Electrosteel Castings CAPEX dropped on 14.7% in 2015 and Revenue decreased on 2.3%
12 May 2015 • About Electrosteel Castings (
$ECS) • By InTwits
Electrosteel Castings reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Electrosteel Castings has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.9%. At the same time it's in pair with industry average of 7.7%.
- CAPEX is quite volatile: 1,386 in FY2015, 1,625 in FY2014, 3,030 in FY2013, 2,491 in FY2012, 1,231 in FY2011
- The company has potentially unprofitable business model: ROIC is at 5.0%
- It operates with medium-size leverage: Net Debt/EBITDA is 8.0x while industry average is 8.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Electrosteel Castings ($ECS) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 18,707 | 21,017 | 22,141 | 24,592 | 24,018 | -2.3% |
| EBITDA | 2,699 | 2,074 | 1,981 | 3,546 | 3,085 | -13.0% |
| Net Income | 1,796 | -270 | -239 | -159 | -1,161 | 628.6% |
Balance Sheet
|
|---|
| Cash | 289 | 291 | 1,342 | 1,250 | 1,179 | -5.6% |
| Short Term Debt | 7,819 | 10,305 | 12,123 | 10,173 | 12,753 | 25.4% |
| Long Term Debt | 7,854 | 8,657 | 12,178 | 15,533 | 12,967 | -16.5% |
Cash flow
|
|---|
| Capex | 1,231 | 2,491 | 3,030 | 1,625 | 1,386 | -14.7% |
Ratios
|
|---|
| Revenue growth | 18.3% | 12.4% | 5.3% | 11.1% | -2.3% | |
| EBITDA growth | -19.5% | -23.2% | -4.5% | 79.0% | -13.0% | |
| EBITDA Margin | 14.4% | 9.9% | 8.9% | 14.4% | 12.8% | -1.6% |
| Net Income Margin | 9.6% | -1.3% | -1.1% | -0.6% | -4.8% | -4.2% |
| CAPEX, % of revenue | 6.6% | 11.9% | 13.7% | 6.6% | 5.8% | -0.8% |
| ROIC | 6.7% | 4.3% | 3.4% | 6.3% | 5.0% | -1.3% |
| ROE | 10.7% | -1.6% | -1.2% | -0.7% | -5.4% | -4.7% |
| Net Debt/EBITDA | 5.7x | 9.0x | 11.6x | 6.9x | 8.0x | 1.1x |
Revenue and profitability
The company's Revenue decreased on 2.3% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.6 pp from 14.4% to 12.8% in FY2015.
Net Income marign decreased on 4.2 pp from -0.65% to -4.8% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 5.8% in FY2015. Electrosteel Castings showed decline in CAPEX/Revenue of 6.1 pp from 11.9% in FY2012 to 5.8% in FY2015. For the last three years the average CAPEX/Revenue was 8.7%.
Return on investment
The company operates at low but positive ROIC (4.99%) and negative ROE (-5.43%). ROIC decreased slightly on 1.3 pp from 6.3% to 5.0% in FY2015. ROE decreased on 4.7 pp from -0.72% to -5.4% in FY2015.
Leverage (Debt)
Debt level is 8.0x Net Debt / EBITDA and 8.3x Debt / EBITDA. Net Debt / EBITDA jumped on 1.1x from 6.9x to 8.0x in FY2015. Debt showed almost no change in FY2015 while cash decreased on 5.6% in FY2015.
Appendix 1: Peers in Construction & Engineering
Below we provide Electrosteel Castings benchmarking against other companies in Construction & Engineering 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Larsen & Toubro ($LTOD) | 18.6% | 23.5% | 16.1% | 14.2% | |
| Hindustan Construction Co ($HIN) | | 14.0% | 4.3% | 13.6% | 7.1% |
| |
|---|
| Median (2 companies) | 18.6% | 18.7% | 10.2% | 13.9% | 7.1% |
|---|
| Electrosteel Castings ($ECS) | | 12.4% | 5.3% | 11.1% | -2.3% |
Top companies by EBITDA margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Larsen & Toubro ($LTOD) | 15.2% | 14.6% | 13.9% | 13.1% | |
| Hindustan Construction Co ($HIN) | 8.7% | 5.3% | 5.3% | 8.8% | 12.0% |
| |
|---|
| Median (2 companies) | 12.0% | 10.0% | 9.6% | 11.0% | 12.0% |
|---|
| Electrosteel Castings ($ECS) | 14.4% | 9.9% | 8.9% | 14.4% | 12.8% |
Top companies by CAPEX/Revenue, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hindustan Construction Co ($HIN) | 21.9% | 12.7% | 12.4% | 13.3% | 9.2% |
| Larsen & Toubro ($LTOD) | 14.2% | 11.5% | 10.6% | 8.2% | |
| |
|---|
| Median (2 companies) | 18.0% | 12.1% | 11.5% | 10.8% | 9.2% |
|---|
| Electrosteel Castings ($ECS) | 6.6% | 11.9% | 13.7% | 6.6% | 5.8% |
Top companies by ROIC, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Larsen & Toubro ($LTOD) | 12.3% | 11.1% | 9.6% | 8.6% | |
| Hindustan Construction Co ($HIN) | 5.2% | 1.9% | 1.3% | 4.8% | 7.4% |
| |
|---|
| Median (2 companies) | 8.8% | 6.5% | 5.5% | 6.7% | 7.4% |
|---|
| Electrosteel Castings ($ECS) | 6.7% | 4.3% | 3.4% | 6.3% | 5.0% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hindustan Construction Co ($HIN) | 10.0x | 18.8x | 20.3x | 12.3x | 9.3x |
| Larsen & Toubro ($LTOD) | 3.7x | 4.8x | 5.8x | 6.9x | |
| |
|---|
| Median (2 companies) | 6.8x | 11.8x | 13.0x | 9.6x | 9.3x |
|---|
| Electrosteel Castings ($ECS) | 5.7x | 9.0x | 11.6x | 6.9x | 8.0x |
