Motilal Oswal Financial Services EBITDA surged on 68.0% and EBITDA Margin increased on 6.8 pp from 33.4% to 40.1%
30-04-2016 • About Motilal Oswal Financial Services (
$MOTILALOFS) • By InTwits
Motilal Oswal Financial Services reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Motilal Oswal Financial Services is a growth stock: FY2016 revenue growth was 39.8%, 5 year revenue CAGR was 12.4% at FY2016 ROIC 7.8%
- Motilal Oswal Financial Services has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.7%. At the same time it's a lot of higher than industry average of 1.7%.
- CAPEX is quite volatile: ₹273m in FY2016, ₹261m in FY2015, ₹80m in FY2014, ₹252m in FY2013, ₹729m in FY2012
- The company has business model with low profitability: ROIC is 7.8%
- It operates with high leverage: Net Debt/EBITDA is 5.4x while industry average is 2.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Motilal Oswal Financial Services's Revenue surged on 39.8%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 7.9 pp from 24.9% to 32.8% in FY2016.
Net Income margin decreased on 2.9 pp from 18.6% to 15.7% in FY2016.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 2.5% in FY2016. Motilal Oswal Financial Services showed decline in CAPEX/Revenue of 2.8 pp from 5.3% in FY2013 to 2.5% in FY2016. It's average level of CAPEX/Revenue for the last three years was 2.5%.
Return on investment
The company operates at good ROE (12.4%) while ROIC is low (7.8%). ROIC decreased on 4.1 pp from 11.9% to 7.8% in FY2016. ROE increased slightly on 0.73 pp from 11.6% to 12.4% in FY2016. During FY2012-FY2016 ROE bottomed in FY2014 at 3.3% and was growing since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 5.4x and Debt / EBITDA is 5.9x. Net Debt / EBITDA jumped on 2.5x from 2.9x to 5.4x in FY2016. Debt surged on 203% while cash jumped on 104%. Net Debt/EBITDA grew at 1.4x per annum in FY2012-FY2016.
Motilal Oswal Financial Services has short term refinancing risk: cash is only 22.4% of short term debt.
Financial and operational results
Motilal Oswal Financial Services ($MOTILALOFS) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 4,710 | 4,727 | 4,685 | 7,716 | 10,784 | 39.8% |
| EBITDA | 1,604 | 1,765 | 1,443 | 2,575 | 4,328 | 68.0% |
| Net Income | 1,039 | 1,091 | 395 | 1,436 | 1,691 | 17.8% |
Balance Sheet
|
|---|
| Cash | 929 | 226 | 488 | 925 | 1,888 | 104.0% |
| Short Term Debt | 487 | 29 | 10 | 5,395 | 8,444 | 56.5% |
| Long Term Debt | 0 | 0 | 0 | 3,006 | 17,000 | 465.6% |
Cash flow
|
|---|
| Capex | 729 | 252 | 80 | 261 | 273 | 4.9% |
Ratios
|
|---|
| Revenue growth | -21.6% | 0.4% | -0.9% | 64.7% | 39.8% | |
| EBITDA growth | -31.5% | 10.1% | -18.3% | 78.5% | 68.0% | |
|
|---|
| EBITDA Margin | 34.0% | 37.3% | 30.8% | 33.4% | 40.1% | 6.8% |
| Net Income Margin | 22.1% | 23.1% | 8.4% | 18.6% | 15.7% | -2.9% |
| CAPEX, % of revenue | 15.5% | 5.3% | 1.7% | 3.4% | 2.5% | -0.8% |
|
|---|
| ROIC | | 12.0% | 9.7% | 11.9% | 7.8% | -4.1% |
| ROE | 9.4% | 9.2% | 3.3% | 11.6% | 12.4% | 0.7% |
