on 58.6% in FY2015.
Valuation
The company's trades at EV/EBITDA 19.2x and P/E 27.3x while industy averages are 10.5x and 26.1x.
Management team
Kavinder Singh is a the company's CEO. Kavinder Singh has spent 4 years at the company. The company's CFO is S Krishnan. S Krishnan has 3 years tenure at the company.
Appendix 1: Peers in Hotels
Below we provide Mahindra Holidays & Resorts India benchmarking against other companies in Hotels 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 |
|---|
| The Byke Hospitality ($THEBYKE) | -83.8% | 47.6% | 105.7% | 54.3% | |
| Sayaji Hotels ($SAYAJIHOTL) | 26.3% | 18.2% | 24.5% | 29.4% | |
| Sterling Holiday Resorts (India) ($STERLINH) | | 69.9% | 50.6% | 21.3% | 26.2% |
| Asian Hotels (East) ($AHLEAST) | -62.1% | 3.4% | 76.9% | 18.9% | |
| Hotel Leelaventure ($HOTELEELA) | -39.6% | 23.2% | 12.7% | 11.4% | |
| |
|---|
| Median (15 companies) | -27.9% | 14.9% | 8.6% | 5.5% | 26.2% |
|---|
| Mahindra Holidays & Resorts India ($MHRIL) | | 15.5% | 27.8% | 10.5% | -8.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asian Hotels (North) ($ASIANHOTNR) | 36.6% | 10.8% | 22.9% | 26.9% | |
| Kamat Hotels (India) ($KAMATHOTEL) | 31.9% | 29.7% | 22.1% | 26.7% | |
| Tgb Banquets And Hotels ($TGBHOTELS) | 20.0% | 21.2% | 23.6% | 25.0% | |
| Country Club (India) ($COUNCLB) | 31.8% | 34.2% | 32.3% | 24.2% | |
| Royale Manor Hotels & Industries ($RAYALEMA) | 24.1% | 36.3% | 23.5% | 23.2% | |
| |
|---|
| Median (14 companies) | 25.3% | 21.9% | 22.6% | 21.0% | 21.3% |
|---|
| Mahindra Holidays & Resorts India ($MHRIL) | 25.3% | 17.4% | 22.9% | 19.7% | 16.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Country Club (India) ($COUNCLB) | 53.8% | 58.7% | 36.6% | 49.6% | |
| Asian Hotels (North) ($ASIANHOTNR) | 60.3% | 30.8% | 60.2% | 37.2% | |
| Sterling Holiday Resorts (India) ($STERLINH) | 12.2% | 48.8% | 50.4% | 18.7% | |
| Oriental Hotels ($ORIENTHOT) | 31.7% | 24.3% | 17.7% | 13.1% | 7.5% |
| Sayaji Hotels ($SAYAJIHOTL) | 7.5% | 18.9% | 17.5% | 12.4% | |
| |
|---|
| Median (12 companies) | 27.3% | 30.8% | 17.6% | 8.8% | 6.1% |
|---|
| Mahindra Holidays & Resorts India ($MHRIL) | 20.4% | 26.0% | 26.5% | 15.4% | 18.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| The Byke Hospitality ($THEBYKE) | 6.0% | 5.3% | 14.5% | 22.6% | |
| Sayaji Hotels ($SAYAJIHOTL) | 10.2% | 13.1% | 9.4% | 14.2% | |
| Fomento Resorts & Hotels ($FOMEHOT) | 13.6% | 10.6% | 13.8% | 11.7% | |
| Tgb Banquets And Hotels ($TGBHOTELS) | 7.4% | 7.1% | 8.9% | 8.9% | |
| Eih ($EIHOTEL) | 4.5% | 5.5% | 4.5% | 5.8% | |
| |
|---|
| Median (29 companies) | 7.6% | 5.4% | 4.7% | 2.8% | 3.8% |
|---|
| Mahindra Holidays & Resorts India ($MHRIL) | 20.1% | 13.4% | 22.2% | 16.3% | 6.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hotel Leelaventure ($HOTELEELA) | 23.9x | 62.5x | 40.2x | 33.5x | |
| Asian Hotels (North) ($ASIANHOTNR) | 9.1x | 28.4x | 11.0x | 15.4x | |
| Kamat Hotels (India) ($KAMATHOTEL) | 15.0x | 13.6x | 17.8x | 15.1x | |
| Asian Hotels (East) ($AHLEAST) | -0.1x | -0.0x | 9.8x | 8.9x | |
| Oriental Hotels ($ORIENTHOT) | 3.4x | 4.3x | 4.6x | 6.0x | 5.5x |
| |
|---|
| Median (19 companies) | 2.2x | 2.0x | 2.3x | 1.0x | 0.0x |
|---|
| Mahindra Holidays & Resorts India ($MHRIL) | -0.4x | -0.1x | -0.2x | -0.3x | 0.9x |
