Oberoi Realty reports 53.7% revenue growth in FY2016 and 8.7 pp EBITDA Margin decline from 56.4% to 47.7%
29-04-2016 • About Oberoi Realty (
$OBEROIRLTY) • By InTwits
Oberoi Realty reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Oberoi Realty has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.6%. At the same time it's a lot of higher than industry average of 7.4%.
- CAPEX is quite volatile: ₹465m in FY2016, ₹0m in FY2015, ₹482m in FY2014, ₹1,181m in FY2013, ₹2,659m in FY2012
- The company has business model with average profitability: ROIC is 10.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 53.7%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 50.4 pp from 9.5% to -41.0% in FY2016.
Net Income margin decreased on 4.4 pp from 34.8% to 30.4% in FY2016. Net Income margin stuck to a declining trend at -6.6 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
Oberoi Realty's CAPEX/Revenue was 3.3% in FY2016. The company showed decline in CAPEX/Revenue of 8.0 pp from 11.3% in FY2013 to 3.3% in FY2016.
Return on investment
The company operates at low ROIC (10.7%) and ROE (8.6%). ROIC increased slightly on 1.3 pp from 9.4% to 10.7% in FY2016. ROE increased slightly on 1.5 pp from 7.0% to 8.6% in FY2016. During the last 5 years ROE bottomed in FY2015 at 7.0%.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.5x and Debt / EBITDA is 1.0x. Net Debt / EBITDA dropped on 0.7x from 1.2x to 0.5x in FY2016. Debt dropped on 28.8% while cash increased on 3.5%.
Oberoi Realty has no short term refinancing risk: cash is higher than short term debt (175.0%).
Valuation and dividends
Oberoi Realty's trades at EV/EBITDA 14.8x and P/E 22.3x while industy averages are 17.8x and 21.9x. Oberoi Realty's EV/(EBITDA-CAPEX) is 15.9x with the industry average at 22.8x.
Management team
The company's CEO is Vikas Oberoi. Vikas Oberoi has 10 years tenure with the company. Oberoi Realty's CFO Saumil Daru has spent 13 years with the company.
Financial and operational results
Oberoi Realty ($OBEROIRLTY) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8,184 | 10,417 | 7,985 | 9,109 | 13,997 | 53.7% |
| EBITDA | 4,853 | 6,133 | 4,348 | 5,138 | 6,675 | 29.9% |
| Net Income | 4,628 | 5,048 | 3,111 | 3,171 | 4,259 | 34.3% |
Balance Sheet
|
|---|
| Cash | 3 | 2,975 | 4,997 | 2,656 | 2,748 | 3.5% |
| Short Term Debt | 0 | 0 | 11 | 1,716 | 1,571 | -8.5% |
| Long Term Debt | 0 | 0 | 750 | 7,299 | 4,844 | -33.6% |
Cash flow
|
|---|
| Capex | 2,659 | 1,181 | 482 | 0 | 465 | |
Ratios
|
|---|
| Revenue growth | -16.9% | 27.3% | -23.4% | 14.1% | 53.7% | |
| EBITDA growth | -16.0% | 26.4% | -29.1% | 18.2% | 29.9% | |
|
|---|
| EBITDA Margin | 59.3% | 58.9% | 54.5% | 56.4% | 47.7% | -8.7% |
| Net Income Margin | 56.6% | 48.5% | 39.0% | 34.8% | 30.4% | -4.4% |
| CAPEX, % of revenue | 32.5% | 11.3% | 6.0% | 0.0% | 3.3% | |
|
|---|
| ROIC | 12.9% | 14.8% | 9.4% | 9.4% | 10.7% | 1.3% |
| ROE | 13.1% | 12.8% | 7.3% | 7.0% | 8.6% | 1.5% |
| Net Debt/EBITDA | -0.0x | -0.5x | -1.0x | 1.2x | 0.5x | -0.7x |
