Kansai Nerolac

 

Kansai Nerolac Paints Ltd is engaged in the manufacturing, distribution, and marketing of paints, emulsion, distempers for walls and ceilings, and paints for industrial and automotive use.

BSE

500165

NSE

KANSAINER

REUTERS

KANE.BO

INCEPTION

1920

IPO

1990

INDUSTRY

FURNISHING PAINTS

CMP (as on 6/11/2015)

369

Stock Beta

0.48

52 Week H/L

23.80-384.45

Market Cap (Cr)

19945

Equity Capital (cr)

53.89

Face Value (Rs)

1

Average Volume

77,813

Shareholding Pattern (%)

Promoters

73.99

Non Institutions

26.01

Grand Total

100.00

 

Potential Catalysts

  • Rising demand in Urban India, attributable to increased purchasing power and changing consumer preferences.

  • Government’s sharp focus on infrastructure - Make in India, Housing for All, Smart Cities Mission, Sagarmala Project, Bharat Mala Project, Rurban Mission.

  • Improved economic growth and lower inflation levels resulted in increased consumption.

  • Recovery in automotive segments to increase paint consumption.

  • Expansion plants to increase total output capacity by 23%.

 

Kansai Nerolac Paints Ltd - Recommendation

With its substantial liquidity and financial strength along with long product life cycles, the company is well positioned to address challenges related to technology evolution through acquisitions and internal investments. Capacity expansion by 23%, expected PE expansion, revenue CAGR of 16% for FY17-FY21 will drive stock price in the future. We recommend BUY on the stock at CMP of Rs. 369 to target of Rs. 412.

 

Kansai Nerolac Paints Ltd - Financial Summary

 

2016

2017 E

2018 E

2019 E

2020 E

2021 E

Total Income

4716.88

4957

5727

6620

7621

8777

EBITDA

564.92

769

866

978

1092

1217

Adjusted Net Profit

470.82

568

633

708

783

864

EPS

8.74

10.55

11.75

13.14

14.52

16.04

EBITDA Margin

13.63%

15.68%

15.25%

14.89%

14.42%

13.95%

EBIT Margin

25.81%

14.99%

14.43%

13.95%

13.38%

12.82%

PAT Margin

9.98%

11.47%

11.06%

10.70%

10.27%

9.85%

Value of Kansai Nerolac

17491.29

 

 

Terminal growth

7.5%

Value per share

323

 

 

WATCH

8.97%

 
Kansai Nerolac Paints Ltd - BUSINESS DISCRIPTION

Goodlass Nerolac Paints Ltd.(GNPL), the Indian subsidiary of Japan based Kansai Paint Co. Ltd, is the second largest paint company in India with presence in decorative paints as well as industrial paints & marine paints, enamels, varnishes, coatings, resins etc. It is the second largest coating company in India. The company markets its products under the brand names Nerolac, Glossolite, Goody, Allscapes, Excel, in decoratives. The Company was established in 1920 as Gahagan Paints and Varnish Co. Ltd. at Lower Parel in Bombay. In 1930, three British companies merged to formulate Lead Industries Group Ltd. In 1933, Lead Industries Group Ltd. acquired entire share capital of Gahagan Paints in 1933 and thus, Goodlass Wall (India) Ltd. was born.

Subsequently, by 1946, Goodlass Wall (India) Ltd. was known as Goodlass Wall Pvt. Ltd. In 1957, Goodlass Wall Pvt. Ltd. grew popular as Goodlass Nerolac Paints (Pvt.) Ltd. Also, it went public in the same year and established itself as Goodlass Nerolac Paints Ltd. It came into the fold of Tata Forbes Group in 1976, as its foreign holdings were acquired by Forbes Gokak. It turned into Joint Venture company in 1986 as the foreign colloborator Japan based Kansai Paints picking 36% of equity capital of the company. With the acquisition of entire stake of Forbes Gokak and its associates by Kansai Paints it became the subsidiary of the latter in 1999. The stake of Kansai Paints in the company now stood at 64.52% of the total equity of the company. The company has five manufacturing facilities at kanpur, Ratnagiri, Ahmedabad, Perungudi, Rewari spread across India. The Company serves its customers through 66 Sales locations and five strategically located factories.

