Hinduja Ventures reports 335% CAPEX growth in 2016 while 52.6% Revenue decline
12-05-2016 • About Hinduja Ventures (
$HINDUJAVEN) • By InTwits
Hinduja Ventures reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is quite volatile: 17.1% in FY2016, 54.7% in FY2015, 18.2% in FY2014, 21.0% in FY2013, 27.7% in FY2012
- Hinduja Ventures has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.7%. At the same time it's a lot of higher than industry average of 17.0%.
- CAPEX is quite volatile: ₹4,294m in FY2016, ₹988m in FY2015, ₹1,091m in FY2014, ₹3,889m in FY2013, ₹522m in FY2012
- The company has potentially unprofitable business model: ROIC is 1.3%
- It operates with high leverage: Net Debt/EBITDA is 11.0x while industry average is 3.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Hinduja Ventures's Revenue dropped on 52.6%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.2 pp from 14.6% to 16.8% in FY2016.
Net Income margin dropped on 55.7 pp from 43.4% to -12.3% in FY2016.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 65.0% in FY2016. The company showed small CAPEX/Revenue decline of 0.76 pp from 65.8% in FY2013 to 65.0% in FY2016. It's average level of CAPEX/Revenue for the last three years was 28.8%. Battling declining revenue Hinduja Ventures made large investments to CAPEX (380% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low but positive ROIC (1.3%) and negative ROE (-11.4%). ROIC dropped on 38.2 pp from 39.5% to 1.3% in FY2016. ROE dropped on 89.7 pp from 78.3% to -11.4% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 11.0x and Debt / EBITDA is 11.7x. Net Debt / EBITDA surged on 9.9x from 1.1x to 11.0x in FY2016. Debt surged on 48.1% while cash decreased on 3.3%.
Hinduja Ventures has short term refinancing risk: cash is only 22.2% of short term debt.
Financial and operational results
Hinduja Ventures ($HINDUJAVEN) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 4,489 | 5,914 | 7,666 | 13,935 | 6,606 | -52.6% |
| EBITDA | 1,245 | 1,245 | 1,395 | 7,623 | 1,129 | -85.2% |
| Net Income | 1,005 | 802 | 2 | 6,053 | -812 | -113.4% |
Balance Sheet
|
|---|
| Cash | 351 | 485 | 561 | 842 | 814 | -3.3% |
| Short Term Debt | 679 | 1,483 | 2,149 | 1,450 | 3,666 | 152.9% |
| Long Term Debt | 598 | 6,389 | 6,292 | 7,484 | 9,570 | 27.9% |
Cash flow
|
|---|
| Capex | 522 | 3,889 | 1,091 | 988 | 4,294 | 334.8% |
Ratios
|
|---|
| Revenue growth | 25.6% | 31.8% | 29.6% | 81.8% | -52.6% | |
| EBITDA growth | 55.0% | -0.0% | 12.1% | 446.3% | -85.2% | |
|
|---|
| EBITDA Margin | 27.7% | 21.0% | 18.2% | 54.7% | 17.1% | -37.6% |
| Net Income Margin | 22.4% | 13.6% | 0.0% | 43.4% | -12.3% | -55.7% |
| CAPEX, % of revenue | 11.6% | 65.8% | 14.2% | 7.1% | 65.0% | 57.9% |
|
|---|
| ROIC | 8.3% | 4.0% | 1.0% | 39.5% | 1.3% | -38.2% |
| ROE | 14.3% | 10.3% | 0.0% | 78.3% | -11.4% | -89.7% |
| Net Debt/EBITDA | 0.7x | 5.9x | 5.6x | 1.1x | 11.0x | 9.9x |
