Ismt EBITDA dropped on 86.3% and Revenue dropped on 33.1%

27-05-2016 • About Ismt ($ISMTLTD) • By InTwits

Ismt reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:

• Ismt is a company in decline: FY2016 revenue growth was -33.1%, 5 years revenue CAGR was -10.2%
• EBITDA Margin is declining: 0.4% in FY2016 vs. 1.9% in FY2015 vs. 11.5% in FY2012
• EBITDA Margin is quite volatile: 0.4% in FY2016, 1.9% in FY2015, 4.7% in FY2014, 9.0% in FY2013, 11.5% 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 33.1%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 1.5 pp from 1.9% to 0.39% in FY2016. EBITDA Margin stuck to a declining trend at -2.9 pp per annum in FY2012-FY2016.

Net Income margin dropped on 27.1 pp from -12.7% to -39.8% in FY2016. Net Income margin followed a declining trend at -8.7 pp per annum in the last 5 years.

Financial and operational results

Ismt ($ISMTLTD) key annual financial indicators

mln. INR	2012	2013	2014	2015	2016	2016/2015
P&L
Revenue	19,682	15,382	15,957	14,815	9,915	-33.1%
EBITDA	2,256	1,389	754	284	39	-86.3%
Net Income	252	-1,241	-1,942	-1,881	-3,948
Balance Sheet
Cash	438	92	1,068	1,210
Short Term Debt	3,669	6,362	8,499	4,831
Long Term Debt	8,818	7,392	7,597	10,089
Cash flow
Capex	2,095	891	345
Ratios
Revenue growth	16.2%	-21.8%	3.7%	-7.2%	-33.1%
EBITDA growth	-9.0%	-38.5%	-45.7%	-62.4%	-86.3%
EBITDA Margin	11.5%	9.0%	4.7%	1.9%	0.4%	-1.5%
Net Income Margin	1.3%	-8.1%	-12.2%	-12.7%	-39.8%	-27.1%
CAPEX, % of revenue	10.6%	5.8%	2.2%
ROIC	7.4%	2.0%	-1.8%	-2.9%
ROE	4.4%	-25.1%	-59.9%	-81.6%
Net Debt/EBITDA	5.3x	9.8x	19.9x	48.3x	0.0x

Peers in Iron & Steel/Interm.Products

Below we provide Ismt benchmarking against other companies in Iron & Steel/Interm.Products 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
Ocl Iron And Steel ($OISL)	-	5.5%	86.6%	69.1%	-65.1%
Uttam Galva Steels ($UTTAMSTL)	12.0%	11.0%	-13.2%	55.0%	-
Modern Steels ($MDRNSTL)	-2.6%	-22.7%	0.7%	20.3%	-
Maithan Alloys ($MAITHANALL)	-	59.1%	1.1%	15.0%	4.0%
Pennar Industries ($PENIND)	-	-8.5%	0.5%	12.7%	3.4%
Median (34 companies)	11.9%	8.8%	3.4%	-0.4%	-13.1%
Ismt ($ISMTLTD)	-	-21.8%	3.7%	-7.2%	-33.1%

Top companies by EBITDA margin, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Jindal Steel & Power ($JINDALSTEL)	37.5%	30.5%	28.1%	29.8%	17.2%
Sarda Energy & Minerals ($SARDAEN)	16.3%	21.5%	21.3%	21.5%	13.5%
Bhushan Steel ($BHUSANSTL)	31.2%	32.3%	28.1%	20.4%	-
Jsw Steel ($JSWSTEEL)	17.8%	17.1%	17.9%	17.7%	14.6%
Tata Metaliks ($TATAMETALI)	-9.6%	0.9%	6.8%	14.6%	16.8%
Median (31 companies)	9.3%	9.2%	7.4%	7.3%	10.0%
Ismt ($ISMTLTD)	11.5%	9.0%	4.7%	1.9%	0.4%

Top companies by CAPEX/Revenue, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Ocl Iron And Steel ($OISL)	191.2%	247.2%	163.7%	42.4%	-
Jindal Steel & Power ($JINDALSTEL)	34.2%	47.6%	69.6%	26.4%	21.8%
Jayaswal Neco Industries ($JAYNECOIND)	20.4%	44.0%	31.1%	17.3%	5.7%
Steel Authority Of India ($SAIL)	20.9%	20.7%	19.3%	16.9%	17.3%
Bhushan Steel ($BHUSANSTL)	47.2%	44.0%	50.4%	16.2%	-
Median (19 companies)	9.7%	11.7%	9.2%	5.3%	7.9%

Top companies by ROIC, %

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Tata Metaliks ($TATAMETALI)	-23.5%	-3.7%	19.9%	57.4%	42.6%
Pennar Industries ($PENIND)	26.8%	18.4%	12.3%	15.7%	16.6%
Maithan Alloys ($MAITHANALL)	16.3%	15.1%	5.5%	15.3%	19.0%
Kirloskar Ferrous Industries ($KIRLFER)	19.1%	16.8%	12.4%	14.7%	15.9%
Gallantt Metal ($GALLANTT)	8.7%	11.7%	8.5%	11.7%	-
Median (42 companies)	6.8%	5.5%	6.0%	5.0%	3.4%
Ismt ($ISMTLTD)	7.4%	2.0%	-1.8%	-2.9%	-

Top companies by Net Debt / EBITDA

Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Visa Steel ($VISASTEEL)	20.1x	-	24.4x	187.1x	-
Kic Metaliks ($KAJARIR)	9.2x	3.0x	18.2x	19.8x	-
Ocl Iron And Steel ($OISL)	164.7x	1,935.8x	41.6x	19.4x	-
Bhushan Steel ($BHUSANSTL)	6.3x	8.6x	12.9x	17.7x	-
Prakash Industries ($PRAKASH)	2.5x	2.8x	2.5x	11.9x	3.4x
Median (28 companies)	4.6x	4.4x	3.4x	1.7x	0.9x
Ismt ($ISMTLTD)	5.3x	9.8x	19.9x	48.3x	0.0x

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