Technical Assistance Agreements of the company with renowned players in paint industry at international level puts the company in a strong position to offer products which meets stringent international specifications. It started in 1993 when the company tied-up with Kansai Paints of Japan (for manufacture of Sophisticated architectural Coatings) and Nihon Tokushu Torya Co. Ltd also of Japan(for body seal and under seal coatings). And the latest being the technical assistance agreement with Dupont Performance Coatings GmbH & Co. KG, Germany for know-how of manufacture of Anodic Electro-deposition Coatings System during the year 2000-01. The companys other Technical Assistance agreements include E.I. Dupont De Nemours & Co. Inc. of USA for automotive coatings; Oshima Kogyo Company Ltd., of Japan for heat resistant paints; Valspar Corporation of US for powder coatings; Drew Chemicals Corporation of US for water and fuel treatment chemicals and Ameron Inc. USA for high performance coatings.

The company has strong presence in automotive paints as it controls 45% of the organised Industrial paint segment. Its major clients include OEMs like Maruti Udyog, Bajaj Auto, TELCO and Mahindra & Mahindra. It was a pioneer in introducing electro-deposition (ED) technology for Maruti, capturing a sizeable share of the automotive paint market.The company has two wholly owned subsidiaries namely Saurashtra Paints and and GNP (Madras). The above subsidiary companies were amalgamated with the company from April,2002 with consent approval from both the states High courts.

It has the software package, computerised colour dispensing machine from Fluid Management Holland, Gyroshaker of 10-Litre capacity touch screen monitor, 136 column palette-share display unit and a Kirloskar Champion UPS 1 KVA. The system has an ability to supply over 1305 shades accurately, consistently and instantly in several products covering a variety of application viz doors, windows, walls, exteriors, gates, grills etc.

During 2001-02, the company has entered into a technical agreement with EFTEC Shroff (India) Ltd. for the manufacture and supply of Automotive Paint Shop Sealers and Underbody Compounds.

The Company is in the process of setting up a new manufacturing unit at Bawal,Haryana at an estimated cost of Rs.100 crores with an annual capacity of 20000 MT p.a. The above project is being financed through internal accruals. During 2004-05 the company has setup a new greenfield plant, with a capacity of 20400 MT, at Bawal, district Rewari of Haryana and this was commissioned on 19th March 2005.

During 2003-04, the capacity at the Jainpur was increased by 24% for water based paints, by setting a new facility. Consequent to the approval of the High Court of Madras and Bombay the amalagmation of Chemguard Coatings Ltd with the company was completed on 1st September 2005.

During 2005-2006, the company made an investment in a Malaysian Company, a joint venture company between the company and Kansai Paint Co Ltd., Japan (Kansai), where the company will hold 55% stake and 45% Stake by Kansai. Further the Malaysian company has entered into an agreement to acquire the paint business of Sime Coatings Sdn.Bhd., Malaysian and this is subject to approval.

During the same period the companies Production capacity of Paints Varnishes and enamels has increased from 138400 MT to 153900 MT. The capacity of Synthetic Resins stood at 36250 MT and Capacity of Pretreatment Chemicals stood at 2400 MT.

 
MANAGEMENT & GOVERNANCE

Management

Vice-Chairman

D M Kothari

Managing Director

H M Bharucha

Chairman

Pradip P Shah

Director

Noel N Tata

Whole-time Director

Pravin D Chaudhari

Company Secretary

G T Govindarajan

Director

Masaru Tanaka

Nominee

Hidenori Furukawa

Independent Director

Brinda Somaya

Director

Katsuhiko Kato

 
Shareholding Pattern as on June 2016

Share Holding

 

No of Shares

% of Holding

Description as on

 

 

Total of Promoter

398736619

73.99

Non Promoter (Institution)

87325663

16.2

Non Promoter (Non-Institution)

52857438

9.81

Total Non Promoter

140183101

26.01

Grand Total

538919720

100

 

 
INDUSTRY OUTLOOK

The paints industry is an Oligopoly. Only a few players dominate the organized market.

