Binani Industries Net Debt / EBITDA dropped on 19.2x from 36.1x to 16.9x in 2016 and Revenue decreased on 6.6%

30-05-2016 • About Binani Industries ($BINANIIND) • By InTwits

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

EBITDA Margin is quite volatile: 9.1% in FY2016, 3.6% in FY2015, 7.0% in FY2014, 11.8% in FY2013, 10.1% in FY2012
Binani Industries has high CAPEX intensity: 5 year average CAPEX/Revenue was 19.6%. At the same time it's a lot of higher than industry average of 4.0%.
CAPEX is quite volatile: ₹1,605m in FY2016, ₹930m in FY2015, ₹2,645m in FY2014, ₹2,860m in FY2013, ₹24,507m in FY2012
The company has potentially unprofitable business model: ROIC is 2.6%
It operates with high leverage: Net Debt/EBITDA is 16.9x while industry average is 7.2x

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 6.6%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 5.5 pp from 3.6% to 9.1% in FY2016.

SG&A as a % of Revenue showed almost no change in FY2016.

Net Income margin increased on 3.6 pp from -14.8% to -11.2% in FY2016.

Investments (CAPEX, working capital and M&A)

In FY2016 Binani Industries had CAPEX/Revenue of 4.0%. Binani Industries showed decline in CAPEX/Revenue of 2.4 pp from 6.4% in FY2013 to 4.0% in FY2016. It's average CAPEX/Revenue for the last three years was 3.9%. During FY2012-FY2016 CAPEX as a % of Revenue bottomed in FY2015 at 2.1%.

Leverage (Debt)

Debt level is 16.9x Net Debt / EBITDA and 17.1x Debt / EBITDA. Net Debt / EBITDA dropped on 19.2x from 36.1x to 16.9x in FY2016. Debt increased on 7.8% while cash dropped on 53.2%.

Binani Industries has short term refinancing risk: cash is only 7.8% of short term debt.

Management team

Binani Industries's CFO is Visalakshi Sridhar. Visalakshi Sridhar has 5 years tenure at the company.

Financial and operational results

Binani Industries ($BINANIIND) key annual financial indicators

mln. INR	2012	2013	2014	2015	2016	2016/2015
P&L
Revenue	30,694	44,811	47,356	43,312	40,455	-6.6%
SG&A				315	301	-4.6%
EBITDA	3,111	5,310	3,324	1,573	3,697	135.0%
Net Income	-1,660	-2,085	-6,632	-6,401	-4,535
Balance Sheet
Cash	4,067	963	569	2,015	943	-53.2%
Short Term Debt	9,946	9,671	13,023	10,102	12,149	20.3%
Long Term Debt	34,451	33,943	38,194	48,667	51,186	5.2%
Cash flow
Capex	24,507	2,860	2,645	930	1,605	72.6%
Ratios
Revenue growth	26.5%	46.0%	5.7%	-8.5%	-6.6%
EBITDA growth	11.5%	70.7%	-37.4%	-52.7%	135.0%

EBITDA Margin	10.1%	11.8%	7.0%	3.6%	9.1%	5.5%
SG&A, % of revenue				0.7%	0.7%	0.0%
Net Income Margin	-5.4%	-4.7%	-14.0%	-14.8%	-11.2%	3.6%
CAPEX, % of revenue	79.8%	6.4%	5.6%	2.1%	4.0%	1.8%

ROIC	3.2%	4.9%	0.7%	-2.0%	2.6%	4.7%
ROE	-41.3%	-71.6%
Net Debt/EBITDA	13.0x	8.0x	15.2x	36.1x	16.9x	-19.2x

Peers in Holding Companies

Below you can find Binani Industries benchmarking vs. other companies in Holding Companies 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	FY2012	FY2013	FY2014	FY2015	FY2016
Network18 Media & Investments ($NETWORK18)	-	19.4%	14.0%	15.8%	8.6%
Kirloskar Brothers Investments ($KBIL)	8,068.8%	-2.8%	-4.6%	5.2%	-
Median (2 companies)	8,068.8%	8.3%	4.7%	10.5%	8.6%
Binani Industries ($BINANIIND)	-	46.0%	5.7%	-8.5%	-6.6%

