Supreme Infrastructure India reports 75.0% CAPEX decline in 2016 and 22.6% Revenue decline
31-05-2016 • About Supreme Infrastructure India (
$SUPREMEINF) • By InTwits
Supreme Infrastructure India reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Supreme Infrastructure India has high CAPEX intensity: 5 year average CAPEX/Revenue was 36.3%. At the same time it's a lot of higher than industry average of 5.8%.
- CAPEX is quite volatile: ₹2,079m in FY2016, ₹8,315m in FY2015, ₹11,068m in FY2014, ₹7,251m in FY2013, ₹8,055m in FY2012
- The company has potentially unprofitable business model: ROIC is 4.0%
- It operates with high leverage: Net Debt/EBITDA is 16.2x while industry average is 90.3x
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 dropped on 22.6%. Revenue decline was accelerating on average at -28.5 pp per annum in the last 5 years. EBITDA Margin showed almost no change in FY2016. EBITDA Margin stuck to a growing trend at 1.4 pp per annum in FY2012-FY2016.
Net Income margin dropped on 10.0 pp from -0.78% to -10.8% in FY2016. Net Income margin stuck to a declining trend at -3.6 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
In FY2016 Supreme Infrastructure India had CAPEX/Revenue of 14.8%. CAPEX/Revenue dropped on 16.3 pp from 31.1% in FY2013 to 14.8% in FY2016. It's average CAPEX/Revenue for the last three years was 34.6%. Supreme Infrastructure India invested a big chunk of EBITDA (75.2%) to CAPEX which didn't stop revenue from falling.
Return on investment
The company operates at low but positive ROIC (4.0%) and negative ROE (-19.7%). ROIC decreased on 2.3 pp from 6.2% to 4.0% in FY2016. ROE dropped on 18.0 pp from -1.8% to -19.7% in FY2016. ROIC followed a declining trend at -2.9 pp per annum in the last 5 years. ROE declined at -11.3 pp per annum in FY2012-FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 16.2x and Debt / EBITDA is 16.4x. Net Debt / EBITDA surged on 5.0x from 11.3x to 16.2x in FY2016. Debt increased on 8.3% while cash dropped on 57.5%. Net Debt/EBITDA stuck to a growing trend at 2.6x per annum in FY2012-FY2016.
Supreme Infrastructure India has short term refinancing risk: cash is only 4.6% of short term debt.
Financial and operational results
Supreme Infrastructure India ($SUPREMEINF) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 17,270 | 23,329 | 25,705 | 18,139 | 14,037 | -22.6% |
| EBITDA | 2,560 | 3,644 | 4,498 | 3,620 | 2,766 | -23.6% |
| Net Income | 791 | 1,002 | 792 | -141 | -1,519 | |
Balance Sheet
|
|---|
| Cash | 410 | 823 | 288 | 1,111 | 473 | -57.5% |
| Short Term Debt | 5,947 | 8,939 | 10,835 | 10,470 | 10,188 | -2.7% |
| Long Term Debt | 9,782 | 14,235 | 20,067 | 31,370 | 35,106 | 11.9% |
Cash flow
|
|---|
| Capex | 8,055 | 7,251 | 11,068 | 8,315 | 2,079 | -75.0% |
Ratios
|
|---|
| Revenue growth | 87.7% | 35.1% | 10.2% | -29.4% | -22.6% | |
| EBITDA growth | 101.5% | 42.4% | 23.4% | -19.5% | -23.6% | |
|
|---|
| EBITDA Margin | 14.8% | 15.6% | 17.5% | 20.0% | 19.7% | -0.3% |
| Net Income Margin | 4.6% | 4.3% | 3.1% | -0.8% | -10.8% | -10.0% |
| CAPEX, % of revenue | 46.6% | 31.1% | 43.1% | 45.8% | 14.8% | -31.0% |
|
|---|
| ROIC | 15.4% | 12.4% | 10.6% | 6.2% | 4.0% | -2.3% |