  • 65% is an organized market
  • 35% is the unorganized market.

Organized - Asian Paints, Kansai Nerolac, Berger Paints, ICI control 80% of the organized market. Unorganized – 2000 SME paint manufacturing plants.

Market Share of paint companies in the organized market

Demand for paints comes from two broad categories

  1. Decorative Paints

    The decorative paints segment entails a major part of the industry and primarily caters to residential and commercial buildings. The decorative paint market has been further segmented into emulsions, enamel, distemper, and cement paints. Enamels are the most widely used followed by distempers and emulsions. Interior and exterior paints account for 75% and 25% of the decorative paints respectively.

    The paint industry currently stands at Rs 40,600 crore with per capita consumption increasing to over 4 kgs, out of which the decorative segment contributed nearly 73% at Rs. 29,638 crore, while the remaining Rs. 10,962 crore was contributed by the industrial segment. The major boost to the growth in the Indian paint market has been provided by the decorative paint segment, which is anticipated to grow more than 18%.

    Per capita paint consumption

    Industrial Paints

    Three main segments of the industrial sector include automotive coating, high-performance coating, powder coating, and coil coating, adding the paper. Kansai Nerolac is the market leader in this segment. This segment includes paints used in automobiles, auto ancillaries, consumer durables, containers, etc. User industries for industrial paints include automobiles engineering and consumer durables. The industrial paints segment is far more technology-intensive than the decorative segment.

This segment is price sensitive and is a higher margin business as compared to the industrial segment. The paint industry is raw material intensive. Most of the raw materials are petroleum-based. Thus paint companies are enjoying margins with low crude oil prices. Raw materials frequently run into short supply, resulting in high inventory costs. The shortage of one specific material could result in severe manufacturing problems.

 
Kansai Nerolac Paints Ltd - INVESTMENT RATIONALE

Leader in automotive paints in India. Capacity addition of 42000MT in Gujurat, 38000MT in Amritsar will increase total output capacity by 23%.

Pioneers in making paints safe and Nerolac stands for healthy home paints. One stop solution for most eco-friendly and innovative Decorative paints and Industrial coatings. Low VOC and Lead free healthy home paints and market leaders in Industrial Coatings branded by Shahrukh khan.

The company has strong presence in automotive paints as it controls 45% of the organized Industrial paint segment. Company has invested huge money on R&D to be leader in innovation. They have 600 crore capex plan to increase capacity in next two years. This will help them match increasing demand.

Capacity Addition

Add: Gujarat having capacity of 42000 MT per year at an estimated cost of `350 Crores.

Add: Goindwal Sahib near Amritsar in Punjab having capacity of 38000 MT per year at an estimated cost of`180 Crores.

This will increase capacity by 23%.

Paint output in June 2016 up 6% YoY.

Consumption growth on the back of seventh pay commission payout as well as onset of festival demand has facilitated the industry to carry forward the volume growth momentum of second half of last fiscal into current fiscal. Rise in prices of some raw materials off-late is eliciting margin concerns.

The output of paints for the month of June 2016 stood at 70547 tonnes, a growth of 6.1%yoy. But the output of paints was down by 4.3%MoM from 73686 tonnes registered in May 2016. The output for the first quarter ended June 2016 was up by 10.4%yoy to 216988 tonnes. With this the growth momentum in output of paints sustained for the third quarter in a row. The output for H2FY2015-16 was up by 8.18%yoy to 398336 tonnes with the paints output for Q3FY16 and Q4FY16 up by 9.21% and 7.17% respectively.

Paints demand though gets a boost by the way of approach of Deepawali festival in October 2016 backed by higher disposable income due to seventh pay commission payout as well as expected improvement in rural income the market conditions continues to be challenging and competitive especially in decorative coatings. This has forced the industry majors to be combative with aggressive price especially in price sensitive segments and other marketing strategic measures such as dealer/channel incentives etc. While the premium end products volume continues to growth from low base, the medium segment demand seems the one that is muted.

