Housing Development Finance Corp reports 16.3% Net Income growth in 2016 and 10.1% Revenue growth
02-05-2016 • About Housing Development Finance Corp (
$HDFC) • By InTwits
Housing Development Finance Corp reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Housing Development Finance Corp is a fast growth stock: FY2016 revenue growth was 10.1%, 5 year revenue CAGR was 15.6% at FY2016 ROIC 4.7%
- Housing Development Finance Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.6%.
- The company has potentially unprofitable business model: ROIC is 4.7%
- It operates with high leverage: Net Debt/EBITDA is 6.4x while industry average is 8.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Housing Development Finance Corp's Revenue jumped on 10.1%. EBITDA Margin showed almost no change in FY2016.
Net Income margin increased slightly on 1.0 pp from 18.1% to 19.1% in FY2016.
Investments (CAPEX, working capital and M&A)
In FY2016 Housing Development Finance Corp had CAPEX/Revenue of 0.28%. The company showed almost no change in CAPEX/Revenue from FY2013 to FY2016. For the last three years the average CAPEX/Revenue was 0.73%.
Return on investment
The company operates at good ROE (21.2%) while ROIC is low (4.7%). ROIC showed almost no change in FY2016. ROE showed almost no change in FY2016. ROE declined at -0.81 pp per annum in FY2012-FY2016.
Leverage (Debt)
Debt level is 6.4x Net Debt / EBITDA and 6.6x Debt / EBITDA. Net Debt / EBITDA surged on 0.1x from 6.3x to 6.4x in FY2016. Debt jumped on 13.8% while cash jumped on 49.7%. During the last 5 years Net Debt/EBITDA bottomed in FY2013 at 5.9x and was growing since that time.
Housing Development Finance Corp has short term refinancing risk: cash is only 5.0% of short term debt.
Valuation and dividends
The company's trades at EV/EBITDA 11.9x and P/E 16.9x while industy averages are 17.8x and 21.9x.
Management team
The company's CEO is Keki M Mistry. Keki M Mistry has 10 years tenure with the company.
Financial and operational results
Housing Development Finance Corp ($HDFC) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 303,029 | 359,869 | 408,146 | 483,900 | 532,571 | 10.1% |
| EBITDA | 174,736 | 215,547 | 252,498 | 287,531 | 318,251 | 10.7% |
| Net Income | 54,625 | 66,397 | 79,478 | 87,626 | 101,903 | 16.3% |
Balance Sheet
|
|---|
| Cash | 64,814 | 70,717 | 85,881 | 42,619 | 63,811 | 49.7% |
| Short Term Debt | 632,320 | 643,914 | 930,863 | 1,099,576 | 1,267,019 | 15.2% |
| Long Term Debt | 575,219 | 694,078 | 712,267 | 756,724 | 846,182 | 11.8% |
Cash flow
|
|---|
| Capex | 1,498 | 1,723 | 2,551 | 6,163 | 1,479 | -76.0% |
Ratios
|
|---|
| Revenue growth | 17.5% | 18.8% | 13.4% | 18.6% | 10.1% | |
| EBITDA growth | 34.3% | 23.4% | 17.1% | 13.9% | 10.7% | |
|
|---|
| EBITDA Margin | 57.7% | 59.9% | 61.9% | 59.4% | 59.8% | 0.3% |
| Net Income Margin | 18.0% | 18.5% | 19.5% | 18.1% | 19.1% | 1.0% |
| CAPEX, % of revenue | 0.5% | 0.5% | 0.6% | 1.3% | 0.3% | -1.0% |
|
|---|
| ROIC | 4.6% | 4.8% | 4.8% | 4.6% | 4.7% | 0.0% |
| ROE | 24.1% | 23.7% | 22.9% | 21.2% | 21.2% | 0.0% |
| Net Debt/EBITDA | 6.5x | 5.9x | 6.2x | 6.3x | 6.4x | 0.1x |
Peers in Housing Finance
Below we provide Housing Development Finance Corp benchmarking against other companies in Housing Finance 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Can Fin Homes ($CANFINHOME) | - | 36.9% | 47.2% | 41.4% | 32.5% |
| Gic Housing Finance ($GICHSGFIN) | - | 26.1% | 12.8% | 17.2% | 19.7% |
| Lic Housing Finance ($LICHSGFIN) | - | 23.9% | 20.7% | 15.8% | 15.5% |
| |
|---|
| Median (3 companies) | - | 26.1% | 20.7% | 17.2% | 19.7% |
|---|
| Housing Development Finance Corp ($HDFC) | - | 18.8% | 13.4% | 18.6% | 10.1% |
Top companies by EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lic Housing Finance ($LICHSGFIN) | 93.4% | 94.9% | 96.2% | 96.4% | 95.0% |
| Can Fin Homes ($CANFINHOME) | 92.2% | 91.5% | 92.0% | 92.0% | 92.4% |
| Gic Housing Finance ($GICHSGFIN) | 89.0% | 88.2% | 88.7% | 90.9% | 90.4% |
| |
|---|
| Median (3 companies) | 92.2% | 91.5% | 92.0% | 92.0% | 92.4% |
|---|
| Housing Development Finance Corp ($HDFC) | 57.7% | 59.9% | 61.9% | 59.4% | 59.8% |
Top companies by CAPEX/Revenue, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Can Fin Homes ($CANFINHOME) | 0.5% | 1.2% | 0.6% | 0.7% | 0.3% |
| Lic Housing Finance ($LICHSGFIN) | 0.6% | 0.1% | 0.1% | 0.2% | 0.2% |
| Gic Housing Finance ($GICHSGFIN) | 0.4% | 0.3% | 0.1% | 0.1% | 0.0% |
| |
|---|
| Median (3 companies) | 0.5% | 0.3% | 0.1% | 0.2% | 0.2% |
|---|
| Housing Development Finance Corp ($HDFC) | 0.5% | 0.5% | 0.6% | 1.3% | 0.3% |
Top companies by ROIC, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Can Fin Homes ($CANFINHOME) | 2.8% | 2.3% | 2.2% | 2.0% | 2.8% |
| Gic Housing Finance ($GICHSGFIN) | - | - | - | - | 2.7% |
| Lic Housing Finance ($LICHSGFIN) | - | - | - | - | - |
| |
|---|
| Median (3 companies) | 2.8% | 2.3% | 2.2% | 2.0% | 2.8% |
|---|
| Housing Development Finance Corp ($HDFC) | 4.6% | 4.8% | 4.8% | 4.6% | 4.7% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Can Fin Homes ($CANFINHOME) | 8.7x | 9.8x | 9.9x | 9.8x | 9.5x |
| Lic Housing Finance ($LICHSGFIN) | 9.6x | 9.4x | 9.0x | 9.3x | 9.3x |
| Gic Housing Finance ($GICHSGFIN) | 9.1x | 8.0x | 8.3x | 8.6x | 8.8x |
| |
|---|
| Median (3 companies) | 9.1x | 9.4x | 9.0x | 9.3x | 9.3x |
|---|
| Housing Development Finance Corp ($HDFC) | 6.5x | 5.9x | 6.2x | 6.3x | 6.4x |
