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Reliance Infrastructure CAPEX jumped on 30.6% and Revenue increased on 2.4%

24-04-2018 • About Reliance Infrastructure ($RELINFRA) • By InTwits

Reliance Infrastructure reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts: The company has business model with low profitability: ROIC is 7.7%.

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 increased on 2.4%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 5.0 pp from 19.5% to 24.5% in FY2018.

Net Income margin showed almost no change in FY2018.

Investments (CAPEX, working capital and M&A)


In FY2018 Reliance Infrastructure had CAPEX/Revenue of 6.0%. The company's CAPEX/Revenue increased on 6.0 pp from in FY2015 to 6.0% in FY2018. Average CAPEX/Revenue for the last three years was 6.9%.

Return on investment


The company operates at low ROIC (7.7%) and ROE (5.6%). ROIC increased on 2.3 pp from 5.3% to 7.7% in FY2018. ROE decreased slightly on 0.70 pp from 6.3% to 5.6% in FY2018.

Leverage (Debt)


Debt level is 3.6x Net Debt / EBITDA and 3.7x Debt / EBITDA. Net Debt / EBITDA dropped on 1.6x from 5.2x to 3.6x in FY2018. Debt decreased on 9.6% while cash jumped on 56.7%. During the last 5 years Net Debt/EBITDA topped in FY2015 at 10.9x and was declining since that time.

Reliance Infrastructure has short term refinancing risk: cash is only 28.9% of short term debt.

Financial and operational results


FY ended 31-03-2018

Reliance Infrastructure ($RELINFRA) key annual financial indicators

mln. INR201420152016201720182018/2017
P&L
Revenue132,815121,403257,416240,268245,9892.4%
EBITDA28,05923,05351,89546,83660,33228.8%
Net Income19,13718,0027,59614,25213,395-6.0%
Balance Sheet
Cash6,5045,3514,6766,76710,60256.7%
Short Term Debt92,40095,97368,41357,62936,725-36.3%
Long Term Debt150,491161,725237,873191,294188,301-1.6%
Cash flow
Capex25,53811,29314,75330.6%
Ratios
Revenue growth-14.4%-8.6%112.0%-6.7%2.4%
EBITDA growth-5.2%-17.8%125.1%-9.7%28.8%

EBITDA Margin21.1%19.0%20.2%19.5%24.5%5.0%
Net Income Margin14.4%14.8%3.0%5.9%5.4%-0.5%
CAPEX, % of revenue9.9%4.7%6.0%1.3%

ROIC4.5%2.8%6.5%5.3%7.7%2.3%
ROE7.3%6.7%3.1%6.3%5.6%-0.7%
Net Debt/EBITDA8.4x10.9x5.8x5.2x3.6x-1.6x

Peers in Electric Utilities


Below you can find Reliance Infrastructure benchmarking vs. other companies in Electric Utilities 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  FY2014 FY2015 FY2016 FY2017 FY2018
Tata Power Co ($TATAPOWER)8.6%-6.0%-12.5%-6.5%-
 
Median (1 company)8.8%8.1%2.6%-6.5%-
Reliance Infrastructure ($RELINFRA)--8.6%112.0%-6.7%2.4%


Top companies by EBITDA margin, %

Top  FY2014 FY2015 FY2016 FY2017 FY2018
Tata Power Co ($TATAPOWER)21.5%18.7%26.5%21.9%-
 
Median (1 company)26.2%23.5%31.3%21.9%-
Reliance Infrastructure ($RELINFRA)21.1%19.0%20.2%19.5%24.5%


Top companies by CAPEX/Revenue, %

Top  FY2014 FY2015 FY2016 FY2017 FY2018
Tata Power Co ($TATAPOWER)12.1%10.4%7.4%12.0%-
 
Median (1 company)35.1%20.1%21.1%12.0%-
Reliance Infrastructure ($RELINFRA)--9.9%4.7%6.0%


Top companies by ROIC, %

Top  FY2014 FY2015 FY2016 FY2017 FY2018
Tata Power Co ($TATAPOWER)9.0%7.1%10.6%6.6%-
 
Median (1 company)5.5%6.2%6.1%6.6%-
Reliance Infrastructure ($RELINFRA)4.5%2.8%6.5%5.3%7.7%


Top companies by Net Debt / EBITDA

Top  FY2014 FY2015 FY2016 FY2017 FY2018
Tata Power Co ($TATAPOWER)5.0x6.2x4.9x7.8x-
 
Median (1 company)6.2x6.1x5.8x7.8x-
Reliance Infrastructure ($RELINFRA)8.4x10.9x5.8x5.2x3.6x