Price of some major raw materials marginally increases

Paint Industry being one of raw material intensive and the raw material cost accounts for about 50-60% (~63% for Kansai Nerolac) of the total cost of production and thus the profit of the industry players swings with the material cost. Sharp decline in crude oil prices and consequent decline in raw material prices helped in margin expansion.

 

2009

2010

2011

2012

2013

2014

2015

2016

Purchases of Raw Material

768.12

964.73

1270.74

1546.43

1715.23

1884.28

1866.01

1942.46

Sales Turnover

1663.74

1971.7

2482.5

3019.88

3375.65

3739.02

4211.64

4604.36

Raw Material to Sales

0.46

0.49

0.51

0.51

0.51

0.50

0.44

0.42

Crude Oil price

61.95

79.48

94.88

94.05

97.98

93.17

48.66

45.55

Correlation or R2

0.9859

 

 

 

 

 

 

 

R

0.97

 

 

 

 

 

 

 

We see positive (absolute) correlation between Raw Material Cost and Crude oil price. Thus when cost of paint production will increase or decrease with an increase or decrease with oil prices.

Raw materials are divided into three major groups

  • Pigments (titanium dioxide, zinc oxide etc.)

  • solvents (mineral turpentine)

  • resins and additives

In the manufacture of paint there are more than 275 raw materials both crude based and non-crude based are consumed. Major of over 275 raw materials are phthalic anhydride (PAN), a petroleum-based material, and titanium dioxide (TiO2), which accounts for 30% of the total raw material requirement. Titanium Dioxide, a mineral-based material, is classified into two varieties, such as rutile grade and anatase grade. The paint companies have been opting for importing the anatase grade because of its better quality than those available from domestic sources. The other raw materials for the industry, such as organic pigments and Penta, are available domestically.

 

2017 E

2018 E

2019 E

2020 E

2021 E

Crude Oil (S&P projections)

46

50

52

55

55

Crude oil prices are expected to increase gradually, Tio2 prices are already on an uptrend, and advertisement costs are also increasing. This will increase the cost and margins are expected to dilute.

Rising demand in Urban India, attributable to increased purchasing power and changing consumer preferences.

The decorative paints segment has witnessed strong growth over the last few years on account of the substantial increase in disposable income. The demand for premium paints & niche products is growing due to changes in trends like paints for specific social occasions like marriage, Vastu, and festivals such as Diwali have led to the higher realization for decorative paints.

Indian consumer segment is broadly segregated into urban and rural markets and is attracting marketers from across the world. The sector comprises a huge middle class, relatively large affluent class, and a small economically disadvantaged class, with spending anticipated to more than double by 2025.

The growing purchasing power and the rising influence of social media have enabled Indian consumers to splurge on good things. The Indian consumer sector has grown at an annual rate of 5.7 percent between FY2005 to FY 2015. Annual growth in the Indian consumption market is estimated to be 6.7 percent during FY2015-20 and 7.1 percent during FY2021-25.

With 66% of its population under the age of 35, India is home to the largest cohort of young people in the world—825 million. The median age of the country is just 27 years, much below 37 in the US and 46 in Japan. India's demographic profile is unstable and is changing in a way that is quite favorable to economic growth. Growth of the working-age share of the population and increase in the number of nuclear families is fueling the rise in per capita spent.

Government’s sharp focus on infrastructure - Make in India, Housing for All, Smart Cities Mission, Sagarmala Project, Bharat Mala Project, Rurban Mission.

The government is readying a strategy to focus on infrastructure, agriculture, and restoring the health of the banking system as well as specific measures to ease stress in the rural economy as part of the 2016-17 Budget. The rural economy, a key driver of demand and support for the broader economy, has taken a knock from the two back-to-back seasons of patchy monsoon rains. The segment drives demand for everything from motorcycles to tractors, televisions, and refrigerators. Finance minister Arun Jaitley has already signaled the government's support by backing calls for raising investment in the crucial farm sector and leveraging technology to fire up growth. The government has taken several measures, including pumping in Rs 70,000 crore to recapitalize state-run banks.

