P.I.Industries's fundamentals demonstrate strong growth profile

30-05-2015 • About P.I.Industries ($PIIND) • By InTwits

P.I.Industries is an attractive growth stock in Agrochemicals industry. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.

Growth story

P.I.Industries showed fast growth in the last financial year. The company's revenue surged on 21.6% in FY2015. The growth also happened in EBITDA of 29.3% for the same period.

In the longer period the company showed fast revenue growth of 30.3% from FY2012 to FY2015 annually. EBITDA surged on 36.6% from FY2012 to FY2015 annually.

P.I.Industries ($PIIND) financials for the last 5 years

mln. INR	FY2011	FY2012	FY2013	FY2014	FY2015
Revenue	7,177	8,770	11,484	15,955	19,403
Revenue growth, %		22.2%	31.0%	38.9%	21.6%
SG&A, %
EBITDA	1,115	1,493	1,814	2,942	3,803
EBITDA growth, %		33.9%	21.5%	62.2%	29.3%
EBITDA margin, %	15.5%	17.0%	15.8%	18.4%	19.6%
Net Income	651	1,036	973	1,880	2,459
Net Income margin, %	9.07%	11.8%	8.48%	11.8%	12.7%
CAPEX	971	1,178	1,510	645	1,692
CAPEX/Revenue, %	13.5%	13.4%	13.2%	4.04%	8.72%
Debt	2,383	2,468	2,172	1,223	1,148
Cash	42	57	82	350	229
Net Debt/EBITDA	2.1x	1.6x	1.2x	0.3x	0.2x
ROIC, %	22.4%	23.9%	22.5%	31.3%	34.0%
ROE, %	38.3%	39.0%	22.7%	30.7%	30.9%

Profitability and return on investment

EBITDA growth was partly attributed to margin expansion. P.I.Industries showed EBITDA margin growth of 1.20 pp from 18.4% to 19.6% in FY2015. In the longer period P.I.Industries showed fast EBITDA margin growth of 2.60 pp from 17% in FY2012 to 19.6% in FY2015.

We call P.I.Industries an attractive growth stock as together with the growth it delivers high ROIC at 34.0%. During the last three years it surged - it was 23.9% in FY2012. Average ROIC for the last three years was 29.3%.

Net Income margin increased on 0.900 pp from 11.8% to 12.7% in FY2015. In the longer period Net Income margin increased on 0.900 pp from 11.8% in FY2012 to 12.7% in FY2015.

P.I.Industries operates at ROE of 30.9%. For the last three years the average ROE was 28.1%.

Capital expenditures (CAPEX)

To fuel this fast growth the company had to invest in CAPEX.In FY2015 P.I.Industries had CAPEX/Revenue of 8.72%. CAPEX/Revenue dropped on 4.71 pp from 13.4% in FY2012 to 8.72% in FY2015. Average CAPEX/Revenue for the last three years was 8.64%.

Leverage (Debt)

Having such a fast growth profile P.I.Industries keeps low debt level at 0.2x Net Debt/EBITDA. If we look for the longer period P.I.Industries showed big decline in leverage of 1.37x from 1.61x in FY2012 to 0.24x in FY2015.

Management team

P.I.Industries is run by Mayank Singhal as a CEO.

Peers in Agrochemicals

Below you can find P.I.Industries benchmarking vs. other companies in Agrochemicals 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, %

	FY2011	FY2012	FY2013	FY2014	FY2015
Top 5
Astec Lifesciences Limited ($ASTEC)		2.6%	55.7%	18.4%	28.9%
Bhagiradha Chemicals & Industries ($BHAGCHEM)		15.2%	113.6%	18.4%	25.9%
Excel Industries ($EXCELINDUS)		14.7%	21.7%	8.3%	15.8%
Rallis India ($RALLIS)		17.4%	14.4%	19.8%	4.3%
Monsanto India ($MONSANTO)		2.9%	16.8%	33.6%	-4.6%
Median (6 companies)	-59.4%	15.2%	18.2%	18.4%	10.0%
P.I.Industries ($PIIND)		22.2%	31.0%	38.9%	21.6%

