Ntpc CAPEX surged on 20.3% while Revenue decreased on 2.3%
30-05-2016 • About Ntpc (
$NTPC) • By InTwits
Ntpc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ntpc has high CAPEX intensity: 5 year average CAPEX/Revenue was 25.4%. At the same time it's in pair with industry average of 34.8%
- CAPEX is quite volatile: ₹39,891m in FY2016, ₹59,776m in FY2015, ₹94,236m in FY2014, ₹118,710m in FY2013, ₹125,119m in FY2012
- The company has potentially unprofitable business model: ROIC is 6.5%
- It operates with high leverage: Net Debt/EBITDA is 5.8x while industry average is 7.9x
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 2.3%. Revenue decline was accelerating on average at -3.8 pp per annum in FY2012-FY2016. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 2.9 pp from 21.1% to 24.0% in FY2016.
Net Income margin increased slightly on 0.54 pp from 12.5% to 13.0% in FY2016.
Investments (CAPEX, working capital and M&A)
In FY2016 Ntpc had CAPEX/Revenue of 29.8%. The company showed small growth in CAPEX/Revenue of 0.85 pp from 28.9% in FY2013 to 29.8% in FY2016. It's average level of CAPEX/Revenue for the last three years was 26.0%. The company has spent a lot to CAPEX (124% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (6.5%) and ROE (11.9%). ROIC showed almost no change in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt level is 5.8x Net Debt / EBITDA and 6.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 6.0x to 5.8x in FY2016. Debt increased on 9.6% while cash jumped on 114%. Net Debt/EBITDA stuck to a growing trend at 0.6x per annum in FY2012-FY2016.
Ntpc has short term refinancing risk: cash is only 24.7% of short term debt.
Management team
Braja Bihari Tripathy is a the company's CEO. Braja Bihari Tripathy has spent 4 years with the company. Ntpc's CFO Kulamani Biswal has spent 6 years with the company.
Financial and operational results
Ntpc ($NTPC) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 649,583 | 706,111 | 784,787 | 799,440 | 781,361 | -2.3% |
| EBITDA | 146,469 | 177,050 | 196,016 | 168,579 | 187,500 | 11.2% |
| Net Income | 98,147 | 125,908 | 114,036 | 99,863 | 101,828 | 2.0% |
Balance Sheet
|
|---|
| Cash | 11,682 | 6,274 | 9,458 | 11,277 | 24,171 | 114.3% |
| Short Term Debt | 49,522 | 58,311 | 59,127 | 88,891 | 97,924 | 10.2% |
| Long Term Debt | 548,519 | 645,877 | 755,423 | 933,629 | 1,022,383 | 9.5% |
Cash flow
|
|---|
| Capex | 131,497 | 204,057 | 189,485 | 193,199 | 232,470 | 20.3% |
Ratios
|
|---|
| Revenue growth | 13.1% | 8.7% | 11.1% | 1.9% | -2.3% | |
| EBITDA growth | 15.6% | 20.9% | 10.7% | -14.0% | 11.2% | |
|
|---|
| EBITDA Margin | 22.5% | 25.1% | 25.0% | 21.1% | 24.0% | 2.9% |
| Net Income Margin | 15.1% | 17.8% | 14.5% | 12.5% | 13.0% | 0.5% |
| CAPEX, % of revenue | 20.2% | 28.9% | 24.1% | 24.2% | 29.8% | 5.6% |
|
|---|
| ROIC | 9.0% | 9.6% | 9.1% | 6.3% | 6.5% | 0.1% |
| ROE | 13.7% | 16.2% | 13.5% | 11.8% | 11.9% | 0.1% |
