Rain Industries revenue decreased on 9.4% while EBITDA Margin increased slightly on 1.2 pp from 13.4% to 14.6%
23-02-2017 • About Rain Industries (
$RAIN) • By InTwits
Rain Industries reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- The company has business model with low profitability: ROIC is 9.4%
- It operates with high leverage: Net Debt/EBITDA is 4.7x while industry average is 4.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue decreased on 9.4%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.2 pp from 13.4% to 14.6% in FY2016. During the last 5 years EBITDA Margin bottomed in FY2014 at 10.3% and was growing since that time.
Net Income margin decreased slightly on 0.74 pp from 3.2% to 2.4% in FY2016.
Return on investment
The company operates at low ROIC (9.4%) and ROE (7.6%). ROIC showed almost no change in FY2016. ROE decreased on 3.4 pp from 11.0% to 7.6% in FY2016.
Leverage (Debt)
Debt level is 4.7x Net Debt / EBITDA and 5.5x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 4.9x to 4.7x in FY2016. Debt decreased slightly on 1.9% while cash jumped on 22.4%. During the last 5 years Net Debt/EBITDA topped in FY2014 at 5.5x and was declining since that time.
Rain Industries has no short term refinancing risk: cash is higher than short term debt (221.5%).
Valuation and dividends
Rain Industries's trades at EV/EBITDA 6.8x and P/E 12.7x while industy averages are 17.8x and 21.9x.
Management team
T Srinivasa Rao is a the company's CFO. T Srinivasa Rao has spent 8 years at the company.
Financial and operational results
Rain Industries ($RAIN) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 53,444 | 115,039 | 119,370 | 102,185 | 92,597 | -9.4% |
| SG&A | | | | | 8,576 | |
| EBITDA | 11,117 | 13,755 | 12,265 | 13,693 | 13,537 | -1.1% |
| Net Income | 4,577 | 3,845 | 885 | 3,233 | 2,247 | -30.5% |
Balance Sheet
|
|---|
| Cash | 46,631 | 8,410 | 8,959 | 8,568 | 10,491 | 22.4% |
| Short Term Debt | 882 | 5,867 | 5,048 | 4,634 | 4,737 | 2.2% |
| Long Term Debt | 61,756 | 74,508 | 71,678 | 71,323 | 69,756 | -2.2% |
Cash flow
|
|---|
| Capex | 5,284 | 3,654 | 3,986 | 4,987 | | |
Ratios
|
|---|
| Revenue growth | -5.2% | 115.3% | 3.8% | -14.4% | -9.4% | |
| EBITDA growth | -19.9% | 23.7% | -10.8% | 11.6% | -1.1% | |
|
|---|
| EBITDA Margin | 20.8% | 12.0% | 10.3% | 13.4% | 14.6% | 1.2% |
| SG&A, % of revenue | | | | | 9.3% | |
| Net Income Margin | 8.6% | 3.3% | 0.7% | 3.2% | 2.4% | -0.7% |
| CAPEX, % of revenue | 9.9% | 3.2% | 3.3% | 4.9% | | |
|
|---|
| ROIC | 13.3% | 10.2% | 8.0% | 9.6% | 9.4% | -0.2% |
| ROE | 19.6% | 13.3% | 2.9% | 11.0% | 7.6% | -3.4% |
| Net Debt/EBITDA | 1.4x | 5.2x | 5.5x | 4.9x | 4.7x | -0.2x |
Peers in Petrochemicals
Below you can find Rain Industries benchmarking vs. other companies in Petrochemicals 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.
