Indian Hume Pipe Co EBITDA dropped on 11.5% and Revenue decreased on 7.2%
19-05-2016 • About Indian Hume Pipe Co (
$INDIANHUME) • By InTwits
Indian Hume Pipe Co reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Indian Hume Pipe Co has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's a lot of higher than industry average of 1.2%.
- CAPEX is quite volatile: ₹287m in FY2016, ₹221m in FY2015, ₹909m in FY2014, ₹597m in FY2013, ₹409m in FY2012
- The company has highly profitable business model: ROIC is 14.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Indian Hume Pipe Co's Revenue decreased on 7.2%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 0.51 pp from 11.0% to 10.5% in FY2016. EBITDA Margin grew at 0.92 pp per annum in the last 5 years.
Net Income margin decreased slightly on 1.0 pp from 4.1% to 3.1% in FY2016.
Investments (CAPEX, working capital and M&A)
Indian Hume Pipe Co's CAPEX/Revenue was 1.1% in FY2016. Indian Hume Pipe Co showed small CAPEX/Revenue decline of 0.92 pp from 2.0% in FY2013 to 1.1% in FY2016. Average CAPEX/Revenue for the last three years was 1.1%.
Return on investment
The company operates at good ROIC (14.5%) while ROE is low (9.8%). ROIC decreased on 3.5 pp from 18.0% to 14.5% in FY2016. ROE decreased on 5.6 pp from 15.4% to 9.8% in FY2016. During the last 5 years ROIC topped in FY2015 at 18.0%.
Leverage (Debt)
Company's Net Debt / EBITDA is 3.2x and Debt / EBITDA is 3.2x. Net Debt / EBITDA jumped on 0.6x from 2.6x to 3.2x in FY2016. Debt increased on 4.0% while cash dropped on 64.7%.
Indian Hume Pipe Co has short term refinancing risk: cash is only 2.6% of short term debt.
Valuation and dividends
The company's trades at EV/EBITDA 11.7x and P/E 28.9x while industy averages are 17.8x and 21.9x. Indian Hume Pipe Co's EV/(EBITDA-CAPEX) is 13.1x with the industry average at 22.8x.
Financial and operational results
Indian Hume Pipe Co ($INDIANHUME) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 5,172 | 6,958 | 8,230 | 10,099 | 9,369 | -7.2% |
| EBITDA | 359 | 615 | 767 | 1,110 | 982 | -11.5% |
| Net Income | 159 | 228 | 241 | 416 | 291 | -30.0% |
Balance Sheet
|
|---|
| Cash | 213 | 174 | 124 | 221 | 78 | -64.7% |
| Short Term Debt | 1,485 | 1,764 | 2,175 | 2,849 | 3,042 | 6.8% |
| Long Term Debt | 0 | 0 | 281 | 206 | 136 | -33.8% |
Cash flow
|
|---|
| Capex | 98 | 142 | 130 | 75 | 106 | 40.5% |
Ratios
|
|---|
| Revenue growth | -20.3% | 34.5% | 18.3% | 22.7% | -7.2% | |
| EBITDA growth | -47.3% | 71.2% | 24.6% | 44.7% | -11.5% | |
|
|---|
| EBITDA Margin | 7.0% | 8.8% | 9.3% | 11.0% | 10.5% | -0.5% |
| Net Income Margin | 3.1% | 3.3% | 2.9% | 4.1% | 3.1% | -1.0% |
| CAPEX, % of revenue | 1.9% | 2.0% | 1.6% | 0.7% | 1.1% | 0.4% |
|
|---|
| ROIC | 7.6% | 13.8% | 15.0% | 18.0% | 14.5% | -3.5% |
| ROE | 7.4% | 10.0% | 9.8% | 15.4% | 9.8% | -5.6% |
