Honda Siel Power Products reports 26.4% Net Income growth in 2016 and 2.2 pp EBITDA Margin growth from 11.1% to 13.3%
20-05-2016 • About Honda Siel Power Products (
$HONDAPOWER) • By InTwits
Honda Siel Power Products reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 13.3% in FY2016 vs. 11.1% in FY2015 vs. 10.3% in FY2012
- Honda Siel Power Products has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.9%. At the same time it's in pair with industry average of 4.3%
- CAPEX is quite volatile: ₹128m in FY2016, ₹271m in FY2015, ₹201m in FY2014, ₹414m in FY2013, ₹335m in FY2012
- The company has highly profitable business model: ROIC is 18.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Honda Siel Power Products's Revenue increased on 4.7%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.9 pp from 16.9% to 18.8% in FY2016. During the last 5 years EBITDA Margin bottomed in FY2013 at 7.4% and was growing since that time.
Net Income margin increased slightly on 1.3 pp from 6.1% to 7.4% in FY2016. During the last 5 years Net Income margin bottomed in FY2014 at 3.5% and was growing since that time.
Investments (CAPEX, working capital and M&A)
Honda Siel Power Products's CAPEX/Revenue was 1.9% in FY2016. Honda Siel Power Products showed decline in CAPEX/Revenue of 6.1 pp from 8.0% in FY2013 to 1.9% in FY2016. It's average CAPEX/Revenue for the last three years was 3.3%.
Return on investment
The company operates at good ROIC (18.3%) and ROE (14.1%). ROIC increased on 2.9 pp from 15.3% to 18.3% in FY2016. ROE increased slightly on 1.6 pp from 12.5% to 14.1% in FY2016. During FY2012-FY2016 ROIC bottomed in FY2013 at 8.8% and was growing since that time. During the last 5 years ROE bottomed in FY2014 at 6.5% and was growing since that time.
Leverage (Debt)
The company has no debt. Cash jumped on 144%.
Valuation and dividends
The company's trades at EV/EBITDA 12.8x and P/E 26.2x while industy averages are 17.8x and 21.9x. The company's EV/(EBITDA-CAPEX) is 15.0x with the industry average at 22.8x.
Management team
Yoshifumi Lida is a Honda Siel Power Products's CEO. Yoshifumi Lida has spent 5 years with the company. The company's CFO is Vinay Mittal. Vinay Mittal has 14 years tenure at the company.
Financial and operational results
Honda Siel Power Products ($HONDAPOWER) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 5,034 | 5,155 | 5,413 | 6,307 | 6,604 | 4.7% |
| EBITDA | 516 | 380 | 520 | 701 | 880 | 25.6% |
| Net Income | 517 | 206 | 188 | 386 | 488 | 26.4% |
Balance Sheet
|
|---|
| Cash | 265 | 222 | 208 | 635 | 1,551 | 144.1% |
| Short Term Debt | 0 | 0 | 0 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 335 | 414 | 201 | 271 | 128 | -52.6% |
Ratios
|
|---|
| Revenue growth | 28.1% | 2.4% | 5.0% | 16.5% | 4.7% | |
| EBITDA growth | 15.1% | -26.3% | 36.6% | 34.9% | 25.6% | |
|
|---|
| EBITDA Margin | 10.3% | 7.4% | 9.6% | 11.1% | 13.3% | 2.2% |
| Net Income Margin | 10.3% | 4.0% | 3.5% | 6.1% | 7.4% | 1.3% |
| CAPEX, % of revenue | 6.7% | 8.0% | 3.7% | 4.3% | 1.9% | -2.4% |
|
|---|
| ROIC | 16.9% | 8.8% | 11.5% | 15.3% | 18.3% | 2.9% |
| ROE | 21.2% | 7.6% | 6.5% | 12.5% | 14.1% | 1.6% |
