Jindal Poly Films EBITDA jumped on 57.8% in 2015 and Revenue surged on 46.9%

31-05-2015 • About Jindal Poly Films ($JINDPOLBBPH) • By InTwits

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

• EBITDA Margin is quite volatile: 8.8% in FY2015, 8.1% in FY2014, 6.5% in FY2013, 14.8% in FY2012, 33.7% in FY2011
• Jindal Poly Films has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.5%. At the same time it's a lot of higher than industry average of 5.7%.
• CAPEX is quite volatile: 2,321 in FY2015, 14,136 in FY2014, 467 in FY2013, 1,641 in FY2012, 818 in FY2011
• The company has business model with low profitability: ROIC is at 9.6%
• It operates with medium-size leverage: Net Debt/EBITDA is 2.7x while industry average is 3.1x

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

Jindal Poly Films ($JINDPOLBBPH) key annual financial indicators

mln. INR	2011	2012	2013	2014	2015	2015/2014
P&L
Revenue	28,550	23,644	22,155	51,324	75,386	46.9%
SG&A					123
EBITDA	9,612	3,507	1,430	4,181	6,597	57.8%
Net Income	5,949	1,350	60	781	1,722	120.5%
Balance Sheet
Cash	204	135	67	1,260	1,073	-14.8%
Short Term Debt	1,867	2,642	3,855	6,103	6,411	5.0%
Long Term Debt	3,129	2,566	1,959	9,498	12,294	29.4%
Cash flow
Capex	818	1,641	467	14,136	2,321	-83.6%
Ratios
Revenue growth	-66.5%	-17.2%	-6.3%	131.7%	46.9%
EBITDA growth	178.5%	-63.5%	-59.2%	192.5%	57.8%
EBITDA Margin	33.7%	14.8%	6.5%	8.1%	8.8%	0.6%
Net Income Margin	20.8%	5.7%	0.3%	1.5%	2.3%	0.8%
SG&A, % of revenue					0.2%	0.2%
CAPEX, % of revenue	2.9%	6.9%	2.1%	27.5%	3.1%	-24.5%
ROIC	43.3%	11.1%	2.4%	7.5%	9.6%	2.2%
ROE	44.5%	8.1%	0.4%	5.6%	10.0%	4.4%
Net Debt/EBITDA	0.5x	1.4x	4.0x	3.4x	2.7x	-0.8x

Revenue and profitability

Jindal Poly Films's Revenue jumped on 46.9% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 7.4 pp from -1.3% to 6.1% in FY2015.

Net Income marign increased slightly on 0.76 pp from 1.5% to 2.3% in FY2015.

Capital expenditures (CAPEX) and working capital investments

In FY2015 the company had CAPEX/Revenue of 3.1%. The company showed decline in CAPEX/Revenue of 3.9 pp from 6.9% in FY2012 to 3.1% in FY2015. For the last three years the average CAPEX/Revenue was 10.9%.

Return on investment

The company operates at low ROIC (9.63%) and ROE (9.98%). ROIC increased on 2.2 pp from 7.5% to 9.6% in FY2015. ROE increased on 4.4 pp from 5.6% to 10.0% in FY2015.

Leverage (Debt)

Company's Net Debt / EBITDA is 2.7x and Debt / EBITDA is 2.8x. Net Debt / EBITDA dropped on 0.8x from 3.4x to 2.7x in FY2015. Debt jumped on 19.9% in FY2015 while cash dropped on 14.8% in FY2015.

Appendix 1: Peers in Commodity Chemicals

Below we provide Jindal Poly Films benchmarking against other companies in Commodity Chemicals 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
Tuticorin Alkali Chemicals & Fertilisers ($TUTIALKA)		354.1%	-27.9%	-83.3%	408.0%
Jayshree Chemicals ($JAYCH)		288.9%	17.5%	-75.2%	262.3%
Shree Hari Chemicals Export ($SHHARICH)		-2.5%	-78.0%	299.5%	111.6%
Southern Online Bio Technologies ($SBTL)		50.0%	56.8%	40.8%	22.6%
Gayatri Bioorganics ($GAYATRIBI)		48.9%	17.4%	41.4%	19.6%
Median (34 companies)	-35.2%	19.0%	11.4%	10.6%	5.9%
Jindal Poly Films ($JINDPOLBBPH)		-17.2%	-6.3%	131.7%	46.9%

Top companies by EBITDA margin, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Riddhi Siddhi Gluco Biols ($RIDDHI)					104.7%
Mysore Petro Chemicals ($MYSORPETRO)					47.1%
Aditya Birla Chemicals (India) ($ABCIL)	33.6%	26.8%	27.1%	23.6%	21.9%
Indo Borax & Chemicals ($INDOBORAX)					21.3%
Chemfab Alkalis ($CHEMFALKAL)	19.0%	22.3%	32.9%	24.2%	19.8%
Median (46 companies)	12.1%	10.9%	8.4%	8.6%	6.6%
Jindal Poly Films ($JINDPOLBBPH)	33.7%	14.8%	6.5%	8.1%	8.8%

Top companies by CAPEX/Revenue, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Kanoria Chemicals & Industries ($KANORICHEM)	12.9%	25.1%	6.0%	13.4%	40.3%
Aditya Birla Chemicals (India) ($ABCIL)	5.9%	136.9%	24.2%	30.8%	15.0%
Aarti Industries ($AARTIIND)	4.8%	8.0%	11.2%	11.0%	10.4%
Alkyl Amines Chemicals ($ALKYLAMINE)	8.0%	5.1%	6.6%	5.9%	8.6%
Sukhjit Starch & Chemicals ($SUKHJITS)	9.2%	15.7%	9.4%	5.4%	5.4%
Median (20 companies)	5.9%	5.2%	7.2%	5.4%	3.3%
Jindal Poly Films ($JINDPOLBBPH)	2.9%	6.9%	2.1%	27.5%	3.1%

Top companies by ROIC, %

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Bodal Chemicals ($BODALCHEM)		-1.3%	3.3%	39.0%	38.3%
Alkyl Amines Chemicals ($ALKYLAMINE)	10.3%	16.0%	18.7%	25.0%	23.7%
Aarti Industries ($AARTIIND)	13.1%	15.9%	19.1%	17.2%	17.9%
Transpek Industry ($TRANSPEK)	15.7%	-1.7%	14.2%	11.0%	17.8%
Balaji Amines ($BALAMINES)	20.3%	19.3%	16.1%	15.6%	16.5%
Median (53 companies)	10.5%	9.0%	9.8%	9.9%	7.5%
Jindal Poly Films ($JINDPOLBBPH)	43.3%	11.1%	2.4%	7.5%	9.6%

Top companies by Net Debt / EBITDA

Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Iol Chemicals & Pharmaceuticals ($IOLCP)	5.0x	5.8x	4.5x	3.7x	35.4x
India Glycols ($INDIAGLYCO)	8.2x	4.8x	3.7x	8.5x	14.2x
Godrej Industries ($GODREJIND)	6.8x	9.9x	5.7x	7.9x	10.7x
Kanoria Chemicals & Industries ($KANORICHEM)	4.2x	5.2x	9.6x	3.5x	9.4x
Garware Polyester ($GARWARPOLY)	0.6x	2.2x	3.8x	4.0x	5.2x
Median (35 companies)	2.5x	2.6x	3.0x	0.8x	1.1x
Jindal Poly Films ($JINDPOLBBPH)	0.5x	1.4x	4.0x	3.4x	2.7x

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