India Cements reports 20.9% EBITDA growth and almost no change in Revenue of 50,604
29-05-2015 • About India Cements (
$INDIACEM) • By InTwits
India Cements reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- India Cements has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.8%. At the same time it's in pair with industry average of 12.6%.
- CAPEX is quite volatile: 2,576 in FY2015, 2,427 in FY2014, 5,645 in FY2013, 6,631 in FY2012, 8,639 in FY2011
- The company has potentially unprofitable business model: ROIC is at 6.2%
- It operates with medium-size leverage: Net Debt/EBITDA is 4.6x while industry average is 3.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
India Cements ($INDIACEM) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 36,224 | 46,310 | 51,595 | 50,848 | 50,604 | -0.5% |
| SG&A | 1,696 | 2,135 | 16,121 | 17,379 | 14,018 | -19.3% |
| EBITDA | 4,817 | 9,527 | 9,475 | 6,311 | 7,632 | 20.9% |
| Net Income | 653 | 2,715 | 1,880 | -2,434 | -33 | |
Balance Sheet
|
|---|
| Cash | 491 | 122 | 92 | 60 | 72 | 20.4% |
| Short Term Debt | 8,438 | 12,827 | 11,836 | 12,577 | 10,565 | -16.0% |
| Long Term Debt | 15,131 | 17,519 | 21,321 | 22,407 | 24,454 | 9.1% |
Cash flow
|
|---|
| Capex | 8,639 | 6,631 | 5,645 | 2,427 | 2,576 | 6.1% |
Ratios
|
|---|
| Revenue growth | -38.5% | 27.8% | 11.4% | -1.4% | -0.5% | |
| EBITDA growth | -34.8% | 97.8% | -0.5% | -33.4% | 20.9% | |
| EBITDA Margin | 13.3% | 20.6% | 18.4% | 12.4% | 15.1% | 2.7% |
| Net Income Margin | 1.8% | 5.9% | 3.6% | -4.8% | -0.1% | 4.7% |
| SG&A, % of revenue | 4.7% | 4.6% | 31.2% | 34.2% | 27.7% | -6.5% |
| CAPEX, % of revenue | 23.9% | 14.3% | 10.9% | 4.8% | 5.1% | 0.3% |
| ROIC | 3.5% | 9.5% | 8.3% | 4.1% | 6.2% | 2.1% |
| ROE | 1.6% | 6.8% | 4.7% | -6.4% | -0.1% | 6.3% |
| Net Debt/EBITDA | 4.8x | 3.2x | 3.5x | 5.5x | 4.6x | -1.0x |
Revenue and profitability
The company's Revenue showed almost no change in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.7 pp from 12.4% to 15.1% in FY2015.
SG&A as a % of Revenue decreased on 6.5 pp from 34.2% to 27.7% in FY2015.
Net Income marign increased on 4.7 pp from -4.8% to -0.065% in FY2015.
Capital expenditures (CAPEX) and working capital investments
India Cements's CAPEX/Revenue was 5.1% in FY2015. CAPEX/Revenue decreased on 9.2 pp from 14.3% in FY2012 to 5.1% in FY2015. It's average CAPEX/Revenue for the last three years was 6.9%.
Return on investment
The company operates at low but positive ROIC (6.23%) and negative ROE (-0.09%). ROIC increased on 2.1 pp from 4.1% to 6.2% in FY2015. ROE increased on 6.3 pp from -6.4% to -0.094% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.6x and Debt / EBITDA is 4.6x. Net Debt / EBITDA dropped on 1.0x from 5.5x to 4.6x in FY2015. Debt showed almost no change in FY2015 while cash jumped on 20.4% in FY2015.
Management team
Narayanaswami Srinivasan is a India Cements's CEO. Narayanaswami Srinivasan has spent 29 years at the company.
