Umang Dairies's revenue growth was 18.7% annually over the last three years
20-05-2015 • About Umang Dairies (
$UMANGDAIR) • By InTwits
Pay attention to Umang Dairies as a growth stock. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
Umang Dairies showed fast growth in the last financial year. Umang Dairies's revenue surged on 16.1% in FY2015. The growth also happened in EBITDA of 57.6% for the same period.
If we look for the longer period the company showed fast revenue growth of 18.7% from FY2012 to FY2015 annually. EBITDA increased on 2.11% from FY2012 to FY2015 annually.
Umang Dairies ($UMANGDAIR) financials for the last 5 years
| mln. INR | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Revenue | 1,023 | 1,502 | 1,738 | 2,164 | 2,511 |
|---|
| Revenue growth, % | | 46.8% | 15.7% | 24.5% | 16.1% |
|---|
| SG&A, % | | | | | |
|---|
| EBITDA | 52 | 155 | 177 | 105 | 165 |
|---|
| EBITDA growth, % | | 200.1% | 14.1% | -40.8% | 57.6% |
|---|
| EBITDA margin, % | 5.06% | 10.3% | 10.2% | 4.85% | 6.59% |
|---|
| Net Income | 33 | 138 | 123 | 60 | 85 |
|---|
| Net Income margin, % | 3.24% | 9.21% | 7.08% | 2.75% | 3.39% |
|---|
| |
| CAPEX | 12 | 30 | 76 | 59 | 81 |
|---|
| CAPEX/Revenue, % | 1.19% | 2.01% | 4.38% | 2.73% | 3.21% |
|---|
| Debt | 107 | 104 | 85 | 185 | 185 |
|---|
| Cash | 15 | 4 | 5 | 8 | 5 |
|---|
| Net Debt/EBITDA | 1.8x | 0.6x | 0.5x | 1.7x | 1.1x |
|---|
| |
| ROIC, % | 54.8% | 93.5% | 55.6% | 22.3% | 28.4% |
|---|
| ROE, % | | | 96.4% | 30.4% | 35.2% |
|---|
Profitability and return on investment
EBITDA growth was supported by margin expansion. The company showed fast EBITDA margin growth of 1.70 pp from 4.90% to 6.60% in FY2015. In the longer period the company's EBITDA margin dropped on 3.70 pp from 10.3% in FY2012 to 6.60% in FY2015.
We call Umang Dairies an attractive growth stock as together with the growth it delivers high ROIC at 28.4%. Three years ago it was considerably higher at 93.5%. Average ROIC for the last three years was 35.4%.
Umang Dairies showed fast Net Income margin growth of 0.600 pp from 2.80% to 3.40% in FY2015. In the longer period the company's Net Income margin dropped on 5.80 pp from 9.20% in FY2012 to 3.40% in FY2015.
Umang Dairies operates at ROE of 35.2%. It's average level of ROE for the last three years was 54.0%.
Capital expenditures (CAPEX)
In FY2015 the company had CAPEX/Revenue of 3.21%. CAPEX/Revenue surged on 1.20 pp from 2.01% in FY2012 to 3.21% in FY2015. Average CAPEX/Revenue for the last three years was 3.44%.
Leverage (Debt)
The company has medium debt level at 1.1x Net Debt/EBITDA to maintain high growth. If we look for the longer period Umang Dairies's leverage surged on 0.45x from 0.64x in FY2012 to 1.09x in FY2015.
Valuation vs. comparable companies
At the end of trading day today Umang Dairies traded at 9.0x EV/EBITDA which is 35.3% lower than 13.9x Packaged Foods peer group avearge calculated on the basis of 72 companies. The company trades at 15.4x P/E which is 75.3% lower than 62.3x Packaged Foods industry avearge calculated based on 10 companies.
For capital intensive compnanies it's worth taking a look at EV/(EBITDA-CAPEX) multiple. At the end of trading day today Umang Dairies traded at 17.6x EV/(EBITDA-CAPEX) which is 66.6% lower than 52.5x Packaged Foods peer group avearge calculated on the basis of 8 companies.
