Eih Net Income surged on 73.8% and Revenue increased on 4.7%
30-05-2018 • About Eih (
$EIHOTEL) • By InTwits
Eih reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Eih has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.6%. At the same time it's in pair with industry average of 12.3%
- CAPEX is quite volatile: ₹3,090m in FY2018, ₹2,592m in FY2017, ₹919m in FY2016, ₹1,498m in FY2015, ₹1,094m in FY2014
- The company has potentially unprofitable business model: ROIC is 5.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Eih's Revenue increased on 4.7%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.9 pp from 17.1% to 19.0% in FY2018.
Net Income margin increased on 4.5 pp from 6.8% to 11.2% in FY2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 19.3% in FY2018. Eih showed fast CAPEX/Revenue growth of 10.3 pp from 9.0% in FY2015 to 19.3% in FY2018. For the last three years the average CAPEX/Revenue was 13.9%. Eih investments to CAPEX were large: 102% of EBITDA.
Return on investment
The company operates at low ROIC (5.3%) and ROE (6.3%). ROIC increased slightly on 1.3 pp from 4.0% to 5.3% in FY2018. ROE increased on 2.6 pp from 3.7% to 6.3% in FY2018.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.1x and Debt / EBITDA is 1.7x. Net Debt / EBITDA jumped on 0.3x from 0.8x to 1.1x in FY2018. Debt surged on 39.8% while cash surged on 12.6%. During FY2014-FY2018 Net Debt/EBITDA bottomed in FY2016 at 0.3x and was growing since that time.
Eih has short term refinancing risk: cash is only 84.4% of short term debt.
Financial and operational results
FY ended 31-03-2018
Eih ($EIHOTEL) key annual financial indicators| mln. INR | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 15,466 | 16,683 | 16,589 | 15,268 | 15,984 | 4.7% |
| SG&A | | | 424 | | | |
| EBITDA | 3,358 | 3,779 | 3,451 | 2,611 | 3,030 | 16.0% |
| Net Income | 1,071 | 631 | 1,311 | 1,031 | 1,792 | 73.8% |
Balance Sheet
|
|---|
| Cash | 1,213 | 1,369 | 1,681 | 1,563 | 1,760 | 12.6% |
| Short Term Debt | 1,987 | 1,985 | 1,849 | 1,447 | 2,087 | 44.2% |
| Long Term Debt | 2,531 | 2,196 | 902 | 2,142 | 2,933 | 36.9% |
Cash flow
|
|---|
| Capex | 1,094 | 1,498 | 919 | 2,592 | 3,090 | 19.2% |
Ratios
|
|---|
| Revenue growth | 5.3% | 7.9% | -0.6% | -8.0% | 4.7% | |
| EBITDA growth | 13.2% | 12.5% | -8.7% | -24.3% | 16.0% | |
|
|---|
| EBITDA Margin | 21.7% | 22.7% | 20.8% | 17.1% | 19.0% | 1.9% |
| SG&A, % of revenue | | | 2.6% | | | |
| Net Income Margin | 6.9% | 3.8% | 7.9% | 6.8% | 11.2% | 4.5% |
| CAPEX, % of revenue | 7.1% | 9.0% | 5.5% | 17.0% | 19.3% | 2.4% |
|
|---|
| ROIC | 5.8% | 6.3% | 6.6% | 4.0% | 5.3% | 1.3% |
| ROE | 4.1% | 2.4% | 4.9% | 3.7% | 6.3% | 2.6% |
| Net Debt/EBITDA | 1.0x | 0.7x | 0.3x | 0.8x | 1.1x | 0.3x |
Peers in Hotels
Below we provide Eih benchmarking against other companies in Hotels 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Royal Orchid Hotels ($ROHLTD) | - | - | - | 10.3% | 8.3% |
| |
|---|
| Median (1 company) | 5.9% | 3.1% | 4.3% | 10.3% | 8.3% |
|---|
| Eih ($EIHOTEL) | - | 7.9% | -0.6% | -8.0% | 4.7% |
Top companies by EBITDA margin, %
| Top | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Royal Orchid Hotels ($ROHLTD) | - | - | 13.0% | 11.8% | 15.6% |
| |
|---|
| Median (1 company) | 20.0% | 20.0% | 20.7% | 11.8% | 15.6% |
|---|
| Eih ($EIHOTEL) | 21.7% | 22.7% | 20.8% | 17.1% | 19.0% |
Top companies by CAPEX/Revenue, %
| Top | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Royal Orchid Hotels ($ROHLTD) | - | - | 4.3% | 4.5% | 1.8% |
| |
|---|
| Median (1 company) | 11.4% | 4.9% | 6.5% | 4.5% | 1.8% |
|---|
| Eih ($EIHOTEL) | 7.1% | 9.0% | 5.5% | 17.0% | 19.3% |
Top companies by ROIC, %
| Top | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Royal Orchid Hotels ($ROHLTD) | - | - | 2.5% | 1.5% | 4.3% |
| |
|---|
| Median (1 company) | 2.8% | 2.3% | 2.8% | 1.5% | 4.3% |
|---|
| Eih ($EIHOTEL) | 5.8% | 6.3% | 6.6% | 4.0% | 5.3% |
Top companies by Net Debt / EBITDA
| Top | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Royal Orchid Hotels ($ROHLTD) | - | - | 2.7x | 4.0x | 2.5x |
| |
|---|
| Median (1 company) | 0.9x | 0.3x | 1.5x | 4.0x | 2.5x |
|---|
| Eih ($EIHOTEL) | 1.0x | 0.7x | 0.3x | 0.8x | 1.1x |