| ROE | 25.2% | 21.1% | 11.8% | -1.8% | -19.7% | -18.0% |
| Net Debt/EBITDA | 6.0x | 6.1x | 6.8x | 11.3x | 16.2x | 5.0x |
Peers in Construction & Engineering
Below you can find Supreme Infrastructure India benchmarking vs. other companies in Construction & Engineering 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 |
|---|
| Ramky Infrastructure ($RAMKY) | - | -5.0% | -37.9% | -33.6% | 44.2% |
| Shristi Infrastructure Development Corporation ($SHRISTI) | - | -2.1% | -2.3% | 1.0% | 28.2% |
| Prakash Constrowell ($PRAKASHCON) | - | 19.4% | -3.4% | -26.4% | 23.8% |
| Mbl Infrastructures ($MBLINFRA) | - | 7.1% | 30.3% | 11.1% | 19.4% |
| Skipper ($SKIPPER) | - | 21.5% | 15.7% | 26.0% | 14.7% |
| |
|---|
| Median (28 companies) | -11.6% | 6.7% | 6.6% | 1.2% | -5.1% |
|---|
| Supreme Infrastructure India ($SUPREMEINF) | - | 35.1% | 10.2% | -29.4% | -22.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Madhucon Projects ($MADHUCON) | 8.4% | 31.9% | 22.1% | 32.1% | 40.2% |
| Jaiprakash Associates ($JPASSOCIAT) | 36.9% | 35.9% | 32.4% | 31.5% | 27.6% |
| Arss Infrastructure Projects ($ARSSINFRA) | 14.0% | 13.9% | 22.0% | 31.3% | - |
| Reliance Industrial Infrastructure ($RIIL) | - | - | - | 30.8% | - |
| Shristi Infrastructure Development Corporation ($SHRISTI) | 27.2% | 30.0% | 30.0% | 29.8% | 29.6% |
| |
|---|
| Median (37 companies) | 11.9% | 11.2% | 10.2% | 9.9% | 10.6% |
|---|
| Supreme Infrastructure India ($SUPREMEINF) | 14.8% | 15.6% | 17.5% | 20.0% | 19.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Shristi Infrastructure Development Corporation ($SHRISTI) | 0.0% | 11.2% | 14.1% | 40.8% | 25.2% |
| Jaiprakash Associates ($JPASSOCIAT) | 97.0% | 65.5% | 45.0% | 31.6% | 18.9% |
| Mbl Infrastructures ($MBLINFRA) | 7.0% | 12.7% | 11.7% | 9.6% | 14.8% |
| Ramky Infrastructure ($RAMKY) | 10.6% | 11.9% | 8.6% | 1.4% | 6.8% |
| Skipper ($SKIPPER) | 7.6% | 6.6% | 3.1% | 2.5% | 6.7% |
| |
|---|
| Median (19 companies) | 7.3% | 6.6% | 4.0% | 3.1% | 3.5% |
|---|
| Supreme Infrastructure India ($SUPREMEINF) | 46.6% | 31.1% | 43.1% | 45.8% | 14.8% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skipper ($SKIPPER) | 10.4% | 13.5% | 14.7% | 27.4% | 24.4% |
| Voltas ($VOLTAS) | 19.6% | 11.7% | 11.8% | 19.3% | 18.2% |
| Spml Infra ($SPMLINFRA) | 8.6% | 9.7% | 7.1% | 10.6% | 13.1% |
| Mbl Infrastructures ($MBLINFRA) | 21.3% | 13.4% | 14.0% | 13.6% | 11.2% |
| Madhucon Projects ($MADHUCON) | -2.4% | 0.7% | 3.8% | 7.5% | 10.9% |
| |
|---|
| Median (35 companies) | 8.6% | 7.1% | 5.6% | 6.8% | 6.8% |
|---|
| Supreme Infrastructure India ($SUPREMEINF) | 15.4% | 12.4% | 10.6% | 6.2% | 4.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mcnally Bharat Engineering Company ($MBECL) | 4.3x | 7.0x | 7.6x | 28.3x | 2,779.7x |
| Atlanta ($ATLANTA) | 10.7x | 4.8x | 6.4x | 7.6x | 71.7x |
| Ramky Infrastructure ($RAMKY) | 3.1x | 4.6x | - | - | 20.6x |
| Jaiprakash Associates ($JPASSOCIAT) | 9.2x | 8.9x | 11.0x | 11.9x | 14.1x |
| Shristi Infrastructure Development Corporation ($SHRISTI) | 11.8x | 8.6x | 7.9x | 9.4x | 8.8x |
| |
|---|
| Median (25 companies) | 4.5x | 5.2x | 5.4x | 2.7x | 5.0x |
|---|
| Supreme Infrastructure India ($SUPREMEINF) | 6.0x | 6.1x | 6.8x | 11.3x | 16.2x |