Peers in Packaged Foods
Below we provide Umang Dairies benchmarking against other companies in Packaged Foods 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 |
|---|
| Krbl ($KRBL) | -2.2% | 5.6% | 27.6% | 39.9% | |
| Sunil Agro Foods ($SUNILAGR) | -34.2% | 1.6% | 38.3% | 29.1% | |
| Milkfood ($MLKFOOD) | -29.8% | -1.1% | 9.3% | 27.7% | |
| Simran Farms ($SIMRAN) | -69.5% | 38.4% | 23.8% | 27.5% | |
| Venky'S (India) ($VENKYS) | -61.1% | 18.0% | 46.0% | 24.8% | |
| |
|---|
| Median (15 companies) | -37.0% | 14.7% | 14.8% | 15.7% | 9.6% |
|---|
| Umang Dairies ($UMANGDAIR) | | 46.8% | 15.7% | 24.5% | 16.1% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Glaxosmithkline Consumer Healthcare ($GSKCONS) | 18.8% | 18.6% | 17.8% | 22.5% | 17.2% |
| Nestle India ($NESTLEIND) | 20.5% | 22.0% | 21.7% | 20.9% | |
| Krbl ($KRBL) | 14.7% | 14.1% | 14.2% | 15.1% | |
| Vadilal Industries ($VADILALIND) | 10.1% | 19.8% | 11.6% | 11.2% | |
| Britannia Industries ($BRITANNIA) | 5.2% | 5.7% | 6.9% | 9.2% | |
| |
|---|
| Median (12 companies) | 7.7% | 7.2% | 7.1% | 8.7% | 17.2% |
|---|
| Umang Dairies ($UMANGDAIR) | 5.1% | 10.3% | 10.2% | 4.9% | 6.6% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Venky'S (India) ($VENKYS) | 6.4% | 8.9% | 6.6% | 10.4% | |
| Krbl ($KRBL) | 5.8% | 4.1% | 4.0% | 6.1% | |
| Vadilal Industries ($VADILALIND) | 20.1% | 12.2% | 9.4% | 5.9% | |
| Adf Foods ($ADFFOODS) | 21.8% | 1.9% | 18.3% | 5.8% | |
| Glaxosmithkline Consumer Healthcare ($GSKCONS) | 3.6% | 2.7% | | 4.3% | 2.5% |
| |
|---|
| Median (9 companies) | 3.6% | 4.1% | 3.9% | 4.3% | 2.5% |
|---|
| Umang Dairies ($UMANGDAIR) | 1.2% | 2.0% | 4.4% | 2.7% | 3.2% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Britannia Industries ($BRITANNIA) | 17.8% | 24.6% | 33.7% | 54.0% | |
| Nestle India ($NESTLEIND) | 85.4% | 57.7% | 47.9% | 49.6% | |
| Kse ($KSE) | 14.7% | 27.7% | 14.1% | 36.9% | |
| Heritage Foods ($HERITGFOOD) | 5.9% | 11.7% | 29.6% | 22.4% | |
| Krbl ($KRBL) | 14.4% | 11.7% | 14.5% | 18.3% | |
| |
|---|
| Median (19 companies) | 11.3% | 12.1% | 10.9% | 20.3% | 36.2% |
|---|
| Umang Dairies ($UMANGDAIR) | 54.8% | 93.5% | 55.6% | 22.3% | 28.4% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Venky'S (India) ($VENKYS) | 0.9x | 2.6x | 2.8x | 6.7x | |
| Vadilal Industries ($VADILALIND) | 5.8x | 2.6x | 4.5x | 3.9x | |
| Bambino Agro Industries ($BAMBINO) | 3.1x | 3.2x | | 3.2x | |
| Krbl ($KRBL) | 3.7x | 4.1x | 2.9x | 3.0x | |
| Adf Foods ($ADFFOODS) | 1.5x | 1.6x | 1.7x | 1.2x | |
| |
|---|
| Median (12 companies) | 2.3x | 1.9x | 1.3x | 0.7x | -3.1x |
|---|
| Umang Dairies ($UMANGDAIR) | 1.8x | 0.6x | 0.5x | 1.7x | 1.1x |