Along with this, Smart cities mission, Sagarmala, Rurban Mission are infusing hundreds of crores on housing and development. This will indirectly create demand for paint.

Improved economic growth and lower inflation levels resulted in increased consumption and recovery in automotive segments to increase paint consumption will also create demand for the paint industry.

Expected PE expansion, revenue CAGR of 16% for FY17-FY21 will drive stock price in the future.

The company has differentiated its product portfolio by offering eco-friendly, lead-free, low VOC & economical series of affordable emulsion paints with High Definition Color Technology (HD). Also, the company launched eco-friendly plastic coatings for cars and a new range of powder coating products through technology tie-up with Protech Canada.

Kansai Nerolac has strong management and technical R&D team to handle changing customer needs. We believe with new projects and capacity expansion, Nerolac can match growing demand with an increase in supply. They have excellent client profiles and technical assistance agreements with companies.

Technical Assistance Agreements of the company with renowned players in the paint industry at an international level puts the company in a strong position to offer products that meet stringent international specifications.

  • Tie-up with Kansai Paints of Japan for the manufacture of Sophisticated architectural Coatings

  • E.I. Dupont De Nemours & Co. Inc. of the USA for automotive coatings

  • Oshima Kogyo Company Ltd., of Japan for heat resistant paints

  • Valspar Corporation of US for powder coatings

  • Drew Chemicals Corporation of US for water and fuel treatment chemicals

  • Ameron Inc. USA for high-performance coatings

Along with these, Nerolac is spending a good amount of money on advertisement to increase branding. We believe this will have long-term benefits for the company.

 

Co_Name

Std Sales

 

CAGR

2011

2012

2013                  2014

2015

2016

Asian Paints

7242.65

9118.92

10462.94                         12167.02

13656.9

14950.6

 

12.8%

Berger Paints

2299.1

2901.22

3330.61             3735.35

4212.94

4580.72

 

12.2%

Kansai Nerolac

2482.5

3019.88

3375.65             3739.02

4211.64

4604.36

 

10.8%

 

 

 

Sales Growth

 

 

 

 

 

2011

2012

2013                  2014

2015

2016

 

Geo Mean

Asian Paints

 

25.91%

14.74%              16.29%

12.25%

9.47%

 

14.8%

Berger Paints

 

26.19%

14.80%              12.15%

12.79%

8.73%

 

13.9%

Kansai Nerolac

 

21.65%

11.78%              10.76%

12.64%

9.32%

 

13.6%

 

 

 

 

 

 

Industry Avg

14.1%

 

 

Capex

 

CAGR

2011

2012

2013                  2014

2015

2016

Asian Paints

410.25

591.68

439.87               617.73

292.27

862.78

 

13.2%

Berger Paints

29.2

67.06

192.55               304.04

168.72

258.3

 

43.8%

Kansai Nerolac

56.44

12.15

141.84               112.46

238.74

-145.3

 

33.4%

 

 

 

Capex % of Sales

 

 

 

 

 

2011

2012

2013                  2014

2015

2016

 

Geo Mean

Asian Paints

5.7%

6.5%

4.2%                 5.1%

2.1%

5.8%

 

4.6%

Berger Paints

1.3%

2.3%

5.8%                 8.1%

4.0%

5.6%

 

3.8%

Kansai Nerolac

2.3%

0.4%

4.2%                 3.0%

5.7%

-3.2%

 

2.3%

 

 

 

 

 

 

Industry Avg

3.6%

 

 

Co_Name

Advertisement and Sales Promotion

 

2011

2012                2013                  2014                       2015

2016

Asian Paints

282.35

338.59               422.87               504.03                         596.72

740.05

 

 

Berger Paints

103.2

136.73               170.71               194.95                         258.61

295.09

 

 

