Welspun Projects reports 73.2% revenue decline in FY2016 and 5.3 pp EBITDA Margin decline from -0.23% to -5.6%
23-05-2016 • About Welspun Projects (
$WELPROJ) • By InTwits
Welspun Projects reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- The company operates at negative EBITDA Margin: -5.6%
- EBITDA Margin is quite volatile: -5.6% in FY2016, -0.2% in FY2015, 6.2% in FY2014, 34.0% in FY2013, 16.4% in FY2012
- The company has unprofitable business model: ROIC is -2.4%
- It operates with high leverage: Net Debt/EBITDA is 8.9x while industry average is 4.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 73.2%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.8 pp from 15.9% to 18.7% in FY2016. During the last 5 years EBITDA Margin topped in FY2013 at 34.0% and was declining since that time.
Net Income margin increased slightly on 0.70 pp from 0.082% to 0.78% in FY2016.
Return on investment
The company operates at negative ROIC (-2.4%) and low but positive ROE (0.1%). ROIC increased on 4.1 pp from -6.5% to -2.4% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 8.9x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2016. Debt dropped on 35.8% while cash dropped on 30.0%.
Welspun Projects has short term refinancing risk: cash is only 23.9% of short term debt.
Financial and operational results
Welspun Projects ($WELPROJ) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 3,370 | 3,071 | 2,434 | 8,256 | 2,209 | -73.2% |
| EBITDA | 552 | 1,044 | 151 | -19 | -123 | |
| Net Income | 33 | 59 | -610 | 7 | 17 | 156.4% |
Balance Sheet
|
|---|
| Cash | 634 | 281 | 107 | 554 | 388 | -30.0% |
| Short Term Debt | 986 | 779 | 698 | 1,411 | 1,620 | 14.9% |
| Long Term Debt | 2,949 | 2,240 | 2,547 | 3,066 | 1,254 | -59.1% |
Cash flow
|
|---|
| Capex | 13 | | 15 | 1,431 | | |
Ratios
|
|---|
| Revenue growth | 41.2% | -8.9% | -20.7% | 239.1% | -73.2% | |
| EBITDA growth | 929.4% | 89.2% | -85.6% | -112.4% | 554.1% | |
|
|---|
| EBITDA Margin | 16.4% | 34.0% | 6.2% | -0.2% | -5.6% | -5.3% |
| Net Income Margin | 1.0% | 1.9% | -25.1% | 0.1% | 0.8% | 0.7% |
| CAPEX, % of revenue | 0.4% | | 0.6% | 17.3% | | |
|
|---|
| ROIC | 3.4% | 4.1% | -2.5% | -6.5% | -2.4% | 4.1% |
| ROE | 0.6% | 1.1% | -12.5% | 0.1% | 0.1% | 0.0% |
| Net Debt/EBITDA | 6.0x | 2.6x | 20.8x | | |
Peers in Construction & Engineering
Below we provide Welspun Projects benchmarking against other companies in Construction & Engineering 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 |
|---|
| Thirthankar Infra ($THIRINFRA) | - | - | - | 258.2% | - |
| Itd Cementation India ($ITDCEM) | -3.7% | -4.0% | 8.5% | 79.2% | - |
| Mukand Engineers ($MUKANDENGG) | - | 16.7% | 12.4% | 63.0% | -20.2% |
| Atlanta ($ATLANTA) | -47.6% | 115.1% | 28.1% | 50.2% | - |
| Spml Infra ($SPMLINFRA) | -17.1% | 19.3% | 6.6% | 35.0% | - |
| |
|---|
| Median (32 companies) | 2.7% | 6.9% | 7.1% | -0.0% | -11.8% |
|---|
| Welspun Projects ($WELPROJ) | - | -8.9% | -20.7% | 239.1% | -73.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Madhucon Projects ($MADHUCON) | 8.4% | 31.9% | 22.1% | 32.1% | - |
| Jaiprakash Associates ($JPASSOCIAT) | 36.9% | 35.9% | 32.4% | 31.5% | - |
| Arss Infrastructure Projects ($ARSSINFRA) | 14.0% | 13.9% | 22.0% | 31.3% | - |
| Reliance Industrial Infrastructure ($RIIL) | - | - | - | 30.8% | - |
| Shristi Infrastructure Development Corporation ($SHRISTI) | 27.2% | 30.0% | 30.0% | 29.8% | - |
| |
|---|
| Median (36 companies) | 11.9% | 11.2% | 10.7% | 10.3% | 11.4% |
|---|
| Welspun Projects ($WELPROJ) | 16.4% | 34.0% | 6.2% | -0.2% | -5.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Madhucon Projects ($MADHUCON) | 234.5% | 155.1% | 76.0% | 67.4% | - |
| Supreme Infrastructure India ($SUPREMEINF) | 46.6% | 31.1% | 43.1% | 45.8% | - |
| Shristi Infrastructure Development Corporation ($SHRISTI) | 0.0% | 11.2% | 14.1% | 40.8% | - |
| Jaiprakash Associates ($JPASSOCIAT) | 97.0% | 65.5% | 45.0% | 31.6% | - |
| Man Infraconstruction ($MANINFRA) | 7.8% | 1.6% | 25.0% | 18.6% | 4.5% |
| |
|---|
| Median (23 companies) | 7.7% | 6.6% | 6.9% | 3.1% | 3.0% |
|---|
| Welspun Projects ($WELPROJ) | 0.4% | - | 0.6% | 17.3% | - |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skipper ($SKIPPER) | 10.4% | 13.5% | 14.7% | 27.4% | 24.4% |
| Voltas ($VOLTAS) | 19.6% | 11.7% | 11.8% | 19.3% | 18.2% |
| Coromandel Engineering Company ($COROENGG) | -21.9% | 3.4% | -0.3% | 15.0% | 7.9% |
| Mbl Infrastructures ($MBLINFRA) | 21.3% | 13.4% | 14.0% | 13.6% | - |
| Itd Cementation India ($ITDCEM) | 13.1% | 11.3% | 3.8% | 12.6% | - |
| |
|---|
| Median (42 companies) | 8.6% | 7.5% | 6.3% | 6.8% | 7.1% |
|---|
| Welspun Projects ($WELPROJ) | 3.4% | 4.1% | -2.5% | -6.5% | -2.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mcnally Bharat Engineering Company ($MBECL) | 4.3x | 7.0x | 7.6x | 28.3x | - |
| Jaiprakash Associates ($JPASSOCIAT) | 9.2x | 8.9x | 11.0x | 11.9x | - |
| Supreme Infrastructure India ($SUPREMEINF) | 6.0x | 6.1x | 6.8x | 11.3x | - |
| Madhucon Projects ($MADHUCON) | 96.8x | 19.0x | 16.4x | 9.8x | - |
| Shristi Infrastructure Development Corporation ($SHRISTI) | 11.8x | 8.6x | 7.9x | 9.4x | - |
| |
|---|
| Median (31 companies) | 4.5x | 5.7x | 5.9x | 3.0x | 2.1x |
|---|
