Ambuja Cements revenue jumped on 114% and EBITDA Margin decreased slightly on 0.91 pp from 16.4% to 15.5%
20-02-2017 • About Ambuja Cements (
$AMBUJACEM) • By InTwits
Ambuja Cements reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Ambuja Cements is a fast growth stock: FY2016 revenue growth was 114%, 5 year revenue CAGR was 18.7% at FY2016 ROIC 8.7%
- Ambuja Cements has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.0%. At the same time it's in pair with industry average of 6.8%
- CAPEX is quite volatile: ₹30,133m in FY2016, ₹29,987m in FY2015, ₹28,520m in FY2014, ₹17,867m in FY2013, ₹9,260m in FY2012
- The company has business model with low profitability: ROIC is 8.7%
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 jumped on 114%. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 0.91 pp from 16.4% to 15.5% in FY2016. EBITDA Margin declined at -2.2 pp per annum in the last 5 years.
Net Income margin decreased on 3.0 pp from 8.6% to 5.6% in FY2016. During FY2012-FY2016 Net Income margin topped in FY2014 at 15.0% and was declining since that time.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 4.6% in FY2016. Ambuja Cements showed decline in CAPEX/Revenue of 3.9 pp from 8.5% in FY2013 to 4.6% in FY2016. Average CAPEX/Revenue for the last three years was 6.5%. During FY2012-FY2016 CAPEX as a % of Revenue topped in FY2013 at 8.5% and was declining since that time.
Return on investment
The company operates at low ROIC (8.7%) and ROE (7.5%). ROIC increased slightly on 0.73 pp from 8.0% to 8.7% in FY2016. ROE showed almost no change in FY2016. ROE declined at -2.2 pp per annum in FY2012-FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.4x and Debt / EBITDA is 0.0x. Debt increased on 6.7% while cash dropped on 51.8%.
Ambuja Cements has no short term refinancing risk: cash is higher than short term debt (9,779.8%).
Management team
Ambuja Cements's CEO is Ajay Kapur. Ajay Kapur has 8 years tenure with the company. The company's CFO Suresh Joshi has spent 4 years with the company.
Financial and operational results
Ambuja Cements ($AMBUJACEM) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 97,395 | 91,099 | 99,305 | 93,880 | 200,940 | 114.0% |
| EBITDA | 24,894 | 16,587 | 19,283 | 15,423 | 31,192 | 102.2% |
| Net Income | 12,932 | 12,786 | 14,865 | 8,079 | 11,211 | 38.8% |
Balance Sheet
|
|---|
| Cash | 21,995 | 21,577 | 22,715 | 27,932 | 13,457 | -51.8% |
| Short Term Debt | 210 | 149 | 24 | 115 | 138 | 20.2% |
| Long Term Debt | 393 | 334 | 316 | 236 | 236 | 0.1% |
Cash flow
|
|---|
| Capex | 6,990 | 7,729 | 8,245 | 6,237 | 9,145 | 46.6% |
Ratios
|
|---|
| Revenue growth | 14.3% | -6.5% | 9.0% | -5.5% | 114.0% | |
| EBITDA growth | 24.7% | -33.4% | 16.3% | -20.0% | 102.2% | |
|
|---|
| EBITDA Margin | 25.6% | 18.2% | 19.4% | 16.4% | 15.5% | -0.9% |
| Net Income Margin | 13.3% | 14.0% | 15.0% | 8.6% | 5.6% | -3.0% |
| CAPEX, % of revenue | 7.2% | 8.5% | 8.3% | 6.6% | 4.6% | -2.1% |