| Net Debt/EBITDA | 4.0x | 3.9x | 4.1x | 6.0x | 5.8x | -0.2x |
Peers in Electric Utilities
Below we provide Ntpc benchmarking against other companies in Electric Utilities 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 |
|---|
| Reliance Infrastructure ($RELINFRA) | - | -10.7% | -14.4% | -8.6% | 112.0% |
| Adani Power ($ADANIPOWER) | - | 65.7% | 128.0% | 21.7% | 34.1% |
| Gvk Power & Infrastructure ($GVKPIL) | - | 4.6% | 8.2% | 8.1% | 32.5% |
| Power Grid Corporation Of India ($POWERGRID) | - | 27.2% | 18.9% | 12.8% | 21.0% |
| Torrent Power ($TORNTPOWER) | - | 9.9% | 5.6% | 19.8% | 12.4% |
| |
|---|
| Median (14 companies) | 41.4% | 15.3% | 8.4% | 8.1% | 2.6% |
|---|
| Ntpc ($NTPC) | - | 8.7% | 11.1% | 1.9% | -2.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Power Grid Corporation Of India ($POWERGRID) | 83.7% | 85.6% | 84.9% | 85.8% | 87.0% |
| Orient Green Power Company ($GREENPOWER) | 24.4% | 53.3% | 57.8% | 82.8% | 86.9% |
| Bf Utilities ($BFUTILITIE) | 43.9% | 55.1% | 61.2% | 72.2% | - |
| Nhpc ($NHPC) | 71.4% | 66.5% | 59.3% | 63.4% | 59.9% |
| Jaiprakash Power Ventures ($JPPOWER) | 91.7% | 70.6% | 60.1% | 63.3% | 57.2% |
| |
|---|
| Median (18 companies) | 28.3% | 25.1% | 26.2% | 23.5% | 27.8% |
|---|
| Ntpc ($NTPC) | 22.5% | 25.1% | 25.0% | 21.1% | 24.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Power Grid Corporation Of India ($POWERGRID) | 184.3% | 172.4% | 173.4% | 169.8% | 120.3% |
| Nava Bharat Ventures ($NBVENTURES) | 69.0% | 30.5% | 70.6% | 55.3% | 89.8% |
| Jaiprakash Power Ventures ($JPPOWER) | 378.9% | 341.9% | 229.9% | 113.6% | 66.7% |
| Orient Green Power Company ($GREENPOWER) | 422.5% | 170.0% | 77.0% | 19.3% | 52.8% |
| Gvk Power & Infrastructure ($GVKPIL) | 139.1% | 136.7% | 109.1% | 52.7% | 36.9% |
| |
|---|
| Median (12 companies) | 104.0% | 46.8% | 39.9% | 19.3% | 18.5% |
|---|
| Ntpc ($NTPC) | 20.2% | 28.9% | 24.1% | 24.2% | 29.8% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ptc India ($PTC) | 11.2% | 10.4% | 13.6% | 12.3% | 13.6% |
| Torrent Power ($TORNTPOWER) | 19.0% | 7.3% | 4.9% | 8.1% | 12.2% |
| Adani Power ($ADANIPOWER) | 2.4% | -0.4% | 5.5% | 6.6% | 11.2% |
| Tata Power Co ($TATAPOWER) | 8.9% | 8.8% | 9.0% | 7.1% | 10.6% |
| Alstom T&D India ($ALSTOMT&D) | 0.0% | 15.7% | 14.6% | 16.1% | 10.6% |
| |
|---|
| Median (15 companies) | 4.8% | 5.4% | 4.9% | 5.6% | 6.5% |
|---|
| Ntpc ($NTPC) | 9.0% | 9.6% | 9.1% | 6.3% | 6.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lanco Infratech ($LITL) | 16.3x | 12.9x | 19.2x | 17.5x | 18.1x |
| Gvk Power & Infrastructure ($GVKPIL) | 19.1x | 23.9x | 20.1x | 20.2x | 14.2x |
| Jaiprakash Power Ventures ($JPPOWER) | 11.6x | 13.1x | 16.7x | 13.4x | 10.7x |
| Orient Green Power Company ($GREENPOWER) | 21.5x | 10.0x | 10.6x | 8.7x | 9.1x |
| Nava Bharat Ventures ($NBVENTURES) | 1.3x | 2.5x | 2.1x | 4.5x | 8.5x |
| |
|---|
| Median (15 companies) | 11.3x | 8.6x | 6.6x | 6.2x | 5.8x |
|---|
| Ntpc ($NTPC) | 4.0x | 3.9x | 4.1x | 6.0x | 5.8x |