| Net Debt/EBITDA | -0.3x | -0.1x | -0.3x | 2.9x | 5.4x | 2.5x |
Peers in Finance (including NBFCs)
Below you can find Motilal Oswal Financial Services benchmarking vs. other companies in Finance (including NBFCs) 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 |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | -11.7% | -24.9% | -7.1% | 188.4% | - |
| Sks Microfinance ($SKSMICRO) | -62.8% | -25.6% | 55.0% | 47.3% | - |
| Bajaj Holdings & Investment ($BAJAJHLDNG) | - | 12.8% | 25.9% | 27.0% | -12.2% |
| Bajaj Finserv ($BAJAJFINSV) | 59.7% | 28.1% | 18.8% | 26.8% | - |
| Master Trust ($MASTERTR) | 10.2% | -0.0% | -5.3% | 26.0% | - |
| |
|---|
| Median (23 companies) | 21.8% | 27.4% | 20.8% | 13.3% | 10.9% |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | - | 0.4% | -0.9% | 64.7% | 39.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Microse India ($MICROSE) | - | - | - | 101.1% | - |
| Pnb Gilts ($PNBGILTS) | 94.0% | 96.4% | 96.4% | 96.1% | - |
| Jsw Holdings ($JSWHL) | - | - | - | 93.8% | - |
| Rural Electrification Corporation ($RECLTD) | 97.2% | 97.3% | 96.7% | 93.3% | - |
| Bajaj Holdings & Investment ($BAJAJHLDNG) | 96.1% | 95.4% | 92.3% | 92.7% | 91.4% |
| |
|---|
| Median (48 companies) | 70.0% | 67.8% | 66.4% | 56.6% | 66.8% |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | 34.0% | 37.3% | 30.8% | 33.4% | 40.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | 1.0% | 1.3% | 4.5% | 7.3% | - |
| Clarus Finance & Securities ($CLARUS) | - | - | 6.9% | 5.8% | - |
| Srei Infrastructure Finance ($SREINFRA) | 30.2% | 8.5% | 12.3% | 5.4% | - |
| Bengal & Assam Company ($BENGALASM) | 15.9% | 4.5% | 1.2% | 2.1% | - |
| Shriram City Union Finance ($SHRIRAMCIT) | 1.8% | 2.0% | 1.0% | 1.2% | 1.0% |
| |
|---|
| Median (21 companies) | 0.6% | 0.7% | 0.9% | 0.7% | 0.8% |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | 15.5% | 5.3% | 1.7% | 3.4% | 2.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sks Microfinance ($SKSMICRO) | - | - | 4.1% | 6.6% | - |
| Shriram City Union Finance ($SHRIRAMCIT) | 6.1% | 5.8% | 5.8% | 5.7% | 4.6% |
| Rural Electrification Corporation ($RECLTD) | - | 4.7% | 5.2% | 4.7% | - |
| Mahindra & Mahindra Financial Services ($M&MFIN) | 6.4% | 6.3% | 5.3% | 4.2% | 3.2% |
| Bajaj Holdings & Investment ($BAJAJHLDNG) | 3.6% | 3.4% | 3.5% | 3.9% | 3.0% |
| |
|---|
| Median (52 companies) | 4.1% | 4.4% | 3.8% | 3.9% | 3.2% |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | - | 12.0% | 9.7% | 11.9% | 7.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | 9.0x | - | 10.8x | 8.9x | - |
| Pnb Gilts ($PNBGILTS) | 14.2x | 11.2x | 11.3x | 8.8x | - |
| Srei Infrastructure Finance ($SREINFRA) | 7.0x | 6.2x | 7.5x | 8.0x | - |
| Rural Electrification Corporation ($RECLTD) | 8.3x | 8.0x | 7.5x | 8.0x | - |
| Magma Fincorp ($MAGMA) | 7.7x | 8.5x | 7.0x | 7.7x | - |
| |
|---|
| Median (44 companies) | 4.8x | 3.6x | 3.9x | 0.0x | 6.4x |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | -0.3x | -0.1x | -0.3x | 2.9x | 5.4x |