Kansai Nerolac

82.11

100.12               102.28               114.28                         146.56

228.92

 

 

 

 

Advertisement and Sales Promotion % of Sales

 

 

 

 

2011

2012                2013                  2014                       2015

2016

 

Geo Mean

Asian Paints

3.9%

3.7%                 4.0%                 4.1%                         4.4%

4.9%

 

4.2%

Berger Paints

4.5%

4.7%                 5.1%                 5.2%                         6.1%

6.4%

 

5.3%

Kansai Nerolac

3.3%

3.3%                 3.0%                 3.1%                         3.5%

5.0%

 

3.2%

 

 

 

 

Industry Avg

4.2%

VALUATION

Kansai Nerolac is currently trading at 369 per share with a market capitalization of 19,945 Crores. It has total long-term debt of 64 Cr with long-term Debt to Equity of 0.03. It has total cash and bank balance of 479 Cr.

The company is a regular dividend payer.

Year-End

Div. Yield-%

2016

1.08

2015

0.65

2014

0.94

2013

0.89

2012

1.21

2011

1.12

2010

1.15

 

We have used DCF to value Kansai Nerolac with a fair price of Rs 323 per share. We have assumed an effective tax rate at 22%, cost of capital at 8.97%, and terminal growth rate at 7.5%. The company has CAPEX spending of 600 Crs for capacity expansion plans and for setting up an R&D facility in Mumbai. The company has enough cash for expansion and working capital needs. For valuation, we assume that over the period company will keep the capital structure unaltered and the tax rate unchanged.

Peer comparison

 

Key Sectoral Data

Market Cap (Rs Crore)

159442

Market Cap (USD Million)

23447

P/ E

48.7

P/ BV

15.7

Debt/ Equity

0.2

ROA (%)

17.4

ROE (%)

32.2

EV/ Sales

6.3

EV/ EBITDA

30.9

Kansai Nerolac is trading at discount to its peers. EV/EBITA is 13 against 26 for its immediate peers. We believe that the company should trade on par with its peer companies with strong brand equity, excellent client profile, healthy growth prospects, better return ratios, a strong balance sheet, and prudent management.

 

Inventories

Capex

P/E

P/BV

EV/EBIDTA

Co_Name

2014

2015

2016

2014

2015

2016

2014

2015

2016

2014

2015

2016

2014

2015

2016

Asian Paints

2069.86

2258.52

2064

585.99

464.99

869.06

46.12

60.49

52.71

12.98

16.36

14.86

24.64

32.62

28.07

Berger Paints

695.66

719.47

758.16

301.38

183.55

257.18

33.66

58.65

48.9

7.1

11.49

11.47

17.96

27.28

24.96

Kansai Nerolac

658.33

555.14

582.72

113.22

238.68

-145.73

31.84

45.14

17.66

4.42

7.27

6.61

16.74

24.68

12.95

 

Co_Name

CMP

EPS (cons.)

BV (cons.)

P/E Ratio (cons.)

P/BV (cons.)

Asian Paints

1191.2

19.64

58.44

60.55

20.35

Berger Paints

260.2

4.26

15.23

61.16

17.09

Kansai Nerolac

370.3

8.7

42.6

45.79

8.7

Average

 

 

 

60.86

18.72

CONCUSSION AND RECOMMENDATION

With its substantial liquidity and financial strength along with long product life cycles, the company is well-positioned to address challenges related to technology evolution through acquisitions and internal investments. Capacity expansion by 23%, expected PE expansion, revenue CAGR of 16% for FY17-FY21 will drive stock price in the future. We recommend BUY on the stock at a CMP of Rs. 369 to the target of Rs. 412.

RISKS AND CONCERNS
  • Volatility in International oil prices

  • Dependent on the auto sector

  • De-growth in the construction and housing sector

  • Limited pricing flexibility in the decorative paint segment

  • The volatility of the Indian currency

FINANCIALS

Kansai Nerolac Paints Ltd. key Products/Revenue Segments include

  • Paints which contributed Rs 4326.28 Cr to Sales Value (99.74% of Total Sales)

  • Scrap which contributed Rs 9.70 Cr to Sales Value (0.22% of Total Sales)

  • Other Operating Revenue which contributed Rs 1.23 Cr to Sales Value (0.02% of Total Sales)

for the year ending 31-Mar-2016.