Top companies by EBITDA margin, %


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Kirloskar Brothers Investments ($KBIL)	13.2%	14.6%	13.2%	9.6%	-
Network18 Media & Investments ($NETWORK18)	-13.9%	-1.7%	3.7%	5.0%	5.3%
Median (2 companies)	-0.3%	6.4%	8.5%	7.3%	5.3%
Binani Industries ($BINANIIND)	10.1%	11.8%	7.0%	3.6%	9.1%

Top companies by CAPEX/Revenue, %


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Network18 Media & Investments ($NETWORK18)	4.4%	3.0%	4.4%	4.3%	5.4%
Kirloskar Brothers Investments ($KBIL)	3.7%	4.8%	4.3%	2.7%	-
Median (2 companies)	4.0%	3.9%	4.3%	3.5%	5.4%
Binani Industries ($BINANIIND)	79.8%	6.4%	5.6%	2.1%	4.0%

Top companies by ROIC, %


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Kirloskar Brothers Investments ($KBIL)	34.9%	20.6%	15.8%	9.4%	-
Network18 Media & Investments ($NETWORK18)	-10.8%	-2.8%	0.3%	1.6%	2.0%
Median (2 companies)	12.0%	8.9%	8.0%	5.5%	2.0%
Binani Industries ($BINANIIND)	3.2%	4.9%	0.7%	-2.0%	2.6%

Top companies by Net Debt / EBITDA


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Network18 Media & Investments ($NETWORK18)	-	-	7.4x	4.2x	4.9x
Kirloskar Brothers Investments ($KBIL)	0.3x	-0.1x	-0.2x	-0.2x	-
Median (2 companies)	0.3x	-0.1x	3.6x	2.0x	4.9x
Binani Industries ($BINANIIND)	13.0x	8.0x	15.2x	36.1x	16.9x

Binani Industries stock price chart

Binani Industries financials

mln.	FY2010	FY2011	FY2012

Revenue	54,180	24,272	30,694
EBITDA	6,422	2,789	3,111
Net income	1,851	-483.993	-1,659.680
CAPEX	3,225	4,848	24,507
Debt	18,524	25,799	44,397
Cash	1,600	2,982	4,067

About Binani Industries

Binani Industries Limited, through its subsidiaries, manufactures and sells cement, zinc, and glass fiber and related composites in India and internationally. It provides ordinary portland cement of grades 43 and 53, Pozzolona Portland cement, and ground granulated blast-furnace slag; and high-grade electrolytic zinc, including zinc ingots, zinc alloys, and zinc dust primarily for use in galvanizing steel, manufacturing LPG regulators, automobile components, zippers, dry cell batteries, specialty chemicals, alloys, doorknobs, door handles and fittings, paint, and rubber and car tires, as well as sulfuric acid and cadmium plates. The company also offers fiberglass products and technologies for the reinforcement of thermoplastics and thermo sets, high-grade glass fiber, and glass reinforced plastics that are used to produce sheet molding compounds, as well as dough molding compounds for water storage, electrical, and industrial sectors; and long fiber thermoplastic composite materials for medical, construction, electronics, agriculture, recreation, industrial, appliances, automotive, and furniture industries. In addition, it provides engineering, procurement, and construction services; consultancy and engineering; and manufacturing services. Further, the company publishes a portfolio of trade journals, which provide information on the happenings in the metals, construction, and infrastructure industries, such as Minerals and Metals Review, a monthly magazine; Minerals and Metals Review Weekly, a tabloid that provides weekly updates on metal prices; Metals Today Daily, a daily electronic newsletter; and Construction Industry Review, a weekly tabloid. Binani Industries Limited was founded in 1872 and is based in Mumbai, India.