Pokarna CAPEX surged on 97.3% and Revenue jumped on 20.8%
30-05-2016 • About Pokarna (
$POKARNA) • By InTwits
Pokarna reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Pokarna is a fast growth stock: FY2016 revenue growth was 20.8%, 5 year revenue CAGR was 18.8% at FY2016 ROIC 31.6%
- EBITDA Margin is expanding: 33.9% in FY2016 vs. 25.7% in FY2015 vs. 15.8% in FY2012
- Pokarna has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.5%. At the same time it's in pair with industry average of 5.7%
- CAPEX is quite volatile: ₹315m in FY2016, ₹160m in FY2015, ₹56m in FY2014, ₹102m in FY2013, ₹36m in FY2012
- The company has highly profitable business model: ROIC is 31.6%
- It operates with high leverage: Net Debt/EBITDA is 2.0x while industry average is 1.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Pokarna's Revenue jumped on 20.8%. During FY2012-FY2016 Revenue growth topped in FY2015 at 41.5%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 21.4 pp from 10.1% to 31.5% in FY2016. EBITDA Margin followed a growing trend at 4.5 pp per annum in the last 5 years.
Net Income margin increased on 3.4 pp from 9.6% to 13.0% in FY2016. Net Income margin followed a growing trend at 7.3 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 8.0% in FY2016. CAPEX/Revenue increased on 3.0 pp from 5.0% in FY2013 to 8.0% in FY2016. It's average CAPEX/Revenue for the last three years was 5.1%.
Return on investment
The company operates at high and attractive ROIC (31.6%) and ROE (68.4%). ROIC jumped on 13.7 pp from 17.9% to 31.6% in FY2016. ROE dropped on 11.2 pp from 79.6% to 68.4% in FY2016. ROIC stuck to a growing trend at 7.1 pp per annum in the last 5 years. ROE grew at 41.6 pp per annum in FY2012-FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.0x and Debt / EBITDA is 2.0x. Net Debt / EBITDA dropped on 1.4x from 3.3x to 2.0x in FY2016. Debt decreased on 6.4% while cash decreased slightly on 0.57%. Net Debt/EBITDA followed a declining trend at -1.7x per annum in the last 5 years.
Pokarna has short term refinancing risk: cash is only 11.6% of short term debt.
Valuation and dividends
The company's trades at EV/EBITDA 6.2x and P/E 11.1x while industy averages are 17.8x and 21.9x. Pokarna's EV/(EBITDA-CAPEX) is 8.1x with the industry average at 22.8x.
Financial and operational results
Pokarna ($POKARNA) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,808 | 2,035 | 2,306 | 3,264 | 3,943 | 20.8% |
| EBITDA | 286 | 350 | 483 | 840 | 1,336 | 59.0% |
| Net Income | -309 | -66 | 117 | 314 | 512 | 63.3% |
Balance Sheet
|
|---|
| Cash | 36 | 61 | 28 | 108 | 107 | -0.6% |
| Short Term Debt | 523 | 789 | 1,036 | 894 | 925 | 3.4% |
| Long Term Debt | 1,850 | 1,951 | 2,065 | 2,008 | 1,792 | -10.8% |
Cash flow
|
|---|
| Capex | 36 | 102 | 56 | 160 | 315 | 97.3% |
Ratios
|
|---|
| Revenue growth | 8.4% | 12.6% | 13.3% | 41.5% | 20.8% | |
| EBITDA growth | 9.0% | 22.5% | 37.7% | 74.1% | 59.0% | |
|
|---|
| EBITDA Margin | 15.8% | 17.2% | 20.9% | 25.7% | 33.9% | 8.1% |
| Net Income Margin | -17.1% | -3.3% | 5.1% | 9.6% | 13.0% | 3.4% |
| CAPEX, % of revenue | 2.0% | 5.0% | 2.4% | 4.9% | 8.0% | 3.1% |
|
|---|
| ROIC | 3.0% | 4.5% | 8.8% | 17.9% | 31.6% | 13.7% |
| ROE | -82.2% | -35.2% | 56.6% | 79.6% | 68.4% | -11.2% |
| Net Debt/EBITDA | 8.2x | 7.6x | 6.4x | 3.3x | 2.0x | -1.4x |
Peers in Construction Materials
Below you can find Pokarna benchmarking vs. other companies in Construction Materials 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 |
|---|
| Ramco Industries ($RAMCOIND) | - | 15.3% | -10.4% | 9.8% | 0.8% |
| |
|---|
| Median (1 company) | - | 15.3% | -10.4% | 9.8% | 0.8% |
|---|
| Pokarna ($POKARNA) | - | 12.6% | 13.3% | 41.5% | 20.8% |
Top companies by EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Glittek Granites ($GLITTEKG) | - | - | - | 9.2% | - |
| Ramco Industries ($RAMCOIND) | 17.0% | 14.4% | 7.7% | 9.0% | 9.1% |
| Pacific Industries ($PACIFICI) | - | - | - | 4.5% | - |
| Milestone Global ($MILESTONE) | - | - | - | 3.9% | - |
| |
|---|
| Median (4 companies) | 17.0% | 14.4% | 7.7% | 6.8% | 9.1% |
|---|
| Pokarna ($POKARNA) | 15.8% | 17.2% | 20.9% | 25.7% | 33.9% |
Top companies by CAPEX/Revenue, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ramco Industries ($RAMCOIND) | 12.4% | 3.7% | 20.7% | 2.8% | 3.4% |
| |
|---|
| Median (1 company) | 12.4% | 3.7% | 20.7% | 2.8% | 3.4% |
|---|
| Pokarna ($POKARNA) | 2.0% | 5.0% | 2.4% | 4.9% | 8.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ramco Industries ($RAMCOIND) | 14.4% | 12.0% | 1.6% | 5.6% | 5.5% |
| Triveni Glass ($TRIVENIGQ) | - | - | - | - | - |
| Milestone Global ($MILESTONE) | - | - | - | - | - |
| Oriental Trimex ($ORIENTALTL) | 8.5% | -2.8% | - | - | - |
| Pacific Industries ($PACIFICI) | 7.8% | 16.6% | - | - | - |
| |
|---|
| Median (7 companies) | 8.2% | 9.9% | 1.6% | 5.6% | 5.5% |
|---|
| Pokarna ($POKARNA) | 3.0% | 4.5% | 8.8% | 17.9% | 31.6% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ramco Industries ($RAMCOIND) | 1.1x | 2.1x | 6.2x | 4.7x | 3.0x |
| Pacific Industries ($PACIFICI) | 2.0x | 0.1x | - | 0.0x | 0.0x |
| Madhav Marbles & Granites ($MADHAV) | -0.0x | -0.7x | 0.0x | - | 0.0x |
| |
|---|
| Median (3 companies) | 2.2x | 2.1x | 0.0x | 0.0x | 0.0x |
|---|
| Pokarna ($POKARNA) | 8.2x | 7.6x | 6.4x | 3.3x | 2.0x |