For the quarter ended 30-Jun-2016, the company has reported Standalone sales of Rs. 1044.64 Cr., up 17.61% from last quarter Sales of Rs. 888.20 Cr. and up 4.73% from last year same quarter Sales of Rs. 997.47 Cr. The company has reported a net profit after tax of Rs. 126.50 Cr. in the latest quarter.

Revenue

 

ProductName

2014

2015

2016

 

Sales

% of STO

Sales

% of STO

% of STO

Sales

Paints,Varnish, Enamel&Powde Co

3720.77

99.51

4194.99

99.6

4593.43

99.76

Other Operating Revenue

18.25

0.49

16.65

0.4

10.93

0.24

The trend in Quantity, Value, and cost per unit

Income Statement

2013

2014

2015

2016

2017 E

2018 E

2019 E

2020 E

2021 E

Cr

 

 

 

 

 

 

 

 

 

INCOME :

 

 

 

 

 

 

 

 

 

Sales Turnover

3387.12

3769.04

4251.62

4650.89

5500

6363

7364

8487

9781

Sales Growth

 

11.28%

12.80%

9.39%

18.25%

15.70%

15.73%

15.24%

15.26%

Excise Duty

363.81

404.33

457.5

506.99

593

686

794

915

1055

Net Sales

3023.31

3364.71

3794.12

4143.9

4907

5677

6570

7571

8727

Other Income

132.23

9.79

21.53

560.36

50

50

50

50

50

Stock Adjustments

61.39

80.42

-62.58

12.62

0

0

0

0

0

Total Income

3216.93

3454.92

3753.07

4716.88

4957

5727

6620

7621

8777

 

EXPENDITURE :

 

 

 

 

 

 

 

 

 

Raw Materials

1809.35

2003.85

2072.63

2121.36

2418

2802

3247

3747

4324

Power & Fuel Cost

45.56

66.88

65.41

69.66

85

98

113

131

151

Employee Cost

119.2

138.28

146.24

180.81

200

231

267

308

355

Other Manufacturing Expenses

223.59

250.72

279.57

287.77

338

388

442

509

587

Selling and Administration Expenses

467.96

528.14

616.73

799.18

964

1138

1343

1578

1856

Miscellaneous Expenses

81.35

89.91

99.81

120.2

134

155

179

206

238

Total Expenditure

2747.01

3077.78

3280.39

3578.98

4138

4811

5592

6480

7509

 

 

EBITDA

276.3

286.93

513.73

564.92

769

866

978

1092

1217

Depreciation

47.35

65.52

68.26

68.36

84

97

112

129

149

EBIT

422.57

311.62

404.42

1069.54

736

819

917

1013

1119

Interest

0.68

1.79

0.92

0.54

8

8

9

10

11

PBT

421.89

309.83

403.5

1069

728

811

907

1003

1107

Tax

74.84

78.29

117.83

165.77

160

178

199

220

243

Fringe Benefit Tax

0

0

0

0

0

0

0

0

0

Deferred Tax

53.43

22.88

10.48

8.97

0

0

0

0

0

Net Profit

293.62

208.66

275.19

894.26

568

633

708

783

864

Minority Interest (after tax)

0.48

0.71

1.13

1.02

0

0

0

0

0

Profit/Loss of Associate Company

0

0

0

0

0

0

0

0

0

Extraordinary Items

86.16

1.88

3.47

422.42

0

0

0

0

0

Adjusted Net Profit

206.98

206.07

270.59

470.82

568

633

708

783

864

 

Outstanding Shares

 

 

 

534217650

 

538919720

 

538919720

 

538919720

 

538919720

 

538919720

 

