Rane Engine Valve Net Debt / EBITDA jumped on 20.6x from 4.8x to 25.4x in 2016 while Revenue decreased on 9.8%
19-05-2016 • About Rane Engine Valve (
$RANENGIN) • By InTwits
Rane Engine Valve reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is quite volatile: 1.6% in FY2016, 8.1% in FY2015, 11.9% in FY2014, 3.5% in FY2013, 15.4% in FY2012
- Rane Engine Valve has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.3%. At the same time it's in pair with industry average of 9.5%
- CAPEX is quite volatile: ₹126m in FY2016, ₹239m in FY2015, ₹107m in FY2014, ₹289m in FY2013, ₹350m in FY2012
- The company has unprofitable business model: ROIC is -8.7%
- It operates with high leverage: Net Debt/EBITDA is 25.4x while industry average is 11.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Rane Engine Valve's Revenue decreased on 9.8%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 6.5 pp from 8.1% to 1.6% in FY2016.
Net Income margin decreased on 9.6 pp from 6.1% to -3.6% in FY2016.
Investments (CAPEX, working capital and M&A)
In FY2016 Rane Engine Valve had CAPEX/Revenue of 3.6%. CAPEX/Revenue decreased on 7.4 pp from 11.0% in FY2013 to 3.6% in FY2016. It's average CAPEX/Revenue for the last three years was 4.6%. Battling declining revenue Rane Engine Valve made large investments to CAPEX (226% of EBITDA) but that didn't help at least in this year. CAPEX as a % of Revenue followed a declining trend at -2.0 pp per annum in FY2012-FY2016.
Return on investment
The company operates at negative ROIC (-8.7%) and ROE (-11.5%). ROIC decreased on 10.0 pp from 1.3% to -8.7% in FY2016. ROE dropped on 37.8 pp from 26.3% to -11.5% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 25.4x and Debt / EBITDA is 25.7x. Net Debt / EBITDA surged on 20.6x from 4.8x to 25.4x in FY2016. Debt decreased on 6.7% while cash dropped on 26.6%.
Rane Engine Valve has short term refinancing risk: cash is only 1.7% of short term debt.
Financial and operational results
Rane Engine Valve ($RANENGIN) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 3,070 | 2,628 | 2,595 | 3,876 | 3,496 | -9.8% |
| EBITDA | 473 | 93 | 309 | 315 | 56 | -82.3% |
| Net Income | 208 | -126 | -291 | 235 | -125 | -153.4% |
Balance Sheet
|
|---|
| Cash | 26 | 64 | 30 | 18 | 14 | -26.6% |
| Short Term Debt | 606 | 514 | 644 | 950 | 813 | -14.4% |
| Long Term Debt | 392 | 592 | 770 | 582 | 615 | 5.7% |
Cash flow
|
|---|
| Capex | 350 | 289 | 107 | 239 | 126 | -47.4% |
Ratios
|
|---|
| Revenue growth | 6.5% | -14.4% | -1.2% | 49.3% | -9.8% | |
| EBITDA growth | 7.1% | -80.4% | 233.8% | 1.7% | -82.3% | |
|
|---|
| EBITDA Margin | 15.4% | 3.5% | 11.9% | 8.1% | 1.6% | -6.5% |
| Net Income Margin | 6.8% | -4.8% | -11.2% | 6.1% | -3.6% | -9.6% |
| CAPEX, % of revenue | 11.4% | 11.0% | 4.1% | 6.2% | 3.6% | -2.6% |
|
|---|
| ROIC | 14.5% | -5.7% | 5.3% | 1.3% | -8.7% | -10.0% |
| ROE | 21.3% | -12.8% | -37.6% | 26.3% | -11.5% | -37.8% |
| Net Debt/EBITDA | 2.1x | 11.3x | 4.5x | 4.8x | 25.4x | 20.6x |
Peers in