Peers in Broadcasting & Cable TV
Below you can find Hinduja Ventures benchmarking vs. other companies in Broadcasting & Cable TV 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 |
|---|
| Zee Media Corporation ($ZEEMEDIA) | 10.6% | -1.7% | 11.3% | 62.6% | - |
| Siti Cable Network ($SITICABLE) | 12.0% | 37.0% | 41.6% | 36.2% | - |
| Tv18 Broadcast ($TV18BRDCST) | - | 21.4% | 16.4% | 17.8% | 10.8% |
| Entertainment Network (India) ($ENIL) | -32.9% | 9.2% | 13.2% | 14.0% | - |
| Zee Entertainment Enterprises ($ZEEL) | - | 21.7% | 18.6% | 11.5% | 19.9% |
| |
|---|
| Median (9 companies) | 10.6% | 9.2% | 18.6% | 11.5% | 15.4% |
|---|
| Hinduja Ventures ($HINDUJAVEN) | - | 31.8% | 29.6% | 81.8% | -52.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Entertainment Network (India) ($ENIL) | 32.1% | 30.8% | 32.4% | 33.3% | - |
| Raj Television Network ($RAJTV) | - | - | - | 29.6% | - |
| Dish Tv India ($DISHTV) | 25.5% | 27.3% | 26.4% | 28.1% | - |
| Zee Entertainment Enterprises ($ZEEL) | 24.4% | 25.9% | 27.6% | 25.7% | 25.8% |
| Sea Tv Network ($SEATV) | - | - | - | 24.1% | - |
| |
|---|
| Median (11 companies) | 7.3% | 17.5% | 19.9% | 15.9% | 18.1% |
|---|
| Hinduja Ventures ($HINDUJAVEN) | 27.7% | 21.0% | 18.2% | 54.7% | 17.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Siti Cable Network ($SITICABLE) | 10.6% | 80.9% | 73.0% | 32.5% | - |
| Den Networks ($DEN) | 12.6% | 60.4% | 53.2% | 28.5% | - |
| Dish Tv India ($DISHTV) | 33.5% | 32.2% | 11.9% | 26.3% | - |
| Balaji Telefilms ($BALAJITELE) | 2.4% | 1.3% | 0.6% | 4.3% | - |
| Tv18 Broadcast ($TV18BRDCST) | 3.5% | 2.3% | 3.1% | 4.1% | 4.3% |
| |
|---|
| Median (9 companies) | 3.5% | 4.1% | 7.7% | 4.1% | 4.8% |
|---|
| Hinduja Ventures ($HINDUJAVEN) | 11.6% | 65.8% | 14.2% | 7.1% | 65.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dish Tv India ($DISHTV) | -2.5% | -4.6% | 8.7% | 24.0% | - |
| Zee Entertainment Enterprises ($ZEEL) | 21.1% | 24.2% | 25.5% | 22.1% | 23.6% |
| Entertainment Network (India) ($ENIL) | 15.2% | 14.8% | 16.7% | 17.9% | - |
| Raj Television Network ($RAJTV) | 10.1% | 10.3% | 11.5% | 9.1% | - |
| Tv18 Broadcast ($TV18BRDCST) | -6.4% | 2.7% | 4.0% | 5.3% | 5.2% |
| |
|---|
| Median (12 companies) | 0.7% | 3.3% | 5.4% | 5.3% | 14.4% |
|---|
| Hinduja Ventures ($HINDUJAVEN) | 8.3% | 4.0% | 1.0% | 39.5% | 1.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Zee Media Corporation ($ZEEMEDIA) | 0.2x | 0.3x | 3.0x | 10.1x | - |
| Siti Cable Network ($SITICABLE) | 56.0x | 9.5x | 5.6x | 6.7x | - |
| Den Networks ($DEN) | -0.5x | 2.4x | 1.7x | 6.0x | - |
| Dish Tv India ($DISHTV) | 2.1x | 2.6x | 2.0x | 1.4x | - |
| Tv18 Broadcast ($TV18BRDCST) | - | 2.4x | 0.9x | 1.3x | 1.4x |
| |
|---|
| Median (10 companies) | -0.4x | 1.5x | 1.6x | 1.1x | 0.4x |
|---|
| Hinduja Ventures ($HINDUJAVEN) | 0.7x | 5.9x | 5.6x | 1.1x | 11.0x |