538919720

EPS

52.61

36.85

5.07

8.74

10.55

11.75

13.14

14.52

16.04

 

EBITDA Margin

 

9.14%

 

8.53%

 

13.54%

 

13.63%

 

15.68%

 

15.25%

 

14.89%

 

14.42%

 

13.95%

EBIT Margin

13.98%

9.26%

10.66%

25.81%

14.99%

14.43%

13.95%

13.38%

12.82%

PAT Margin

6.43%

5.96%

7.21%

9.98%

11.47%

11.06%

10.70%

10.27%

9.85%

 

Cons. Balance Sheet

2014

2015

2016

2017E

2018E

2019E

2020E

2021E

cr

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Cash And Short Term Investments

55

34

479

638

972

1342

1742

2176

Total Receivables, Net

468

515

546

656

759

878

1012

1166

Total Inventory

658

555

583

704

814

942

1086

1251

Other current assets, total

64

237

566

487

564

653

752

867

Total current assets

1246

1341

2172

2484

3109

3815

4592

5461

Property, plant & equipment, net

922

916

938

1147

1327

1536

1770

2040

Goodwill, net + Intangibles, net

0

0

0

0

0

0

0

0

other assets

34

60

73

73

73

73

73

73

Total Assets

2202

2318

3183

3705

4509

5425

6436

7574

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

Accounts payable

455

333

412

459

531

615

709

817

short term debt

79

97

207

207

207

207

207

207

other short term liabilities

153

184

230

484

595

723

866

1032

Total current liabilities

687

614

849

1151

1333

1545

1782

2056

Total long term debt

68

51

47

47

47

47

47

47

Other liabilities, total

29

25

17

17

17

17

17

17

Total liabilities

784

691

913

1214

1397

1609

1846

2120

SHAREHOLDERS EQUITY

 

 

 

 

 

 

 

 

Common stock

54

54

54

54

54

54

54

54

Additional paid-in capital

 

 

 

 

 

 

 

 

Retained earnings (accumulated deficit)

1372

1548

2242

2682

3175

3729

4343

5024

Other equity, total

 

 

 

 

 

 

 

 

Total equity

1426

1601

2296

2736

3229

3783

4397

5078

 

 

Total liabilities & shareholders' equity

2202

2318

3183

3705

4509

5425

6436

7574

 

Cash Flow

2015

2016

2017 E

2018 E

2019 E

2020 E

2021 E

cr

 

 

 

 

 

 

 

Cash in the Beginning

55

34

479

638

972

1342

1742

OPERATIONS

 

 

 

 

 

 

 

Net Income

271

471

568

633

708

783

864

Depreciation

68

68

84

97

112

129

149

other charge

141

283

-333

-34

-39

-44

-51

WCC

-272

76

255

111

128

144

166

Total cash from operations

209

899

574

806

909

1011

1128

INVESTING

 

 

 

 

 

 

 

Capital expenditures

-239

146

-287

-332

-384

-443

-510

Other investing and cash flow items, total

0

0

0

0

0

0

0

Total cash from investing

-239

146

-287

-332

-384

-443

-510

FINANCING

 

 

 

 

 

 

 

Financing cash flow items

 

 

 

 

 

 

 

Total cash dividends paid

-59

-75

-108

-120

-134

-148

-164

Issuance (retirement) of stock, net

0

0

0

0

0

0

0

Issuance (retirement) of debt, net

0

0

0

0

0

0

0

other

-27

-20

-20

-20

-20

-20

-20

Total cash from financing

-86

-96

-128

-140

-154

-169

-184

NET CHANGE IN CASH

 

 

 

 

 

 

 

Foreign exchange effects

0

0

0

0

0

0

0

Net change in cash

-116

949

159

334

370

400

434

 

 

Cash in the END

34

479

638

972

1342

1742

2176

 

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DISCLAIMER

This report is only for the information of our customers. Recommendations, opinions, or suggestions are given with the understanding that readers acting on this information assume all risks involved. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. ATS and/or its group companies do not as assume any responsibility or liability resulting from the use of such information.

 

 

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