Gujarat Fluorochemicals CAPEX jumped on 86.6% and Revenue surged on 35.0%
16-05-2016 • About Gujarat Fluorochemicals (
$GUJFLUORO) • By InTwits
Gujarat Fluorochemicals reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Gujarat Fluorochemicals is a fast growth stock: FY2016 revenue growth was 35.0%, 5 year revenue CAGR was 37.6% at FY2016 ROIC 11.7%
- EBITDA Margin is quite volatile: 18.3% in FY2016, 19.6% in FY2015, 18.1% in FY2014, 35.2% in FY2013, 47.7% in FY2012
- Gujarat Fluorochemicals has high CAPEX intensity: 5 year average CAPEX/Revenue was 19.6%. At the same time it's a lot of higher than industry average of 11.2%.
- CAPEX is quite volatile: ₹7,977m in FY2016, ₹4,276m in FY2015, ₹4,239m in FY2014, ₹7,529m in FY2013, ₹12,117m in FY2012
- The company has business model with average profitability: ROIC is 11.7%
- It operates with medium-size leverage: Net Debt/EBITDA is 1.9x while industry average is 1.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Gujarat Fluorochemicals's Revenue jumped on 35.0%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.3 pp from 13.7% to 16.0% in FY2016. EBITDA Margin declined at -7.4 pp per annum in the last 5 years.
Net Income margin decreased on 5.6 pp from 11.1% to 5.5% in FY2016.
Investments (CAPEX, working capital and M&A)
Gujarat Fluorochemicals's CAPEX/Revenue was 11.2% in FY2016. The company's CAPEX/Revenue dropped on 12.6 pp from 23.8% in FY2013 to 11.2% in FY2016. Average CAPEX/Revenue for the last three years was 10.5%. To deliver its fast growth the company invested a large share of EBITDA (61.2%) to CAPEX. CAPEX as a % of Revenue stuck to a declining trend at -7.9 pp per annum in the last 5 years.
Return on investment
The company operates at low ROIC (11.7%) and ROE (9.0%). ROIC increased slightly on 0.99 pp from 10.7% to 11.7% in FY2016. ROE decreased on 6.5 pp from 15.5% to 9.0% in FY2016. During FY2012-FY2016 ROIC bottomed in FY2014 at 7.2% and was growing since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.9x and Debt / EBITDA is 2.3x. Net Debt / EBITDA surged on 0.5x from 1.4x to 1.9x in FY2016. Debt jumped on 17.2% while cash dropped on 49.6%.
Gujarat Fluorochemicals has short term refinancing risk: cash is only 28.9% of short term debt.
Financial and operational results
Gujarat Fluorochemicals ($GUJFLUORO) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 28,302 | 31,664 | 34,515 | 52,772 | 71,242 | 35.0% |
| EBITDA | 13,504 | 11,141 | 6,250 | 10,352 | 13,044 | 26.0% |
| Net Income | 7,801 | 5,434 | 1,861 | 5,853 | 3,939 | -32.7% |
Balance Sheet
|
|---|
| Cash | 2,837 | 523 | 265 | 11,152 | 5,621 | -49.6% |
| Short Term Debt | 6,460 | 9,259 | 10,551 | 14,296 | 19,441 | 36.0% |
| Long Term Debt | 8,957 | 12,085 | 12,472 | 11,358 | 10,625 | -6.5% |
Cash flow
|
|---|
| Capex | 12,117 | 7,529 | 4,239 | 4,276 | 7,977 | 86.6% |
Ratios
|
|---|
| Revenue growth | 96.0% | 11.9% | 9.0% | 52.9% | 35.0% | |
| EBITDA growth | 238.0% | -17.5% | -43.9% | 65.6% | 26.0% | |
|
|---|
| EBITDA Margin | 47.7% | 35.2% | 18.1% | 19.6% | 18.3% | -1.3% |
| Net Income Margin | 27.6% | 17.2% | 5.4% | 11.1% | 5.5% | -5.6% |
| CAPEX, % of revenue | 42.8% | 23.8% | 12.3% | 8.1% | 11.2% | 3.1% |
|
|---|
| ROIC | 31.7% | 18.4% | 7.2% | 10.7% | 11.7% | 1.0% |
| ROE | 33.7% | 18.5% | 5.8% | 15.5% | 9.0% | -6.5% |
| Net Debt/EBITDA | 0.9x | 1.9x | 3.6x | 1.4x | 1.9x | 0.5x |
Peers in Industrial Gases
Below you can find Gujarat Fluorochemicals benchmarking vs. other companies in Industrial Gases 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 EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| National Oxygen ($NOL) | - | - | - | -4.8% | - |
| |
|---|
| Median (1 company) | - | - | - | -4.8% | - |
|---|
| Gujarat Fluorochemicals ($GUJFLUORO) | 47.7% | 35.2% | 18.1% | 19.6% | 18.3% |
Top companies by ROIC, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| National Oxygen ($NOL) | 9.7% | - | - | - | - |
| |
|---|
| Median (1 company) | 9.7% | - | - | - | - |
|---|
| Gujarat Fluorochemicals ($GUJFLUORO) | 31.7% | 18.4% | 7.2% | 10.7% | 11.7% |
