Sunflag Iron & Steel Co EBITDA jumped on 15.1% in 2015 and Revenue jumped on 10.8%

30-05-2015 • About Sunflag Iron & Steel Co ($SUNFLAG) • By InTwits

Sunflag Iron & Steel Co reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:

• Sunflag Iron & Steel Co has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.2%. At the same time it's a lot of higher than industry average of 12.8%.
• CAPEX is quite volatile: 41.7 in FY2015, 68.3 in FY2014, 544 in FY2013, 1,648 in FY2012, 1,839 in FY2011
• The company has business model with average profitability: ROIC is at 11.2%

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

Sunflag Iron & Steel Co ($SUNFLAG) key annual financial indicators

mln. INR	2011	2012	2013	2014	2015	2015/2014
P&L
Revenue	15,441	16,182	15,693	15,854	17,566	10.8%
EBITDA	1,623	1,203	1,185	1,470	1,693	15.1%
Net Income	705	193	-125	217	244	12.6%
Balance Sheet
Cash	73	153	106	106	47	-55.4%
Short Term Debt	1,578	2,552	2,240	2,494	2,789	11.8%
Long Term Debt	2,754	3,528	2,815	2,277	1,425	-37.4%
Cash flow
Capex	1,839	1,648	544	68	42	-38.9%
Ratios
Revenue growth	-28.2%	4.8%	-3.0%	1.0%	10.8%
EBITDA growth	-15.1%	-25.9%	-1.5%	24.1%	15.1%
EBITDA Margin	10.5%	7.4%	7.5%	9.3%	9.6%	0.4%
Net Income Margin	4.6%	1.2%	-0.8%	1.4%	1.4%	0.0%
CAPEX, % of revenue	11.9%	10.2%	3.5%	0.4%	0.2%	-0.2%
ROIC	14.1%	7.2%	5.6%	8.3%	11.2%	3.0%
ROE	15.9%	4.0%	-2.6%	4.4%	4.5%	0.1%
Net Debt/EBITDA	2.6x	4.9x	4.2x	3.2x	2.5x	-0.7x

Revenue and profitability

The company's Revenue surged on 10.8% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 2.5 pp from 17.5% to 20.0% in FY2015.

Net Income marign showed almost no change in FY2015.

Capital expenditures (CAPEX) and working capital investments

The company's CAPEX/Revenue was 0.24% in FY2015. Sunflag Iron & Steel Co showed decline in CAPEX/Revenue of 9.9 pp from 10.2% in FY2012 to 0.24% in FY2015. For the last three years the average CAPEX/Revenue was 1.4%.

Return on investment

The company operates at low ROIC (11.24%) and ROE (4.49%). ROIC increased on 3.0 pp from 8.3% to 11.2% in FY2015. ROE showed almost no change in FY2015.

Leverage (Debt)

Debt level is 2.5x Net Debt / EBITDA and 2.5x Debt / EBITDA. Net Debt / EBITDA dropped on 0.7x from 3.2x to 2.5x in FY2015. Debt dropped on 11.7% in FY2015 while cash dropped on 55.4% in FY2015.

Appendix 1: Peers in Iron & Steel/Interm.Products

Below we provide Sunflag Iron & Steel Co benchmarking against other companies in Iron & Steel/Interm.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
Uttam Galva Steels ($UTTAMSTL)		12.0%	11.0%	-13.2%	55.0%
Modern Steels ($MDRNSTL)		-2.6%	-22.7%	0.7%	20.3%
Maithan Alloys ($MAITHANALL)		-1.5%	59.1%	1.1%	15.0%
Pennar Industries ($PENIND)		0.9%	-8.5%	0.5%	12.7%
S.A.L.Steel ($SALSTEEL)		2.3%	15.8%	-13.2%	10.9%
Median (26 companies)	-24.2%	12.5%	8.8%	3.4%	-0.4%
Sunflag Iron & Steel Co ($SUNFLAG)		4.8%	-3.0%	1.0%	10.8%

