Karur Vysya Bank reports 22.3% Net Income growth in 2016
27-05-2016 • About Karur Vysya Bank (
$KARURVYSYA) • By InTwits
Karur Vysya Bank reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Karur Vysya Bank has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.1%. At the same time it's a lot of higher than industry average of 1.7%.
- CAPEX is quite volatile: ₹5,038m in FY2016, ₹2,238m in FY2015, ₹1,935m in FY2014, ₹5,851m in FY2013, ₹10,097m in FY2012
- The company has highly profitable business model: ROIC is 12.4%
- It operates with medium-size leverage: Net Debt/EBITDA is 2.2x while industry average is
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Karur Vysya Bank's Revenue increased slightly on 1.3%. Revenue decline was accelerating on average at -10.8 pp per annum in the last 5 years.
Net Income margin increased slightly on 1.6 pp from 7.6% to 9.2% in FY2016. During the last 5 years Net Income margin bottomed in FY2015 at 7.6%.
Investments (CAPEX, working capital and M&A)
In FY2016 Karur Vysya Bank had CAPEX/Revenue of 1.5%. CAPEX/Revenue decreased slightly on 1.4 pp from 2.9% in FY2013 to 1.5% in FY2016. It's average level of CAPEX/Revenue for the last three years was 1.9%. During FY2012-FY2016 CAPEX as a % of Revenue topped in FY2013 at 2.9% and was declining since that time.
Return on investment
The company operates at good ROIC (12.4%) and ROE (12.9%). ROIC increased on 6.7 pp from 5.7% to 12.4% in FY2016. ROE increased slightly on 0.61 pp from 12.3% to 12.9% in FY2016. During FY2012-FY2016 ROIC bottomed in FY2014 at 5.3% and was growing since that time. ROE followed a declining trend at -2.2 pp per annum in FY2012-FY2016.
Leverage (Debt)
Debt dropped on 56.0% while cash decreased on 6.1%.
Karur Vysya Bank has no short term refinancing risk: cash is higher than short term debt (-4,158.9%).
Management team
Krishnamoorthy Venkataraman is a Karur Vysya Bank's CEO. Krishnamoorthy Venkataraman has spent 9 years with the company.
Financial and operational results
Karur Vysya Bank ($KARURVYSYA) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 36,203 | 46,943 | 54,672 | 60,713 | 61,508 | 1.3% |
| Net Income | 5,017 | 5,503 | 4,296 | 4,643 | 5,676 | 22.3% |
Balance Sheet
|
|---|
| Cash | 19,209 | 16,286 | 25,462 | 26,929 | 25,291 | -6.1% |
| Short Term Debt | 2,242 | 2,319 | 14,336 | 5,042 | -608 | -112.1% |
| Long Term Debt | 24,724 | 40,623 | 1,499 | 6,033 | 5,481 | -9.2% |
Cash flow
|
|---|
| Capex | 731 | 1,342 | 1,380 | 1,028 | 918 | -10.7% |
Ratios
|
|---|
| Revenue growth | 45.9% | 29.7% | 16.5% | 11.0% | 1.3% | |
|
|---|
| Net Income Margin | 13.9% | 11.7% | 7.9% | 7.6% | 9.2% | 1.6% |
| CAPEX, % of revenue | 2.0% | 2.9% | 2.5% | 1.7% | 1.5% | -0.2% |
|
|---|
| ROIC | 14.5% | 11.0% | 5.3% | 5.7% | 12.4% | 6.7% |
| ROE | 20.7% | 19.0% | 13.4% | 12.3% | 12.9% | 0.6% |
Peers in Banks
Below we provide Karur Vysya Bank benchmarking against other companies in Banks 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 |
|---|
| Kotak Mahindra Bank ($KOTAKBANK) | - | 22.9% | 7.1% | 26.1% | 29.2% |
| Dcb Bank ($DCBBANK) | - | 26.2% | 22.5% | 25.3% | 20.8% |
| Yes Bank ($YESBANK) | - | 33.7% | 21.6% | 17.7% | 18.9% |
| Axis Bank ($AXISBANK) | - | 24.5% | 13.1% | 15.6% | 14.9% |
| Lakshmi Vilas Bank ($LAKSHVILAS) | - | 16.7% | 11.7% | 14.2% | 14.6% |
| |
|---|
| Median (27 companies) | 45.9% | 15.7% | 10.6% | 10.2% | 2.7% |
|---|
| Karur Vysya Bank ($KARURVYSYA) | - | 29.7% | 16.5% | 11.0% | 1.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Indian Overseas Bank ($IOB) | 1.1% | 1.0% | 0.9% | 0.6% | 4.8% |
| Union Bank Of India ($UNIONBANK) | 1.2% | 1.3% | 1.2% | 1.0% | 4.4% |
| Indian Bank ($INDIANB) | 1.2% | 1.3% | 1.0% | 1.4% | 4.3% |
| Axis Bank ($AXISBANK) | 1.4% | 1.4% | 1.6% | 1.2% | 2.9% |
| Lakshmi Vilas Bank ($LAKSHVILAS) | 2.1% | 1.4% | 1.6% | 2.4% | 2.4% |
| |
|---|
| Median (27 companies) | 1.2% | 1.2% | 1.2% | 1.3% | 1.3% |
|---|
| Karur Vysya Bank ($KARURVYSYA) | 2.0% | 2.9% | 2.5% | 1.7% | 1.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Karnataka Bank ($KTKBANK) | 6.8% | 10.2% | 7.7% | 10.4% | 10.1% |
| Yes Bank ($YESBANK) | 9.8% | 8.4% | 8.4% | 8.7% | 9.0% |
| Axis Bank ($AXISBANK) | 9.6% | 8.9% | 9.1% | 8.8% | 7.6% |
| Kotak Mahindra Bank ($KOTAKBANK) | 6.8% | 6.5% | 7.1% | 8.5% | 7.3% |
| Lakshmi Vilas Bank ($LAKSHVILAS) | 6.5% | 7.5% | 0.7% | 6.1% | 5.8% |
| |
|---|
| Median (27 companies) | 7.2% | 6.1% | 3.2% | 4.2% | 3.8% |
|---|
| Karur Vysya Bank ($KARURVYSYA) | 14.5% | 11.0% | 5.3% | 5.7% | 12.4% |
