Punjab Alkalies & Chemicals revenue decreased on 9.5% and EBITDA Margin increased slightly on 0.60 pp from -1.7% to -1.1%

26-05-2016 • About Punjab Alkalies & Chemicals ($PACL) • By InTwits

Punjab Alkalies & Chemicals 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: -1.1%
EBITDA Margin is quite volatile: -1.1% in FY2016, -1.7% in FY2015, 0.5% in FY2014, 8.3% in FY2013, 11.8% in FY2012
It operates with high leverage: Net Debt/EBITDA is 5.3x while industry average is 2.0x

Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.

Revenue and profitability

Punjab Alkalies & Chemicals's Revenue decreased on 9.5%. Revenue decline was accelerating on average at -11.3 pp per annum in FY2012-FY2016. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.60 pp from -1.7% to -1.1% in FY2016. EBITDA Margin declined at -3.6 pp per annum in FY2012-FY2016.

Net Income margin decreased slightly on 1.1 pp from -4.9% to -5.9% in FY2016. Net Income margin stuck to a declining trend at -2.1 pp per annum in the last 5 years.

Financial and operational results

Punjab Alkalies & Chemicals ($PACL) key annual financial indicators

mln. INR	2012	2013	2014	2015	2016	2016/2015
P&L
Revenue	2,362	2,856	2,674	2,665	2,411	-9.5%
EBITDA	279	237	12	-46	-27
Net Income	44	28	-96	-129	-142
Balance Sheet
Cash	43	68
Short Term Debt	22	12
Long Term Debt	755	485
Cash flow
Capex	21
Ratios
Revenue growth	36.2%	20.9%	-6.4%	-0.3%	-9.5%
EBITDA growth	-565.0%	-15.2%	-94.9%	-482.7%	-40.8%

EBITDA Margin	11.8%	8.3%	0.5%	-1.7%	-1.1%	0.6%
Net Income Margin	1.9%	1.0%	-3.6%	-4.9%	-5.9%	-1.1%
CAPEX, % of revenue	0.9%

ROIC	9.6%	6.7%
ROE	4.2%	2.7%
Net Debt/EBITDA	2.6x	1.8x	0.0x

Peers in Commodity Chemicals

Below you can find Punjab Alkalies & Chemicals benchmarking vs. other companies in Commodity Chemicals 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
Tuticorin Alkali Chemicals & Fertilisers ($TUTIALKA)	-	-27.9%	-83.3%	408.0%	18.3%
Jayshree Chemicals ($JAYCH)	288.9%	17.5%	-75.2%	262.3%	-
Jagran Production ($JAGPRO)	589.4%	4.4%	514.9%	192.3%	-
Shree Hari Chemicals Export ($SHHARICH)	-2.5%	-78.0%	299.5%	111.6%	-
Jindal Poly Films ($JINDPOLBBPH)	-17.2%	-6.3%	131.7%	46.9%	-
Median (37 companies)	19.0%	9.7%	11.5%	6.3%	1.5%
Punjab Alkalies & Chemicals ($PACL)	-	20.9%	-6.4%	-0.3%	-9.5%

Top companies by EBITDA margin, %


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Riddhi Siddhi Gluco Biols ($RIDDHI)	-	-	-	104.7%	-
Mysore Petro Chemicals ($MYSORPETRO)	-	-	-	47.1%	-
Aditya Birla Chemicals (India) ($ABCIL)	26.8%	27.1%	23.6%	21.9%	-
Indo Borax & Chemicals ($INDOBORAX)	-	-	-	21.3%	-
Chemfab Alkalis ($CHEMFALKAL)	22.3%	32.9%	24.2%	19.8%	23.2%
Median (50 companies)	9.6%	8.4%	8.6%	6.6%	11.2%
Punjab Alkalies & Chemicals ($PACL)	11.8%	8.3%	0.5%	-1.7%	-1.1%

Top companies by CAPEX/Revenue, %


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Kanoria Chemicals & Industries ($KANORICHEM)	25.1%	6.0%	13.4%	40.3%	-
Aditya Birla Chemicals (India) ($ABCIL)	136.9%	24.2%	30.8%	15.0%	-
Aarti Industries ($AARTIIND)	8.0%	11.2%	11.0%	10.4%	16.8%
Alkyl Amines Chemicals ($ALKYLAMINE)	5.1%	6.6%	5.9%	8.6%	7.3%
Sukhjit Starch & Chemicals ($SUKHJITS)	15.7%	9.4%	5.4%	5.4%	3.6%
Median (22 companies)	5.3%	6.6%	5.7%	3.2%	4.6%

Top companies by ROIC, %


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Bodal Chemicals ($BODALCHEM)	-1.3%	3.3%	39.0%	38.3%	33.1%
Elantas Beck India ($ELANTAS)	20.4%	33.9%	31.0%	36.6%	-
Alkyl Amines Chemicals ($ALKYLAMINE)	16.0%	18.7%	25.0%	23.7%	24.7%
Aarti Industries ($AARTIIND)	15.9%	19.1%	17.2%	17.9%	19.3%
Transpek Industry ($TRANSPEK)	-1.7%	14.2%	11.0%	17.8%	26.9%
Median (60 companies)	9.0%	9.8%	9.3%	8.8%	17.9%
Punjab Alkalies & Chemicals ($PACL)	9.6%	6.7%	-	-	-

Top companies by Net Debt / EBITDA


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Iol Chemicals & Pharmaceuticals ($IOLCP)	5.8x	4.5x	3.7x	35.4x	8.8x
India Glycols ($INDIAGLYCO)	4.8x	3.7x	8.5x	14.2x	6.7x
Godrej Industries ($GODREJIND)	9.9x	5.7x	7.9x	10.7x	10.0x
Kanoria Chemicals & Industries ($KANORICHEM)	5.2x	9.6x	3.5x	9.4x	-
Garware Polyester ($GARWARPOLY)	2.2x	3.8x	4.0x	5.2x	3.1x
Median (38 companies)	2.6x	3.2x	1.4x	1.0x	1.1x

Punjab Alkalies & Chemicals stock price chart

Punjab Alkalies & Chemicals financials

mln.	FY2010	FY2011	FY2012

Revenue	3,191	1,734	2,362
EBITDA	-60.176	-59.985	278.9
Net income	-224.143	-242.803	43.873
CAPEX	0.000	2.871	20.618
Debt	816.0	886.8	777.2
Cash	23.776	15.659	42.690

About Punjab Alkalies & Chemicals

Punjab Alkalies & Chemicals Limited manufactures and sells chemicals in India. The company offers caustic soda lye and flakes for use in paper and paper pulp, soap and detergent, linear alkyl benzene, viscose and rayon, and water demineralization applications, as well as in textile and dye stuff, and aluminum industries; and liquid chlorine that is used in water treatment plants, paper manufacturing, stable bleaching powder, CPW and PVC, chloromethane, and other chlor-organic chemical applications. In addition, the company provides hydrochloric acid for water demineralization in power and fertilizer plants, metal pickling, preparation of various metal chloride, etc.; and sodium hypochlorite, which is used in textile bleaching, laundry trade, dis-infection of drinking water, etc. Further, it offers hydrogen gas that is used as fuel, and coolant in power plants, as well as in hydrogenation of vegetable oils and optical fiber units. The company was formerly known as Punjab Alkalies Limited and changed its name to Punjab Alkalies & Chemicals Limited in April 1983. Punjab Alkalies & Chemicals Limited was incorporated in 1975 and is headquartered in Chandigarh, India.