Puravankara Projects reports 49.7% Net Income decline in 2016 and 7.3% Revenue decline
27-05-2016 • About Puravankara Projects (
$PURVA) • By InTwits
Puravankara Projects reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Puravankara Projects has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.6%. At the same time it's in pair with industry average of 2.8%
- CAPEX is quite volatile: ₹155m in FY2016, ₹350m in FY2015, ₹141m in FY2014, ₹216m in FY2013, ₹149m in FY2012
- The company has business model with low profitability: ROIC is 8.1%
- It operates with high leverage: Net Debt/EBITDA is 5.5x while industry average is 6.9x
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 decreased on 7.3%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.1 pp from 8.2% to 9.3% in FY2016. EBITDA Margin stuck to a declining trend at -7.2 pp per annum in FY2012-FY2016.
Net Income margin decreased on 3.7 pp from 8.0% to 4.3% in FY2016. Net Income margin declined at -3.7 pp per annum in FY2012-FY2016.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 1.0% in FY2016. Puravankara Projects showed small CAPEX/Revenue decline of 0.75 pp from 1.8% in FY2013 to 1.0% in FY2016. Average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at low ROIC (8.1%) and ROE (2.9%). ROIC decreased slightly on 1.6 pp from 9.7% to 8.1% in FY2016. ROE decreased on 3.1 pp from 6.0% to 2.9% in FY2016. During the last 5 years ROIC topped in FY2013 at 17.0% and was declining since that time. During FY2012-FY2016 ROE topped in FY2013 at 13.6% and was declining since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 5.5x and Debt / EBITDA is 6.3x. Net Debt / EBITDA jumped on 1.5x from 4.0x to 5.5x in FY2016. Debt jumped on 28.7% while cash surged on 32.3%. During FY2012-FY2016 Net Debt/EBITDA bottomed in FY2013 at 2.7x and was growing since that time.
Puravankara Projects has short term refinancing risk: cash is only 31.3% of short term debt.
Valuation and dividends
The company's trades at EV/EBITDA 8.7x and P/E 17.6x while industy averages are 17.8x and 21.9x. The company's EV/(EBITDA-CAPEX) is 9.1x with the industry average at 22.8x.
Management team
Ashish Ravi Puravankara is a Puravankara Projects's CEO. Ashish Ravi Puravankara has spent 5 years with the company.
Financial and operational results
Puravankara Projects ($PURVA) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8,097 | 12,320 | 12,981 | 16,586 | 15,377 | -7.3% |
| EBITDA | 3,904 | 5,796 | 4,740 | 3,989 | 3,676 | -7.8% |
| Net Income | 1,357 | 2,434 | 1,600 | 1,327 | 668 | -49.7% |
Balance Sheet
|
|---|
| Cash | 698 | 2,275 | 1,655 | 2,171 | 2,872 | 32.3% |
| Short Term Debt | 10,451 | 8,881 | 9,938 | 7,279 | 9,179 | 26.1% |
| Long Term Debt | 3,039 | 8,978 | 7,030 | 10,652 | 13,894 | 30.4% |
Cash flow
|
|---|
| Capex | 149 | 216 | 141 | 350 | 155 | -55.8% |
Ratios
|
|---|
| Revenue growth | 36.4% | 52.2% | 5.4% | 27.8% | -7.3% | |
| EBITDA growth | 34.6% | 48.5% | -18.2% | -15.8% | -7.8% | |
|
|---|
| EBITDA Margin | 48.2% | 47.1% | 36.5% | 24.1% | 23.9% | -0.1% |
| Net Income Margin | 16.8% | 19.8% | 12.3% | 8.0% | 4.3% | -3.7% |
| CAPEX, % of revenue | 1.8% | 1.8% | 1.1% | 2.1% | 1.0% | -1.1% |
|
|---|