Appendix 1: Peers in Cement & Cement Products
Below we provide India Cements benchmarking against other companies in Cement & Cement Products 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 |
|---|
| Heidelbergcement India ($HEIDELBERG) | | -13.1% | 37.5% | 36.3% | 2.5% |
| Shree Digvijay Cement Co ($SHREDIGCEM) | -23.4% | 14.9% | -13.5% | 24.7% | |
| Indian Hume Pipe Co ($INDIANHUME) | | -20.3% | 34.5% | 18.3% | 22.7% |
| Birla Corporation ($BIRLACORPN) | | 6.2% | 13.8% | 15.9% | 6.4% |
| Ambuja Cements ($AMBUJACEM) | -23.0% | 14.3% | -6.5% | 9.0% | |
| |
|---|
| Median (15 companies) | -23.4% | 14.7% | 11.7% | 5.1% | 9.4% |
|---|
| India Cements ($INDIACEM) | | 27.8% | 11.4% | -1.4% | -0.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ambuja Cements ($AMBUJACEM) | 23.4% | 25.6% | 18.2% | 19.4% | |
| Heidelbergcement India ($HEIDELBERG) | 6.9% | 8.3% | 9.3% | 15.9% | 7.4% |
| Deccan Cements ($DECCANCE) | 19.2% | 22.8% | 13.2% | 14.7% | |
| Acc ($ACC) | 19.2% | 19.3% | 14.6% | 12.9% | |
| J.K.Cement ($JKCEMENT) | 13.3% | 20.3% | 19.2% | 12.7% | 13.4% |
| |
|---|
| Median (14 companies) | 13.3% | 16.2% | 13.2% | 10.6% | 9.6% |
|---|
| India Cements ($INDIACEM) | 13.3% | 20.6% | 18.4% | 12.4% | 15.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| J.K.Cement ($JKCEMENT) | 14.1% | 6.5% | 18.8% | 55.8% | 16.2% |
| Acc ($ACC) | 4.8% | 5.0% | 8.6% | 13.7% | |
| K.C.P ($KCP) | 28.2% | 8.6% | 9.9% | 12.6% | 5.2% |
| Visaka Industries ($VIKASAS) | 4.6% | 5.5% | 6.5% | 10.2% | 2.2% |
| Shree Digvijay Cement Co ($SHREDIGCEM) | 13.6% | 4.1% | 8.5% | 8.5% | |
| |
|---|
| Median (11 companies) | 7.7% | 5.5% | 7.1% | 8.3% | 4.2% |
|---|
| India Cements ($INDIACEM) | 23.9% | 14.3% | 10.9% | 4.8% | 5.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | 15.5% | 7.6% | 13.8% | 15.0% | 18.0% |
| Saurashtra Cement ($SAURASHCEM) | 4.3% | 38.6% | 42.7% | 13.9% | 26.9% |
| Ambuja Cements ($AMBUJACEM) | 17.0% | 19.4% | 11.2% | 13.0% | |
| Acc ($ACC) | 18.5% | 20.2% | 12.7% | 11.0% | |
| K.C.P ($KCP) | 14.9% | 17.6% | 6.7% | 7.1% | 9.3% |
| |
|---|
| Median (16 companies) | 10.2% | 15.8% | 9.7% | 6.4% | 8.3% |
|---|
| India Cements ($INDIACEM) | 3.5% | 9.5% | 8.3% | 4.1% | 6.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Prism Cement ($PRISMCEM) | 3.4x | 4.8x | 6.0x | 10.0x | 6.0x |
| J.K.Cement ($JKCEMENT) | 4.5x | 2.3x | 2.3x | 6.9x | 5.8x |
| Visaka Industries ($VIKASAS) | 1.3x | 1.3x | 2.2x | 3.8x | 2.7x |
| K.C.P ($KCP) | 2.6x | 1.1x | 3.0x | 3.6x | 2.3x |
| Deccan Cements ($DECCANCE) | 4.1x | 1.7x | 3.3x | 3.4x | |
| |
|---|
| Median (13 companies) | 2.4x | 1.8x | 2.6x | 3.0x | 2.7x |
|---|
| India Cements ($INDIACEM) | 4.8x | 3.2x | 3.5x | 5.5x | 4.6x |
