Tara Jewels Debt increased on 6.2% in 2015 and EBITDA increased slightly on 1.9%

26-05-2015 • About Tara Jewels ($TARAJEWELS) • By InTwits

Tara Jewels reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:

EBITDA Margin is relatively stable: 9.1% in FY2015 vs. 9.2% in FY2014 vs. 8.5% in FY2011
The company has highly profitable business model: ROIC is at 13.5%

Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

Tara Jewels ($TARAJEWELS) key annual financial indicators

mln. INR	2011	2012	2013	2014	2015	2015/2014
P&L
Revenue	11,423	13,991	16,355	16,954	17,353	2.4%
EBITDA	971	1,287	1,495	1,556	1,586	1.9%
Net Income	407	539	737	504	437	-13.3%
Balance Sheet
Cash	272	223	1,124	710	835	17.5%
Short Term Debt	4,500	3,320	3,242	3,849	4,097	6.4%
Long Term Debt	8	69	63	12	3	-71.4%
Cash flow
Capex	203	222	212	528		-100.0%
Ratios
Revenue growth	-45.4%	22.5%	16.9%	3.7%	2.4%
EBITDA growth	44.9%	32.6%	16.2%	4.1%	1.9%
EBITDA Margin	8.5%	9.2%	9.1%	9.2%	9.1%	-0.0%
Net Income Margin	3.6%	3.9%	4.5%	3.0%	2.5%	-0.5%
CAPEX, % of revenue	1.8%	1.6%	1.3%	3.1%		-3.1%
ROIC	14.8%	17.5%	18.6%	15.1%	13.5%	-1.6%
ROE	20.3%	21.6%	19.1%	9.8%	7.8%	-2.0%
Net Debt/EBITDA	4.4x	2.5x	1.5x	2.0x	2.1x	0.0x

Revenue and profitability

Tara Jewels's Revenue increased on 2.4% in FY2015. EBITDA Margin showed almost no change in FY2015.

Net Income marign showed almost no change in FY2015.

Return on investment

The company operates at good ROIC (13.51%) while ROE is low (7.76%). ROIC decreased slightly on 1.6 pp from 15.1% to 13.5% in FY2015. ROE decreased slightly on 2.0 pp from 9.8% to 7.8% in FY2015.

Leverage (Debt)

Debt level is 2.1x Net Debt / EBITDA and 2.6x Debt / EBITDA. Net Debt / EBITDA increased on 0.035x from 2.0x to 2.1x in FY2015. Debt increased on 6.2% in FY2015 while cash jumped on 17.5% in FY2015.

Valuation

Tara Jewels's trades at EV/EBITDA 3.0x and P/E 3.4x while industy averages are 10.5x and 26.1x.

Appendix 1: Peers in Other Apparels & Accessories

Below you can find Tara Jewels benchmarking vs. other companies in Other Apparels & Accessories 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
Mini Diamonds (India) ($MINID)	-85.8%	35.0%	59.6%	117.1%
Page Industries ($PAGEIND)	-73.3%	39.0%	26.3%	37.5%
Bhartiya International ($BIL)		28.4%	20.9%	36.7%	34.7%
Celebrity Fashions ($CELEBRITY)		1.0%	-8.6%	35.2%	-21.7%
Super Tannery ($SUPTANERY)	-30.0%	-1.4%	0.3%	34.6%
Median (23 companies)	-9.3%	10.1%	19.5%	15.3%	6.4%
Tara Jewels ($TARAJEWELS)		22.5%	16.9%	3.7%	2.4%

Top companies by EBITDA margin, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Arrow Textiles ($ARROWTEX)					25.2%
Rupa & Company ($RUPA)	10.7%	12.7%	15.0%	15.3%	14.5%
Ashapura Intimates Fashion ($AIFL)	8.9%	9.5%	10.5%	10.7%	13.7%
Cantabil Retail India ($CANTABIL)	13.8%	-10.4%	-22.3%		10.4%
Bhartiya International ($BIL)	10.6%	11.4%	9.2%	8.9%	9.5%
Median (15 companies)	8.1%	7.5%	5.5%	5.4%	5.6%
Tara Jewels ($TARAJEWELS)	8.5%	9.2%	9.1%	9.2%	9.1%

Top companies by CAPEX/Revenue, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Page Industries ($PAGEIND)	5.8%	4.0%	5.2%	4.4%
Zodiac Clothing Co ($ZODIACLOTH)	9.3%	5.7%	3.9%	4.0%
Bhartiya International ($BIL)	4.5%	4.5%	3.9%	1.8%	2.1%
Rupa & Company ($RUPA)	4.5%	1.9%	3.9%	1.7%	2.2%
Thangamayil Jewellery ($THANGAMAYL)	1.9%	3.5%	1.2%	1.4%	0.2%
Median (14 companies)	1.9%	1.7%	1.7%	1.1%	0.7%
Tara Jewels ($TARAJEWELS)	1.8%	1.6%	1.3%	3.1%

Top companies by ROIC, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Page Industries ($PAGEIND)	44.2%	54.9%	58.5%	61.6%
Oscar Global ($OSCARGLO)			12.6%	52.3%
Virat Industries ($VIRAT)	13.2%	20.7%	26.2%	30.9%
Rupa & Company ($RUPA)	20.2%	22.4%	27.1%	25.8%	23.8%
Ashapura Intimates Fashion ($AIFL)	21.7%	24.1%	19.1%	23.4%	39.9%
Median (40 companies)	8.8%	9.3%	7.2%	10.9%	7.7%
Tara Jewels ($TARAJEWELS)	14.8%	17.5%	18.6%	15.1%	13.5%

Top companies by Net Debt / EBITDA


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Thangamayil Jewellery ($THANGAMAYL)	2.2x	2.2x	2.6x	11.9x	61.2x
Shrenuj & Co ($SHRENUJ)	8.6x	9.3x	11.2x	11.7x
Pearl Global Industries ($PGIL)	8.4x	4.5x	4.7x	7.0x	2.7x
C. Mahendra Exports ($CMAHENDRA)	4.1x	4.5x	4.9x	6.0x
Asian Star Co ($ASTAR)	8.2x	7.1x	7.1x	5.9x	4.8x
Median (24 companies)	2.7x	2.2x	2.9x	0.0x	2.1x
Tara Jewels ($TARAJEWELS)	4.4x	2.5x	1.5x	2.0x	2.1x

Tara Jewels stock price chart

Tara Jewels financials

mln.	FY2010	FY2011	FY2012

Revenue	20,924	11,423	13,991
EBITDA	669.8	970.6	1,287
Net income	241.1	406.9	538.9
CAPEX	178.6	202.7	221.8
Debt	2,821	4,508	3,390
Cash	260.6	271.8	223.4

About Tara Jewels

Tara Jewels Limited, together with its subsidiaries, designs, manufactures, and retails jewelry primarily in India. Its products include fashion, bridal, and handmade bespoke diamond and gold jewelry. The company also exports its products to retailers in the United States, the United Kingdom, Europe, Australia, China, South Africa, the United Arab Emirates, and Canada. Tara Jewels Limited supplies its products to consumers through national chains, television, Internet, departmental stores, hypermarkets, small chain jewelers, and independent and catalogue jewelers. The Company sells its products through approximately 12000 stores worldwide, including 37 stores in India. Tara Jewels Limited was incorporated in 2001 and is headquartered in Mumbai, India.