| ROIC | 13.3% | 17.0% | 12.3% | 9.7% | 8.1% | -1.6% |
| ROE | 8.3% | 13.6% | 7.9% | 6.0% | 2.9% | -3.1% |
| Net Debt/EBITDA | 3.3x | 2.7x | 3.2x | 4.0x | 5.5x | 1.5x |
Peers in Realty
Below you can find Puravankara Projects benchmarking vs. other companies in Realty 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 |
|---|
| Sspdl ($SSPDL) | 16.2% | -11.8% | -43.4% | 326.1% | - |
| Orbit Corporation ($ORBITCORP) | - | -21.9% | -88.0% | 275.1% | -98.6% |
| Ajmera Realty & Infra India ($AJMERA) | - | -61.7% | -1.8% | 109.9% | 92.0% |
| Prajay Engineers Syndicate ($PRAENG) | -21.1% | 42.0% | -30.1% | 62.8% | - |
| Godrej Properties ($GODREJPROP) | - | 34.7% | 13.7% | 56.3% | 35.9% |
| |
|---|
| Median (34 companies) | -16.0% | 3.4% | -4.5% | 11.4% | 15.5% |
|---|
| Puravankara Projects ($PURVA) | - | 52.2% | 5.4% | 27.8% | -7.3% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Godrej Properties ($GODREJPROP) | 24.9% | 33.3% | 28.9% | 19.4% | 14.7% |
| |
|---|
| Median (1 company) | 24.9% | 33.3% | 28.9% | 19.4% | 14.7% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hubtown ($HUBTOWN) | 53.3% | 72.4% | 67.6% | 82.4% | - |
| Housing Development & Infrastructure ($HDIL) | 75.8% | 40.6% | 102.5% | 78.9% | - |
| Tci Developers ($TCIDEVELOP) | - | - | - | 75.9% | - |
| Orbit Corporation ($ORBITCORP) | 42.4% | 53.3% | -127.2% | 69.8% | - |
| Oberoi Realty ($OBEROIRLTY) | 59.3% | 58.9% | 54.5% | 56.4% | 47.7% |
| |
|---|
| Median (43 companies) | 19.4% | 13.4% | 19.8% | 19.4% | 21.4% |
|---|
| Puravankara Projects ($PURVA) | 48.2% | 47.1% | 36.5% | 24.1% | 23.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Prozone Intu Properties ($PROZONINTU) | - | - | - | 89.5% | - |
| Ashiana Housing ($ASHIANA) | - | - | - | 26.7% | - |
| Brigade Enterprises ($BRIGADE) | 45.7% | 10.7% | 17.0% | 18.5% | 56.3% |
| Prestige Estates Projects ($PRESTIGE) | 37.7% | 30.2% | 18.8% | 11.6% | - |
| Parsvnath Developers ($PARSVNATH) | 15.9% | - | 11.6% | 10.6% | 15.6% |
| |
|---|
| Median (30 companies) | 4.9% | 2.6% | 3.7% | 2.5% | 2.1% |
|---|
| Puravankara Projects ($PURVA) | 1.8% | 1.8% | 1.1% | 2.1% | 1.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ahluwalia Contracts (India) ($AHLUCONT) | -3.2% | -15.8% | 5.6% | 21.2% | 27.1% |
| Poddar Developers ($PODDARDEV) | 3.9% | 2.6% | 12.9% | 19.1% | 7.5% |
| Lancor Holdings ($LANCORHOL) | 18.0% | 11.6% | 19.5% | 17.7% | - |
| Mahindra Lifespace Developers ($MAHLIFE) | 10.4% | 11.7% | 6.6% | 14.9% | 4.6% |
| Sobha Developers ($SOBHA) | 18.8% | 16.7% | 14.6% | 12.7% | 9.0% |
| |
|---|
| Median (50 companies) | 5.7% | 4.6% | 5.6% | 6.8% | 7.5% |
|---|
| Puravankara Projects ($PURVA) | 13.3% | 17.0% | 12.3% | 9.7% | 8.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| D B Realty ($DBREALTY) | 13.2x | 135.4x | 14.0x | 54.8x | - |
| B.L.Kashyap And Sons ($BLKASHYAP) | 8.2x | 5.8x | 12.7x | 40.1x | 3.3x |
| Vipul ($VIPUL) | 0.7x | 3.0x | 10.8x | 26.0x | - |
| Ansal Properties & Infrastructure ($ANSALAPI) | 12.8x | 11.9x | 11.4x | 16.6x | - |
| Srs Real Infrastructure ($SRSREAL) | 11.7x | 10.0x | 12.9x | 14.7x | - |
| |
|---|
| Median (37 companies) | 5.3x | 5.1x | 5.0x | 4.0x | 4.2x |
|---|
| Puravankara Projects ($PURVA) | 3.3x | 2.7x | 3.2x | 4.0x | 5.5x |