Top companies by EBITDA margin, %

	FY2011	FY2012	FY2013	FY2014	FY2015
Top 5
Monsanto India ($MONSANTO)	18.3%	15.1%	16.4%	7.3%	20.9%
Astec Lifesciences Limited ($ASTEC)	14.5%	15.5%	16.7%	17.1%	20.3%
Rallis India ($RALLIS)	18.2%	16.2%	14.7%	15.2%	15.4%
Jubilant Industries ($JUBLINDS)	9.9%	1.8%	1.6%		15.3%
Excel Industries ($EXCELINDUS)	12.6%	8.5%	10.9%	9.8%	15.0%
Median (6 companies)	12.6%	11.0%	11.3%	10.2%	15.4%
P.I.Industries ($PIIND)	15.5%	17.0%	15.8%	18.4%	19.6%

Top companies by CAPEX/Revenue, %

	FY2011	FY2012	FY2013	FY2014	FY2015
Top 5
Astec Lifesciences Limited ($ASTEC)	32.6%	41.7%	14.9%	9.2%	7.5%
Excel Industries ($EXCELINDUS)	3.7%	7.6%	5.7%	8.5%	6.8%
Rallis India ($RALLIS)	12.1%	4.5%	3.2%	3.4%	3.3%
Jubilant Industries ($JUBLINDS)	3.5%	1.7%			2.6%
Monsanto India ($MONSANTO)	3.3%	3.3%	2.0%	1.9%	1.7%
Median (5 companies)	4.0%	6.0%	5.7%	3.9%	3.3%
P.I.Industries ($PIIND)	13.5%	13.4%	13.2%	4.0%	8.7%

Top companies by ROIC, %

	FY2011	FY2012	FY2013	FY2014	FY2015
Top 5
Rallis India ($RALLIS)	32.6%	26.3%	25.3%	28.3%	25.4%
Insecticides (India) ($INSECTICID)	23.5%	19.2%	15.6%	15.7%
Excel Industries ($EXCELINDUS)	13.8%	8.5%	14.2%	11.9%	20.3%
Astec Lifesciences Limited ($ASTEC)	7.2%	5.6%	9.7%	10.7%	19.1%
Monsanto India ($MONSANTO)	15.1%	12.4%	15.3%	7.8%	29.2%
Median (9 companies)	13.8%	6.4%	9.7%	11.9%	22.9%
P.I.Industries ($PIIND)	22.4%	23.9%	22.5%	31.3%	34.0%

Top companies by Net Debt / EBITDA

	FY2011	FY2012	FY2013	FY2014	FY2015
Top 5
Jubilant Industries ($JUBLINDS)	-0.0x	12.1x	11.5x		2.5x
Astec Lifesciences Limited ($ASTEC)	2.7x	4.1x	2.4x	2.3x	1.7x
Excel Industries ($EXCELINDUS)	1.4x	2.7x	1.6x	2.3x	1.3x
Rallis India ($RALLIS)	0.5x	0.7x	0.1x	0.2x	0.4x
Bhagiradha Chemicals & Industries ($BHAGCHEM)	13.9x	163.2x	3.6x	0.0x	0.0x
Median (6 companies)	1.1x	3.4x	3.0x	0.2x	0.8x
P.I.Industries ($PIIND)	2.1x	1.6x	1.2x	0.3x	0.2x

Similar news

30-05-2015 Looking for growth stocks? Pay attention to Divi'S Laboratories

30-05-2015 Excel Industries's growth is outstanding: revenue grew 15.1% and EBITDA 39.4% annually over the last three years

30-05-2015 Acrysil demonstrated fast growth in recent years. Will the growth continue?

29-05-2015 Looking for fundamental growth story? Pay attention to Skipper

29-05-2015 Looking for a profitable fast-growing stock? Look at Waterbase