Fortune Financial Services (India) reports 39.6% EBITDA decline in 2016 and 10.9% Revenue decline
25-05-2016 • About Fortune Financial Services (India) (
$FORTUNEF) • By InTwits
Fortune Financial Services (India) reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 21.2% in FY2016, 31.2% in FY2015, 31.3% in FY2014, -7.6% in FY2013, 20.9% in FY2012
- Fortune Financial Services (India) has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.0%. At the same time it's a lot of higher than industry average of 1.2%.
- CAPEX is quite volatile: ₹13m in FY2016, ₹116m in FY2015, ₹25m in FY2014, ₹8m in FY2013, ₹8m in FY2012
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 10.9%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.8 pp from 6.6% to 9.5% in FY2016.
Net Income margin increased on 3.1 pp from 0.93% to 4.0% in FY2016. During FY2012-FY2016 Net Income margin bottomed in FY2013 at -21.3% and was growing since that time.
Investments (CAPEX, working capital and M&A)
In FY2016 Fortune Financial Services (India) had CAPEX/Revenue of 0.92%. CAPEX/Revenue showed almost no change from FY2013 to FY2016. For the last three years the average CAPEX/Revenue was 4.3%. During FY2012-FY2016 CAPEX as a % of Revenue topped in FY2015 at 7.3%.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.5x and Debt / EBITDA is 2.4x. Debt dropped on 84.6% while cash surged on 311%.
Fortune Financial Services (India) has no short term refinancing risk: cash is higher than short term debt (121.3%).
Valuation and dividends
Fortune Financial Services (India)'s trades at EV/EBITDA 26.0x and P/E 140.1x while industy averages are 17.8x and 21.9x. The company's EV/(EBITDA-CAPEX) is 27.2x with the industry average at 22.8x.
Financial and operational results
Fortune Financial Services (India) ($FORTUNEF) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 789 | 593 | 551 | 1,589 | 1,415 | -10.9% |
| EBITDA | 164 | -45 | 172 | 496 | 299 | -39.6% |
| Net Income | -22 | -126 | -12 | 15 | 57 | 282.0% |
Balance Sheet
|
|---|
| Cash | 65 | 86 | 59 | 208 | 856 | 310.9% |
| Short Term Debt | 1,547 | 1,272 | 1,918 | 4,384 | 706 | -83.9% |
| Long Term Debt | 0 | 0 | 0 | 217 | 1 | -99.5% |
Cash flow
|
|---|
| Capex | 8 | 8 | 25 | 116 | 13 | -88.8% |
Ratios
|
|---|
| Revenue growth | -11.7% | -24.9% | -7.1% | 188.4% | -10.9% | |
| EBITDA growth | -43.3% | -127.4% | -482.5% | 187.9% | -39.6% | |
|
|---|
| EBITDA Margin | 20.9% | -7.6% | 31.3% | 31.2% | 21.2% | -10.1% |
| Net Income Margin | -2.8% | -21.3% | -2.3% | 0.9% | 4.0% | 3.1% |
| CAPEX, % of revenue | 1.0% | 1.3% | 4.5% | 7.3% | 0.9% | -6.4% |
|
|---|
| ROE | -1.9% | -11.5% | -0.9% | 0.8% | 2.5% | 1.7% |
| Net Debt/EBITDA | 9.0x | | 10.8x | 8.9x | -0.5x | -9.4x |
Peers in Finance (including NBFCs)
Below we provide Fortune Financial Services (India) benchmarking against other companies in Finance (including NBFCs) 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 |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | - | 0.4% | -0.9% | 64.7% | 39.8% |
| Sks Microfinance ($SKSMICRO) | - | -25.6% | 55.0% | 47.3% | 64.5% |
| Bajaj Holdings & Investment ($BAJAJHLDNG) | - | 12.8% | 25.9% | 27.0% | -12.2% |
| Bajaj Finserv ($BAJAJFINSV) | - | 28.1% | 18.8% | 26.8% | 23.9% |
| Master Trust ($MASTERTR) | 10.2% | -0.0% | -5.3% | 26.0% | - |
| |
|---|
| Median (23 companies) | 23.9% | 27.4% | 20.8% | 13.3% | 9.9% |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | - | -24.9% | -7.1% | 188.4% | -10.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Microse India ($MICROSE) | - | - | - | 101.1% | - |
| Pnb Gilts ($PNBGILTS) | 94.0% | 96.4% | 96.4% | 96.1% | 95.4% |
| Jsw Holdings ($JSWHL) | - | - | - | 93.8% | - |
| Rural Electrification Corporation ($RECLTD) | 97.2% | 97.3% | 96.7% | 93.3% | - |
| Bajaj Holdings & Investment ($BAJAJHLDNG) | 96.1% | 95.4% | 92.3% | 92.7% | 91.4% |
| |
|---|
| Median (48 companies) | 70.0% | 67.8% | 66.4% | 56.6% | 66.8% |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | 20.9% | -7.6% | 31.3% | 31.2% | 21.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Clarus Finance & Securities ($CLARUS) | - | - | 6.9% | 5.8% | - |
| Srei Infrastructure Finance ($SREINFRA) | 30.2% | 8.5% | 12.3% | 5.4% | - |
| Motilal Oswal Financial Services ($MOTILALOFS) | 15.5% | 5.3% | 1.7% | 3.4% | 2.5% |
| Bengal & Assam Company ($BENGALASM) | 15.9% | 4.5% | 1.2% | 2.1% | - |
| Shriram City Union Finance ($SHRIRAMCIT) | 1.8% | 2.0% | 1.0% | 1.2% | 1.0% |
| |
|---|
| Median (21 companies) | 0.6% | 0.7% | 0.9% | 0.7% | 0.6% |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | 1.0% | 1.3% | 4.5% | 7.3% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Motilal Oswal Financial Services ($MOTILALOFS) | - | 12.0% | 9.7% | 11.9% | 7.8% |
| Sks Microfinance ($SKSMICRO) | - | - | 4.1% | 6.6% | 7.6% |
| Shriram City Union Finance ($SHRIRAMCIT) | 6.1% | 5.8% | 5.8% | 5.7% | 4.6% |
| Rural Electrification Corporation ($RECLTD) | - | 4.7% | 5.2% | 4.7% | - |
| Mahindra & Mahindra Financial Services ($M&MFIN) | 6.4% | 6.3% | 5.3% | 4.2% | 3.2% |
| |
|---|
| Median (52 companies) | 4.1% | 4.6% | 4.1% | 4.1% | 3.7% |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | - | - | - | - | - |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pnb Gilts ($PNBGILTS) | 14.2x | 11.2x | 11.3x | 8.8x | 15.0x |
| Srei Infrastructure Finance ($SREINFRA) | 7.0x | 6.2x | 7.5x | 8.0x | - |
| Rural Electrification Corporation ($RECLTD) | 8.3x | 8.0x | 7.5x | 8.0x | - |
| Magma Fincorp ($MAGMA) | 7.7x | 8.5x | 7.0x | 7.7x | 7.5x |
| Cholamandalam Investment And Finance Company ($CHOLAFIN) | 9.0x | 7.9x | 7.4x | 7.2x | 4.9x |
| |
|---|
| Median (44 companies) | 4.4x | 3.6x | 2.9x | 0.0x | 5.1x |
|---|
| Fortune Financial Services (India) ($FORTUNEF) | 9.0x | - | 10.8x | 8.9x | -0.5x |