Peers in Realty
Below you can find Oberoi Realty benchmarking vs. other companies in Realty 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sspdl ($SSPDL) | 16.2% | -11.8% | -43.4% | 326.1% | - |
| Orbit Corporation ($ORBITCORP) | -4.2% | -21.9% | -88.0% | 275.1% | - |
| Ajmera Realty & Infra India ($AJMERA) | 21.3% | -61.7% | -1.8% | 109.9% | - |
| Prajay Engineers Syndicate ($PRAENG) | -21.1% | 42.0% | -30.1% | 62.8% | - |
| Godrej Properties ($GODREJPROP) | 70.6% | 34.7% | 13.7% | 56.3% | - |
| |
|---|
| Median (34 companies) | 0.3% | 3.4% | -1.8% | 11.4% | 76.7% |
|---|
| Oberoi Realty ($OBEROIRLTY) | - | 27.3% | -23.4% | 14.1% | 53.7% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Godrej Properties ($GODREJPROP) | 24.9% | 33.3% | 28.9% | 19.4% | - |
| |
|---|
| Median (1 company) | 24.9% | 33.3% | 28.9% | 19.4% | - |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hubtown ($HUBTOWN) | 53.3% | 72.4% | 67.6% | 82.4% | - |
| Housing Development & Infrastructure ($HDIL) | 75.8% | 40.6% | 102.5% | 78.9% | - |
| Tci Developers ($TCIDEVELOP) | - | - | - | 75.9% | - |
| Orbit Corporation ($ORBITCORP) | 42.4% | 53.3% | -127.2% | 69.8% | - |
| The Phoenix Mills ($PHOENIXLTD) | 54.7% | 56.2% | 46.9% | 46.2% | - |
| |
|---|
| Median (43 companies) | 19.4% | 13.4% | 19.8% | 19.4% | 22.0% |
|---|
| Oberoi Realty ($OBEROIRLTY) | 59.3% | 58.9% | 54.5% | 56.4% | 47.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Prozone Intu Properties ($PROZONINTU) | - | - | - | 89.5% | - |
| Ashiana Housing ($ASHIANA) | - | - | - | 26.7% | - |
| Brigade Enterprises ($BRIGADE) | 45.7% | 10.7% | 17.0% | 18.5% | - |
| Prestige Estates Projects ($PRESTIGE) | 37.7% | 30.2% | 18.8% | 11.6% | - |
| Parsvnath Developers ($PARSVNATH) | 15.9% | - | 11.6% | 10.6% | - |
| |
|---|
| Median (30 companies) | 4.7% | 2.3% | 3.5% | 2.5% | 2.9% |
|---|
| Oberoi Realty ($OBEROIRLTY) | 32.5% | 11.3% | 6.0% | 0.0% | 3.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ahluwalia Contracts (India) ($AHLUCONT) | -3.2% | -15.8% | 5.6% | 21.2% | - |
| Poddar Developers ($PODDARDEV) | 3.9% | 2.6% | 12.9% | 19.1% | - |
| Lancor Holdings ($LANCORHOL) | 18.0% | 11.6% | 19.5% | 17.7% | - |
| Mahindra Lifespace Developers ($MAHLIFE) | 10.4% | 11.7% | 6.6% | 14.9% | 4.6% |
| Sobha Developers ($SOBHA) | 18.8% | 16.7% | 14.6% | 12.7% | - |
| |
|---|
| Median (50 companies) | 5.7% | 4.6% | 5.6% | 6.8% | 4.6% |
|---|
| Oberoi Realty ($OBEROIRLTY) | 12.9% | 14.8% | 9.4% | 9.4% | 10.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| D B Realty ($DBREALTY) | 13.2x | 135.4x | 14.0x | 54.8x | - |
| B.L.Kashyap And Sons ($BLKASHYAP) | 8.2x | 5.8x | 12.7x | 40.1x | - |
| Vipul ($VIPUL) | 0.7x | 3.0x | 10.8x | 26.0x | - |
| Ansal Properties & Infrastructure ($ANSALAPI) | 12.8x | 11.9x | 11.4x | 16.6x | - |
| Srs Real Infrastructure ($SRSREAL) | 11.7x | 10.0x | 12.9x | 14.7x | - |
| |
|---|
| Median (37 companies) | 5.3x | 5.1x | 5.0x | 4.0x | 4.9x |
|---|
| Oberoi Realty ($OBEROIRLTY) | -0.0x | -0.5x | -1.0x | 1.2x | 0.5x |
