Emmbi Industries reports 77.6% Net Income growth in 2016

17-05-2016 • About Emmbi Industries ($EMMBI) • By InTwits

Emmbi Industries reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:

• Emmbi Industries is a fast growth stock: FY2016 revenue growth was 13.3%, 5 year revenue CAGR was 22.4% at FY2016 ROIC
• It operates with high leverage: Net Debt/EBITDA is 2.3x while industry average is 1.1x

Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.

Revenue and profitability

Emmbi Industries's Revenue jumped on 13.3%. Revenue decline was accelerating on average at -6.6 pp per annum in FY2012-FY2016.

Net Income margin increased slightly on 1.9 pp from 3.3% to 5.1% in FY2016. During the last 5 years Net Income margin bottomed in FY2013 at 2.3% and was growing since that time.

Leverage (Debt)

Debt level is 2.3x Net Debt / EBITDA and 2.3x Debt / EBITDA. Net Debt / EBITDA surged2.3x from to 2.3x in FY2016. Debt surged while cash surged.

Emmbi Industries has short term refinancing risk: cash is only 1.9% of short term debt.

Valuation and dividends

The company's trades at EV/EBITDA 9.0x and P/E 16.3x while industy averages are 17.8x and 21.9x.

Financial and operational results

Emmbi Industries ($EMMBI) key annual financial indicators

mln. INR	2012	2013	2014	2015	2016	2016/2015
P&L
Revenue	1,023	1,397	1,591	1,826	2,069	13.3%
EBITDA	99	126	154		257
Net Income	33	32	43	60	106	77.6%
Balance Sheet
Cash	8	4			10
Short Term Debt	413	474			539
Long Term Debt	46	84			52
Cash flow
Capex	119
Ratios
Revenue growth	35.6%	36.6%	13.9%	14.8%	13.3%
EBITDA growth	39.6%	27.4%	22.1%
EBITDA Margin	9.7%	9.0%	9.7%		12.4%
Net Income Margin	3.2%	2.3%	2.7%	3.3%	5.1%	1.9%
CAPEX, % of revenue	11.6%
ROIC	9.1%	9.4%
ROE	6.8%	6.2%
Net Debt/EBITDA	4.6x	4.4x	0.0x		2.3x

Peers in Containers & Packaging

Below you can find Emmbi Industries benchmarking vs. other companies in Containers & Packaging 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
Control Print ($CONTROLPR)	-	20.0%	14.1%	23.9%	-
Shri Jagdamba Polymers ($SHRJAGP)	35.5%	38.3%	21.7%	22.7%	-
Kg Petrochem ($KGPETRO)	16.1%	24.0%	20.9%	22.4%	-
Kanpur Plastipack ($KANPRPLA)	57.2%	-4.6%	21.1%	15.9%	-
Time Technoplast ($TIMETECHNO)	19.8%	17.6%	21.6%	13.3%	-
Median (19 companies)	18.0%	15.3%	14.1%	8.4%	-3.7%
Emmbi Industries ($EMMBI)	-	36.6%	13.9%	14.8%	13.3%

Top companies by EBITDA margin, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Control Print ($CONTROLPR)	13.9%	19.2%	22.5%	25.2%	-
Manaksia ($MANAKSIA)	14.4%	17.4%	20.3%	18.6%	-
Essel Propack ($ESSELPRO)	17.0%	17.4%	16.9%	17.2%	19.4%
Time Technoplast ($TIMETECHNO)	15.9%	16.2%	14.1%	13.7%	-
Piramal Glass ($PIRAMGLAS)	23.7%	18.9%	15.5%	13.5%	-
Median (23 companies)	12.9%	11.3%	12.2%	8.9%	16.8%

Top companies by CAPEX/Revenue, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Control Print ($CONTROLPR)	3.0%	5.0%	7.5%	11.9%	-
Essel Propack ($ESSELPRO)	10.0%	6.7%	8.5%	9.4%	8.9%
Manaksia ($MANAKSIA)	9.0%	4.8%	4.7%	6.5%	-
Piramal Glass ($PIRAMGLAS)	20.7%	6.0%	7.7%	4.6%	-
Time Technoplast ($TIMETECHNO)	17.9%	11.1%	6.2%	4.2%	-
Median (7 companies)	8.6%	6.7%	6.7%	4.6%	8.9%

Top companies by ROIC, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Control Print ($CONTROLPR)	-	19.7%	22.2%	25.2%	-
Essel Propack ($ESSELPRO)	8.6%	9.9%	12.5%	14.7%	16.6%
Time Technoplast ($TIMETECHNO)	12.8%	13.4%	12.0%	12.9%	-
Manaksia ($MANAKSIA)	12.9%	15.5%	16.0%	11.4%	-
Uflex ($UFLEX)	12.5%	9.9%	8.1%	8.4%	-
Median (32 companies)	9.4%	9.9%	11.6%	11.4%	16.6%
Emmbi Industries ($EMMBI)	9.1%	9.4%	-	-	-

Top companies by Net Debt / EBITDA

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Hindusthan National Glass & Industries ($HINDNATGLS)	7.4x	15.8x	11.2x	10.6x	-
Piramal Glass ($PIRAMGLAS)	3.1x	4.1x	4.3x	4.2x	-
Uflex ($UFLEX)	2.7x	3.0x	3.2x	2.8x	-
Essel Propack ($ESSELPRO)	3.2x	2.9x	2.6x	2.2x	1.6x
Time Technoplast ($TIMETECHNO)	2.6x	2.6x	2.6x	2.2x	-
Median (21 companies)	3.2x	3.3x	2.0x	0.0x	0.0x

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