Saksoft EBITDA jumped on 55.9% and EBITDA Margin increased on 4.8 pp from 10.0% to 14.8%
27-05-2016 • About Saksoft (
$SAKSOFT) • By InTwits
Saksoft reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Saksoft is a growth stock: FY2016 revenue growth was 5.3%, 5 year revenue CAGR was 18.2% at FY2016 ROIC 22.3%
- The company has highly profitable business model: ROIC is 22.3%
- It operates with medium-size leverage: Net Debt/EBITDA is 0.3x while industry average is -0.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Saksoft's Revenue increased on 5.3%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.8 pp from 4.4% to 7.1% in FY2016.
Net Income margin increased slightly on 1.9 pp from 5.7% to 7.6% in FY2016.
Return on investment
The company operates at high and attractive ROIC (22.3%) while ROE is a bit lower (15.4%).
Leverage (Debt)
Debt level is 0.3x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.8x from 1.2x to 0.3x in FY2016. Debt dropped on 23.4% while cash jumped on 32.2%.
Saksoft has no short term refinancing risk: cash is higher than short term debt (6,311.2%).
Valuation and dividends
Saksoft's trades at EV/EBITDA 6.8x and P/E 12.6x while industy averages are 17.8x and 21.9x.
Financial and operational results
Saksoft ($SAKSOFT) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,228 | 1,590 | 2,244 | 2,314 | 2,437 | 5.3% |
| EBITDA | 133 | 173 | 235 | 232 | 362 | 55.9% |
| Net Income | 70 | 109 | 149 | 132 | 185 | 39.9% |
Balance Sheet
|
|---|
| Cash | 105 | 92 | | 152 | 201 | 32.2% |
| Short Term Debt | 1 | 64 | | 127 | 3 | -97.5% |
| Long Term Debt | 470 | 428 | | 296 | 321 | 8.3% |
Cash flow
|
|---|
| Capex | 8 | | | 5 | | |
Ratios
|
|---|
| Revenue growth | 16.3% | 29.5% | 41.1% | 3.1% | 5.3% | |
| EBITDA growth | 24.8% | 30.1% | 36.0% | -1.1% | 55.9% | |
|
|---|
| EBITDA Margin | 10.8% | 10.9% | 10.5% | 10.0% | 14.8% | 4.8% |
| Net Income Margin | 5.7% | 6.9% | 6.7% | 5.7% | 7.6% | 1.9% |
| CAPEX, % of revenue | 0.6% | | | 0.2% | | |
|
|---|
| ROIC | 11.0% | 13.5% | | | 22.3% | |
| ROE | 12.1% | 15.5% | | | 15.4% | |
| Net Debt/EBITDA | 2.8x | 2.3x | 0.0x | 1.2x | 0.3x | -0.8x |
Peers in IT Software Products
Below we provide Saksoft benchmarking against other companies in IT Software 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 |
|---|
| Twinstar Industries ($TWINSTAR) | 204.5% | 59.8% | 38.8% | 40.3% | - |
| Atishay Infotech ($ATISHAY) | - | 6.9% | 21.8% | 28.2% | -2.2% |
| Dion Global Solutions ($DION) | - | 40.8% | -9.5% | 27.8% | -14.4% |
| Avance Technologies ($AVANCE) | - | -17.9% | -30.8% | 20.3% | -4.6% |
| Softsol India ($SOFTSOL) | -10.4% | 9.3% | -20.4% | 14.1% | - |
| |
|---|
| Median (16 companies) | 13.1% | 15.4% | 14.2% | 9.7% | -2.3% |
|---|
| Saksoft ($SAKSOFT) | - | 29.5% | 41.1% | 3.1% | 5.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Atishay Infotech ($ATISHAY) | 35.7% | 28.1% | 25.8% | 24.5% | 21.9% |
| Subex ($SUBEX) | 27.3% | 17.0% | 24.9% | 23.6% | 20.8% |
| Tata Elxsi ($TATAELXSI) | 13.8% | 11.9% | 17.6% | 20.9% | 23.0% |
| Cambridge Technology Enterprises ($CTE) | - | - | - | 20.9% | - |
| Virinchi Technologies ($VIRNICHIQ) | - | - | - | 17.4% | - |
| |
|---|
| Median (23 companies) | 7.5% | 8.5% | 9.9% | 9.2% | 10.0% |
|---|
| Saksoft ($SAKSOFT) | 10.8% | 10.9% | 10.5% | 10.0% | 14.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Aurionpro Solutions ($AURIONPRO) | 17.5% | 12.3% | 12.6% | 13.4% | - |
| Mastek ($MASTKBBPH) | 2.2% | - | 0.0% | 4.9% | 2.4% |
| Dion Global Solutions ($DION) | 39.9% | 11.9% | 29.6% | 4.0% | 18.4% |
| Tata Elxsi ($TATAELXSI) | 5.3% | 5.4% | 3.1% | 3.9% | 3.6% |
| Polaris Financial Technology ($POLARIS) | 7.2% | 2.5% | 1.5% | 3.9% | 1.6% |
| |
|---|
| Median (9 companies) | 4.5% | 5.4% | 2.3% | 3.9% | 2.4% |
|---|
| Saksoft ($SAKSOFT) | 0.6% | - | - | 0.2% | - |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tata Elxsi ($TATAELXSI) | 22.5% | 19.1% | 38.3% | 55.4% | 65.9% |
| Mindteck (India) ($MINDTECK) | -2.6% | 1.2% | 20.0% | 17.5% | 10.6% |
| Blue Star Infotech ($BLUESTINFO) | - | 7.1% | 16.3% | 17.4% | - |
| Polaris Financial Technology ($POLARIS) | 19.5% | 15.1% | 12.6% | 16.2% | 24.8% |
| Aurionpro Solutions ($AURIONPRO) | 8.6% | 8.6% | 5.9% | 12.1% | - |
| |
|---|
| Median (31 companies) | 3.8% | 4.7% | 16.3% | 12.1% | 9.2% |
|---|
| Saksoft ($SAKSOFT) | 11.0% | 13.5% | - | - | 22.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Subex ($SUBEX) | 4.6x | 13.1x | 8.5x | 8.0x | 0.9x |
| Dion Global Solutions ($DION) | 11.8x | 11.3x | - | 7.4x | - |
| Aurionpro Solutions ($AURIONPRO) | 1.7x | 1.7x | 1.9x | 1.2x | - |
| Datamatics Global Services ($DATAMATICS) | 0.5x | 0.3x | 0.5x | 0.3x | 0.4x |
| Virinchi Technologies ($VIRNICHIQ) | 0.8x | 1.1x | - | 0.0x | - |
| |
|---|
| Median (19 companies) | 0.5x | 0.0x | 0.0x | 0.0x | -0.7x |
|---|
| Saksoft ($SAKSOFT) | 2.8x | 2.3x | 0.0x | 1.2x | 0.3x |