| Net Debt/EBITDA | -0.5x | -0.6x | -0.4x | -0.9x | -1.8x | -0.9x |
Peers in Industrial Machinery
Below you can find Honda Siel Power Products benchmarking vs. other companies in Industrial Machinery 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 |
|---|
| Lloyd Electric & Engineering ($LLOYDELENG) | - | - | - | 22.3% | 27.3% |
| Kabra Extrusiontechnik ($KABRAEXTRU) | -13.3% | -8.7% | 28.4% | 21.6% | - |
| Akar Tools ($AKARTOOL) | 21.1% | 2.1% | -2.3% | 16.7% | - |
| Mazda ($MAZDALTD) | 22.1% | 14.7% | -15.6% | 16.2% | - |
| Abc Bearings ($ABCBEARS) | - | -15.5% | -6.6% | 15.7% | 10.3% |
| |
|---|
| Median (27 companies) | 20.1% | 2.1% | -1.2% | 3.3% | -3.3% |
|---|
| Honda Siel Power Products ($HONDAPOWER) | - | 2.4% | 5.0% | 16.5% | 4.7% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Bell Agromachina ($BELAGRO) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| |
|---|
| Median (1 company) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Texmaco Infrastructure & Holdings ($TEXINFRA) | - | - | - | 40.5% | - |
| Dhp India ($DHPIND) | - | - | - | 26.3% | - |
| Shilp Gravures ($SHILGRAVQ) | - | - | - | 19.4% | - |
| Solitaire Machine Tools ($SOLIMAC) | - | - | - | 19.4% | - |
| Wendt (India) ($WENDT) | 28.3% | 21.6% | 18.6% | 19.0% | 16.5% |
| |
|---|
| Median (43 companies) | 11.3% | 9.5% | 10.5% | 10.2% | 11.7% |
|---|
| Honda Siel Power Products ($HONDAPOWER) | 10.3% | 7.4% | 9.6% | 11.1% | 13.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Texmaco Infrastructure & Holdings ($TEXINFRA) | - | - | - | 14.0% | - |
| Wendt (India) ($WENDT) | 13.5% | 9.0% | 8.8% | 9.4% | 9.3% |
| Ingersoll-Rand (India) ($INGERRAND) | 4.3% | 10.9% | 3.6% | 9.2% | - |
| Kabra Extrusiontechnik ($KABRAEXTRU) | 6.5% | 1.8% | 0.5% | 8.8% | - |
| Forbes & Company ($FORBESCO) | 1.8% | 2.6% | 3.0% | 5.1% | - |
| |
|---|
| Median (21 companies) | 5.6% | 3.8% | 2.7% | 3.1% | 2.2% |
|---|
| Honda Siel Power Products ($HONDAPOWER) | 6.7% | 8.0% | 3.7% | 4.3% | 1.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Greaves Cotton ($GREAVESCOT) | - | 24.8% | 16.3% | 26.7% | 25.7% |
| Gmm Pfaudler ($GMM) | -76.2% | 6.8% | 17.4% | 18.2% | 16.1% |
| Lakshmi Machine Works ($LAXMIMACH) | 18.0% | 11.7% | 16.2% | 17.6% | - |
| Wendt (India) ($WENDT) | 38.2% | 20.2% | 16.2% | 15.1% | 12.6% |
| Dynamatic Technologies ($DYNAMATECH) | 13.8% | 11.0% | 13.2% | 13.9% | - |
| |
|---|
| Median (52 companies) | 12.8% | 10.9% | 9.2% | 12.1% | 9.8% |
|---|
| Honda Siel Power Products ($HONDAPOWER) | 16.9% | 8.8% | 11.5% | 15.3% | 18.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Forbes & Company ($FORBESCO) | 2.2x | 3.3x | 4.7x | 6.3x | - |
| Nitin Fire Protection Industries ($NITINFIRE) | 3.6x | 3.5x | 3.0x | 3.7x | - |
| Elgi Equipments ($ELGIEQUIP) | -1.2x | 2.3x | 2.7x | 3.3x | - |
| Lloyd Electric & Engineering ($LLOYDELENG) | - | - | 3.7x | 3.2x | 2.7x |
| Elecon Engineering Co ($ELECON) | 3.0x | 3.2x | 4.0x | 3.1x | 3.9x |
| |
|---|
| Median (34 companies) | 0.9x | 1.5x | 0.0x | 0.0x | 0.0x |
|---|
| Honda Siel Power Products ($HONDAPOWER) | -0.5x | -0.6x | -0.4x | -0.9x | -1.8x |