Below we provide Rane Engine Valve benchmarking against other companies in 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 |
|---|
| Indbulbbph ($INDBULBBPH) | - | -6.5% | 33.5% | 49.2% | 0.9% |
| Monetbbph ($MONETBBPH) | 22.3% | 3.7% | 11.6% | 40.8% | - |
| Asleyf ($ASLEYF) | 15.5% | -3.3% | -8.0% | 33.6% | - |
| Bharat Rasayan ($BHARATRA) | 51.3% | 32.1% | 92.7% | 21.4% | - |
| Jklakbbph ($JKLAKBBPH) | - | 19.6% | 0.0% | 12.2% | 14.0% |
| |
|---|
| Median (17 companies) | 17.4% | 11.0% | 3.9% | 8.8% | 5.3% |
|---|
| Rane Engine Valve ($RANENGIN) | - | -14.4% | -1.2% | 49.3% | -9.8% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jenson & Nicholson Financial Services ($JNFSL) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| Bombay Drugs & Pharmas ($BOMDRDM) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| Southern Herbals ($SOUTHNHE) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| Tafnccpeq ($TAFNCCPEQ) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| |
|---|
| Median (4 companies) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oswal Chemicals & Fertilizers ($OSWALCHEM) | - | - | - | 53.4% | - |
| Kaleconbbph ($KALECONBBPH) | 27.7% | 44.3% | 43.5% | 37.9% | - |
| Paushak ($PAUSHAK) | - | - | - | 25.6% | - |
| The United Nilgiri Tea Estates Company ($UNITEDTEA) | - | - | - | 24.7% | - |
| Indbulbbph ($INDBULBBPH) | 36.7% | 34.6% | 29.5% | 23.5% | 28.7% |
| |
|---|
| Median (20 companies) | 15.4% | 14.9% | 15.8% | 10.8% | 9.8% |
|---|
| Rane Engine Valve ($RANENGIN) | 15.4% | 3.5% | 11.9% | 8.1% | 1.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Monetbbph ($MONETBBPH) | 131.4% | 5.2% | 139.2% | 89.2% | - |
| Jklakbbph ($JKLAKBBPH) | 28.5% | 28.8% | 24.6% | 23.6% | 17.5% |
| Rilbbph ($RILBBPH) | 4.6% | 7.7% | 13.8% | 16.9% | 18.0% |
| Gkw ($GKW) | - | - | - | 15.5% | - |
| Paushak ($PAUSHAK) | - | - | - | 12.3% | - |
| |
|---|
| Median (17 companies) | 8.6% | 5.2% | 4.9% | 5.0% | 2.9% |
|---|
| Rane Engine Valve ($RANENGIN) | 11.4% | 11.0% | 4.1% | 6.2% | 3.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Kaleconbbph ($KALECONBBPH) | - | 89.0% | 103.8% | 81.0% | - |
| Bharat Rasayan ($BHARATRA) | 22.1% | 13.7% | 21.9% | 26.1% | - |
| Uplbbph ($UPLBBPH) | 17.1% | 15.9% | 18.2% | 22.1% | 22.2% |
| Rane Brake Lining ($RANEBRAKE) | 14.1% | 7.9% | 11.1% | 12.8% | - |
| Merckbbph ($MERCKBBPH) | 21.3% | 13.1% | 8.6% | 10.6% | - |
| |
|---|
| Median (28 companies) | 8.4% | 7.7% | 6.6% | 4.9% | 1.5% |
|---|
| Rane Engine Valve ($RANENGIN) | 14.5% | -5.7% | 5.3% | 1.3% | -8.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Monetbbph ($MONETBBPH) | 9.8x | 16.3x | 27.4x | 140.3x | - |
| Indbulbbph ($INDBULBBPH) | 4.3x | 4.8x | 5.5x | 9.6x | 6.5x |
| Jklakbbph ($JKLAKBBPH) | 2.1x | 2.3x | 5.3x | 5.5x | 8.3x |
| Asleyf ($ASLEYF) | 2.5x | 5.0x | 17.8x | 5.0x | - |
| Indian Metals & Ferro Alloys ($INDMETA-B) | 4.0x | 3.8x | 3.5x | 4.3x | 9.1x |
| |
|---|
| Median (16 companies) | 1.7x | 1.8x | 2.0x | 0.9x | 3.4x |
|---|
| Rane Engine Valve ($RANENGIN) | 2.1x | 11.3x | 4.5x | 4.8x | 25.4x |