| Net Debt/EBITDA | 3.5x | 2.6x | 3.0x | 2.6x | 3.2x | 0.6x |
Peers in Cement & Cement Products
Below we provide Indian Hume Pipe Co benchmarking against other companies in Cement & Cement Products 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 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ncl Industries ($NCLIND) | 38.2% | -15.8% | -3.0% | 30.8% | - |
| J.K.Cement ($JKCEMENT) | 21.8% | 14.7% | -4.0% | 21.2% | - |
| Visaka Industries ($VIKASAS) | - | 22.0% | -2.6% | 13.6% | -0.8% |
| Prism Cement ($PRISMCEM) | 33.2% | 4.9% | 5.3% | 12.5% | - |
| K.C.P ($KCP) | 54.3% | 11.7% | -8.2% | 12.4% | - |
| |
|---|
| Median (16 companies) | 21.8% | 11.4% | -1.6% | 6.2% | -0.8% |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | - | 34.5% | 18.3% | 22.7% | -7.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Orient Cement ($ORIENTCEM) | - | 21.5% | 15.0% | 19.8% | 12.2% |
| Saurashtra Cement ($SAURASHCEM) | 11.4% | 21.6% | 11.9% | 16.8% | - |
| Ambuja Cements ($AMBUJACEM) | 25.6% | 18.2% | 19.4% | 16.4% | - |
| India Cements ($INDIACEM) | 20.6% | 18.4% | 12.4% | 15.1% | - |
| Deccan Cements ($DECCANCE) | 22.8% | 13.2% | 14.7% | 14.9% | - |
| |
|---|
| Median (15 companies) | 19.2% | 14.1% | 11.9% | 13.0% | 9.5% |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | 7.0% | 8.8% | 9.3% | 11.0% | 10.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Udaipur Cement Works ($UDAICEMENT) | - | - | - | 91.1% | - |
| Orient Cement ($ORIENTCEM) | - | 2.9% | - | 59.7% | 24.5% |
| J.K.Cement ($JKCEMENT) | 6.5% | 18.8% | 55.8% | 16.2% | - |
| Acc ($ACC) | 5.0% | 8.6% | 13.7% | 9.5% | - |
| Birla Corporation ($BIRLACORPN) | 19.1% | 7.1% | 5.5% | 6.9% | 5.1% |
| |
|---|
| Median (12 companies) | 6.5% | 7.2% | 8.3% | 5.9% | 5.1% |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | 1.9% | 2.0% | 1.6% | 0.7% | 1.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Saurashtra Cement ($SAURASHCEM) | 38.6% | 42.7% | 13.9% | 26.9% | - |
| Orient Cement ($ORIENTCEM) | - | 57.3% | 15.2% | 15.4% | 4.6% |
| Acc ($ACC) | 20.2% | 12.7% | 11.0% | 9.9% | - |
| K.C.P ($KCP) | 17.6% | 6.7% | 7.1% | 9.3% | - |
| Deccan Cements ($DECCANCE) | 17.4% | 8.0% | 6.4% | 9.1% | - |
| |
|---|
| Median (17 companies) | 15.8% | 8.3% | 6.4% | 8.1% | 3.9% |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | 7.6% | 13.8% | 15.0% | 18.0% | 14.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Udaipur Cement Works ($UDAICEMENT) | - | - | - | 17.1x | 358.6x |
| Heidelbergcement India ($HEIDELBERG) | 14.0x | 12.2x | 0.0x | 10.4x | - |
| Prism Cement ($PRISMCEM) | 4.8x | 6.0x | 10.0x | 6.0x | - |
| J.K.Cement ($JKCEMENT) | 2.3x | 2.3x | 6.9x | 5.8x | - |
| India Cements ($INDIACEM) | 3.2x | 3.5x | 5.5x | 4.6x | - |
| |
|---|
| Median (14 companies) | 1.8x | 2.6x | 2.7x | 2.7x | 5.1x |
|---|
| Indian Hume Pipe Co ($INDIANHUME) | 3.5x | 2.6x | 3.0x | 2.6x | 3.2x |
