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Ion Exchange (India) reports 36.9% EBITDA growth and 0.94% Revenue growth

25-05-2015 • About Ion Exchange (India) ($IONEXCHANG) • By InTwits

Ion Exchange (India) reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
  • EBITDA Margin is quite volatile: 5.8% in FY2015, 4.3% in FY2014, 5.8% in FY2013, 4.4% in FY2012, -2.5% in FY2011
  • Ion Exchange (India) has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 4.5%.
  • CAPEX is quite volatile: 173 in FY2015, 73.0 in FY2014, 178 in FY2013, 194 in FY2012, 98.1 in FY2011
  • The company has highly profitable business model: ROIC is at 13.1%
  • It operates with high leverage: Net Debt/EBITDA is 1.6x while industry average is 0.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

Ion Exchange (India) ($IONEXCHANG) key annual financial indicators

mln. INR201120122013201420152015/2014
P&L
Revenue5,7147,2288,5737,9308,0050.9%
EBITDA-14131749334146736.9%
Net Income84961414698114.4%
Balance Sheet
Cash1681001391161236.2%
Short Term Debt358578744847661-21.9%
Long Term Debt8311111411120282.4%
Cash flow
Capex9819417873173136.5%
Ratios
Revenue growth-38.2%26.5%18.6%-7.5%0.9%
EBITDA growth-149.3%-325.0%55.7%-30.8%36.9%
EBITDA Margin-2.5%4.4%5.8%4.3%5.8%1.5%
Net Income Margin1.5%1.3%1.7%0.6%1.2%0.6%
CAPEX, % of revenue1.7%2.7%2.1%0.9%2.2%1.2%
ROIC-10.6%11.0%15.1%8.8%13.1%4.3%
ROE6.6%7.2%9.8%3.0%6.3%3.3%
Net Debt/EBITDA1.9x1.5x2.5x1.6x-0.9x

Revenue and profitability


The company's Revenue increased slightly on 0.94% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.7 pp from 54.6% to 50.9% in FY2015.

Net Income marign increased slightly on 0.65 pp from 0.57% to 1.2% in FY2015.

Capital expenditures (CAPEX) and working capital investments


In FY2015 Ion Exchange (India) had CAPEX/Revenue of 2.2%. CAPEX/Revenue decreased slightly on 0.52 pp from 2.7% in FY2012 to 2.2% in FY2015. For the last three years the average CAPEX/Revenue was 1.7%.

Return on investment


The company operates at good ROIC (13.13%) while ROE is low (6.33%). ROIC increased on 4.3 pp from 8.8% to 13.1% in FY2015. ROE increased on 3.3 pp from 3.0% to 6.3% in FY2015.

Leverage (Debt)


Debt level is 1.6x Net Debt / EBITDA and 1.8x Debt / EBITDA. Net Debt / EBITDA dropped on 0.9x from 2.5x to 1.6x in FY2015. Debt decreased on 9.8% in FY2015 while cash increased on 6.2% in FY2015.

Appendix 1: Peers in Industrial Machinery


Below we provide Ion Exchange (India) benchmarking against other companies in Industrial Machinery 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
Forbes & Company ($FORBESCO)-66.3%22.4%13.0%53.4%
Nitin Fire Protection Industries ($NITINFIRE)22.3%31.5%44.2%12.2%
Gmm Pfaudler ($GMM)-26.1%47.8%31.0%10.3%
Kabra Extrusiontechnik ($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)-7.1%14.1%2.1%4.0%11.3%
Ion Exchange (India) ($IONEXCHANG)26.5%18.6%-7.5%0.9%


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
Texmaco Infrastructure & Holdings ($TEXINFRA)40.5%
Dhp India ($DHPIND)26.3%
Solitaire Machine Tools ($SOLIMAC)19.4%
Wendt (India) ($WENDT)30.8%28.3%21.6%18.6%19.0%
Goldstone Infratech ($GOLDINFRA)18.1%
 
Median (21 companies)14.0%11.2%9.6%10.5%11.1%
Ion Exchange (India) ($IONEXCHANG)-2.5%4.4%5.8%4.3%5.8%


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%4.3%
 
Median (19 companies)3.9%5.8%4.1%3.0%4.6%
Ion Exchange (India) ($IONEXCHANG)1.7%2.7%2.1%0.9%2.2%


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%18.2%
Greaves Cotton ($GREAVESCOT)24.8%16.3%26.7%
Lakshmi Machine Works ($LAXMIMACH)16.8%18.0%11.7%16.2%17.6%
Wendt (India) ($WENDT)38.2%20.2%16.2%15.1%
 
Median (51 companies)15.2%13.1%10.2%9.7%12.1%
Ion Exchange (India) ($IONEXCHANG)-10.6%11.0%15.1%8.8%13.1%


Top companies by Net Debt / EBITDA

Top 5 FY2011 FY2012 FY2013 FY2014 FY2015
Chemtech Industrial Valves ($CHEMTECH)7.7x6.4x5.3x8.8x
Forbes & Company ($FORBESCO)3.5x2.2x3.3x4.7x
Lokesh Machines ($LOKESHMACH)4.0x3.7x3.3x4.6x
Elecon Engineering Co ($ELECON)3.1x3.0x3.2x4.0x3.1x
Lloyd Electric & Engineering ($LLOYDELENG)4.0x3.2x3.0x3.7x
 
Median (34 companies)1.2x0.6x1.7x0.0x0.0x
Ion Exchange (India) ($IONEXCHANG)1.9x1.5x2.5x1.6x


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