|
|---|
| ROIC | 19.4% | 11.2% | 13.0% | 8.0% | 8.7% | 0.7% |
| ROE | 15.3% | 14.0% | 15.2% | 7.9% | 7.5% | -0.4% |
| Net Debt/EBITDA | -0.9x | -1.3x | -1.2x | -1.8x | -0.4x | 1.4x |
Peers in Cement & Cement Products
Below we provide Ambuja Cements benchmarking against other companies in Cement & Cement 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 |
|---|
| Deccan Cements ($DECCANCE) | - | -2.1% | -21.6% | 11.9% | 32.3% |
| Ncl Industries ($NCLIND) | - | -15.8% | -3.0% | 30.8% | 23.8% |
| J.K.Cement ($JKCEMENT) | - | 14.7% | -4.0% | 21.2% | 10.9% |
| K.C.P ($KCP) | - | 11.7% | -8.2% | 12.4% | 9.2% |
| Kakatiya Cement Sugar & Industries ($KAKATCEM) | - | 9.0% | 8.8% | -3.9% | 9.1% |
| |
|---|
| Median (15 companies) | 14.9% | 11.7% | -1.6% | 7.3% | -0.6% |
|---|
| Ambuja Cements ($AMBUJACEM) | - | -6.5% | 9.0% | -5.5% | 114.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Deccan Cements ($DECCANCE) | 22.8% | 13.2% | 14.7% | 14.9% | 19.9% |
| Ncl Industries ($NCLIND) | 26.4% | 13.6% | 6.7% | - | 18.8% |
| K.C.P ($KCP) | 19.2% | 9.4% | 11.7% | 13.0% | 18.1% |
| India Cements ($INDIACEM) | 20.6% | 18.4% | 12.4% | 15.1% | 17.8% |
| Heidelbergcement India ($HEIDELBERG) | 8.3% | 9.3% | 15.9% | 7.4% | 15.3% |
| |
|---|
| Median (15 companies) | 16.2% | 13.4% | 11.7% | 11.0% | 13.2% |
|---|
| Ambuja Cements ($AMBUJACEM) | 25.6% | 18.2% | 19.4% | 16.4% | 15.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Orient Cement ($ORIENTCEM) | - | 2.9% | - | 59.7% | 24.5% |
| K.C.P ($KCP) | 8.6% | 9.9% | 12.6% | 5.2% | 19.8% |
| J.K.Cement ($JKCEMENT) | 6.5% | 18.8% | 55.8% | 16.2% | 9.2% |
| Heidelbergcement India ($HEIDELBERG) | 51.5% | 19.2% | - | - | 7.6% |
| Birla Corporation ($BIRLACORPN) | 19.1% | 7.1% | 5.5% | 6.9% | 5.1% |
| |
|---|
| Median (13 companies) | 5.5% | 7.1% | 5.5% | 5.1% | 4.8% |
|---|
| Ambuja Cements ($AMBUJACEM) | 7.2% | 8.5% | 8.3% | 6.6% | 4.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Saurashtra Cement ($SAURASHCEM) | 38.6% | 42.7% | 13.9% | 26.9% | 23.6% |
| Deccan Cements ($DECCANCE) | 17.4% | 8.0% | 6.4% | 9.1% | 20.8% |
| K.C.P ($KCP) | 17.6% | 6.7% | 7.1% | 9.3% | 15.0% |
| Indian Hume Pipe Co ($INDIANHUME) | 7.6% | 13.8% | 15.0% | 18.0% | 14.5% |
| Acc ($ACC) | 20.2% | 12.7% | 11.0% | 9.9% | 8.9% |
| |
|---|
| Median (16 companies) | 13.7% | 8.3% | 6.4% | 8.7% | 8.4% |
|---|
| Ambuja Cements ($AMBUJACEM) | 19.4% | 11.2% | 13.0% | 8.0% | 8.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Udaipur Cement Works ($UDAICEMENT) | - | - | - | 17.1x | 358.6x |
| Orient Cement ($ORIENTCEM) | - | -0.1x | 1.1x | 3.5x | 6.8x |
| Prism Cement ($PRISMCEM) | 4.8x | 6.0x | 10.0x | 6.0x | 5.3x |
| J.K.Cement ($JKCEMENT) | 2.3x | 2.3x | 6.9x | 5.8x | 5.2x |
| India Cements ($INDIACEM) | 3.2x | 3.5x | 5.5x | 4.6x | 3.7x |
| |
|---|
| Median (15 companies) | 2.1x | 2.8x | 3.1x | 2.7x | 3.0x |
|---|
| Ambuja Cements ($AMBUJACEM) | -0.9x | -1.3x | -1.2x | -1.8x | -0.4x |