Top companies by EBITDA margin, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Jindal Steel & Power ($JINDALSTEL)	48.3%	37.5%	30.5%	28.1%	29.8%
Sarda Energy & Minerals ($SARDAEN)	15.2%	16.3%	21.5%	21.3%	21.5%
Bhushan Steel ($BHUSANSTL)	29.0%	31.2%	32.3%	28.1%	20.4%
Jsw Steel ($JSWSTEEL)	20.2%	17.8%	17.1%	17.9%	17.7%
Tata Metaliks ($TATAMETALI)	3.2%	-9.6%	0.9%	6.8%	14.6%
Median (25 companies)	13.4%	9.5%	9.2%	7.0%	9.0%
Sunflag Iron & Steel Co ($SUNFLAG)	10.5%	7.4%	7.5%	9.3%	9.6%

Top companies by CAPEX/Revenue, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Jindal Steel & Power ($JINDALSTEL)	64.7%	34.2%	47.6%	69.6%	26.4%
Jayaswal Neco Industries ($JAYNECOIND)	27.9%	20.4%	44.0%	31.1%	17.3%
Steel Authority Of India ($SAIL)	25.3%	20.9%	20.7%	19.3%	16.9%
Bhushan Steel ($BHUSANSTL)	81.1%	47.2%	44.0%	50.4%	16.2%
Jsw Steel ($JSWSTEEL)	22.0%	11.9%	14.7%	11.3%	12.7%
Median (16 companies)	12.3%	7.5%	11.6%	7.7%	5.4%
Sunflag Iron & Steel Co ($SUNFLAG)	11.9%	10.2%	3.5%	0.4%	0.2%

Top companies by ROIC, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Tata Metaliks ($TATAMETALI)	3.1%	-23.5%	-3.7%	19.9%	57.4%
Nova Iron & Steel ($NOVIS)				15.4%
Kirloskar Ferrous Industries ($KIRLFER)	20.0%	19.1%	16.8%	12.4%	14.7%
Pennar Industries ($PENIND)	31.6%	26.8%	18.4%	12.3%	15.7%
Jsw Steel ($JSWSTEEL)	9.7%	11.0%	10.3%	12.1%	9.9%
Median (40 companies)	9.4%	6.8%	5.7%	5.5%	5.0%
Sunflag Iron & Steel Co ($SUNFLAG)	14.1%	7.2%	5.6%	8.3%	11.2%

Top companies by Net Debt / EBITDA

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Visa Steel ($VISASTEEL)	6.9x	20.1x		24.4x	187.1x
Ismt ($ISMTLTD)	4.4x	5.3x	9.8x	19.9x	48.3x
Kic Metaliks ($KAJARIR)	6.6x	9.2x	3.0x	18.2x	19.8x
Bhushan Steel ($BHUSANSTL)	8.1x	6.3x	8.6x	12.9x	17.7x
Prakash Industries ($PRAKASH)	1.8x	2.5x	2.8x	2.5x	11.9x
Median (24 companies)	3.8x	4.2x	4.4x	3.4x	2.8x
Sunflag Iron & Steel Co ($SUNFLAG)	2.6x	4.9x	4.2x	3.2x	2.5x

Similar news

30-05-2015 Rathi Graphic Technologies reports 25.4% EBITDA growth and 11.7% Revenue growth

30-05-2015 Ivp reports 164% EBITDA growth and 3.8 pp EBITDA Margin growth from 2.8% to 6.6%

30-05-2015 Hitech Plast reports 10.6 pp EBITDA Margin decline from 10.6% to in 2015

30-05-2015 Venus Remedies Net Income dropped on 92.9% in 2015 and Revenue dropped on 17.0%

30-05-2015 Future Market Networks EBITDA Margin dropped on 18.4 pp from 18.4% to in 2015