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Yashas Bhat
[email protected]
+91 22 6635 1220
November 16, 2015
Buy S.H.Kelkar &Co. Ltd Industry: Fragrance and Flavor
Industry View: Overweight Initiating Coverage
Proxy FMCG Play
SHK is the largest domestic fragrance manufacturer with ~ 20.5%
market
share in the Indian fragrance industry and exports to over 52
countries. It is
also an emerging flavor producer in India with ~ 2% market share
and exports
reaching 15 countries. SHK has over 4,100 customers which
include leading
national and MNC FMCG companies, blenders and producers of
fragrances
and flavors. Total manufacturing capacity is ~ 19,819 tons p.a.
with 3 plants in
India and 1 in The Netherlands. It has a research team of 18
scientists based in
Mumbai and Barneveld. It also has 12 perfumers, 2 flavorists,
evaluators and
application executives at their 5 creation and development
centers in India,
The Netherlands and Indonesia. Its SHK, Cobra and Keva brands
enjoy
substantial brand equity.
Strong reputation built on quality and continual R & D to
help sustain
market share.
SHK is the 3rd
largest fragrance player in India with a strong reputation built
over 90
years of its existence. With a solid business model, an 8,000
wide product range
and effective sales & marketing capabilities as demonstrated
by its 95 member
robust sales team, we believe that SHK would be able to sustain
its market share in
the ~ 20 bn Indian fragrance industry which in itself has
witnessed a CAGR of
10.1% over the last 4 years.
Low financial risk on account of reduced leverage and no
significant
capex plans.
SHK plans to use ~ 2 bn raised in its IPO to pay off its working
capital loans and
other long term debt. Also, SHK has already completed its capex
cycle for the next
3-5 years with its Indian plants working at 35% - 45% capacity.
Thus we expect that
the repayment of significant debt post issue combined with an
absence of material
capex plans would ensure that financial risk is contained over
the medium term.
Favorable demand side dynamics continue to support the
top-line.
With a growing FMCG sector in Asia, North Africa and Middle East
which constitutes
~ 83.7% of SHKs revenues, favorable demographics in place &
customer diversity
both in terms of low client concentration and ~ 43.5% of
revenues coming from
exports, we expect SHK to be an effective FMCG proxy.
Potential upside offered by branded small packs and flavor
businesses.
SHK plans to deepen its distribution network, introduce new
products and new
application methods for its fragrance small packs business. With
capacity available
in its flavor manufacturing facility, established brand equity
and a growing clientele
currently over 400, we expect SHK to increase its market share
in the flavor industry
which has grown at a CAGR of 10.4% over the last 4 years.
Outlook & Valuation
We believe SHK to be a proxy FMCG play and should trade at
premium valuations
akin to FMCG companies. We initiate coverage on SHK with a BUY
rating and a 15
month price objective of 280 (40% upside)
Stock Data
Current Market Price () 201
Target Price () 280
Potential upside (%) 40
Market Cap ( bn) 29.4
Bloomberg SHKL IN
Reuters NA
Share Holding (Post-Issue)
Fiscal YE
YE Mar FY14 FY15 FY16E FY17E FY18E
Revenues 7,614 8,370 9,375 10,640 12,236
Material Cost 3,991 4,656 5,109 5,852 6,840
Others 2,252 2,521 2,834 3,181 3,579
EBITDA 1,370 1,193 1,431 1,607 1,817
Depreciation 188 293 228 204 187
Other Income 78 233 80 96 109
EBIT 1,261 1,133 1,283 1,499 1,739
Finance Cost 175 186 146 6 5
Tax 294 304 341 448 520
PAT 791 644 796 1,045 1,214
Key Ratios
YE Mar FY14 FY15 FY16E FY17E FY18E
EPS 5.5 4.5 5.5 7.2 8.4
EBITDA Margin 18.0% 14.3% 15.3% 15.1% 15.0%
PAT Margin 10.3% 7.5% 8.4% 9.7% 9.8%
P/E 36.7 45.2 36.5 27.8 23.9
P/B 6.0 5.7 3.7 3.4 3.1
EV/Sales 4.0 3.6 3.0 2.7 2.3
EV/EBITDA 22.3 25.5 19.9 17.6 15.5
ROCE 22.9% 20.6% 16.3% 17.4% 18.5%
ROE 16.4% 12.6% 10.1% 12.2% 13.0%
Promoter & promoter
group 56.7%
Non-institutional
43.3%
http://www.lkpsec.com/
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S.H.Kelkar &Co. Ltd.
LKP Research 2
Company Profile
SHK is the largest domestic fragrance producer commanding ~
20.5% market share
in the Indian fragrance industry with over 9,700 fragrances,
fragrance ingredients
and flavors created, manufactured and supplied as on FY15. It
has a long standing
reputation developed over its 90 year history as a supplier of
quality fragrances for
use by FMCG companies in personal and home care products, food
and beverage
industries with exports to over 52 countries. It is also an
emerging flavor producer in
India with exports of its flavor products reaching 15 countries.
SHK has a large and
diverse mix of over 4,100 customers which include leading
national and MNC FMCG
companies, blenders as well as producers of fragrances and
flavors. It has 4
manufacturing facilities, 3 of which are located in India and 1
in The Netherlands, the
total annual installed manufacturing capacity being ~ 19,819
tons. It has a dedicated
research team of 18 scientists operating out of their facilities
located in Mumbai and
Barneveld. It also has a team of 12 perfumers, 2 flavorists,
evaluators and
application executives at their 5 creation and development
centers in Mumbai,
Bengaluru, The Netherlands and Indonesia. The SHK, Keva and
Cobra brands
through which it sells its products enjoy substantial brand
equity in India.
Brands of SHK
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S.H.Kelkar &Co. Ltd
LKP Research 3
Proven track record, continual
introduction of new fragrances, high
product quality standards to help
SHK sustain its market share
Inelastic demand, high switching
costs and a diversified customer
base to support top-line
Investment Argument
Strong reputation built on high quality standards and continual
R & D
to help sustain market share.
SHK is the 3rd
largest fragrance company in India by revenue, with a market
share of
~ 20.5%. Its competitors are mainly MNCs such as Givaudan SA,
Firmenich,
International Flavors and Fragrances Inc. and Symrise SA which
collectively hold a
57.0% market share of the global fragrance and flavor
industry.
Market Share of fragrance industry players in India.
Source:Company, LKP Research
SHK has always pushed its boundaries with new unique offerings
to help enhance
user experience of FMCG products containing these fragrances. In
FY15 itself, SHK
developed over 502 new fragrance and flavor compounds which have
been sold
commercially. Its research team developed 12 molecules over the
last 3 years, out
of which it has filed patent applications for 3. It combines its
innovation efforts with a
strong quality control system which enables traceability and
repeatability for each
batch of its products. This has led to a contribution of ~ 14.3%
of revenues in FY15
from product launches of the last 3 financial years.
We believe that SHK has built a very strong reputation through
delivery of quality
products and customer satisfaction in the 90 years of its
existence. With a solid
business model, an 8,000 wide fragrance product range and strong
sales &
marketing capabilities as demonstrated by its robust sales team
of 95 people from 9
centers in India and overseas, we believe that SHK would be able
to sustain its
market share in the ~ 20 bn Indian fragrance industry which in
itself has witnessed
a CAGR of 10.1% over the last 4 years.
Favorable demand side dynamics continue to support the
top-line.
The fragrance industry is primarily a niche market. Customers
majorly include
FMCG players who mainly use these fragrances in the manufacture
of demand
inelastic daily utilities like home and personal care products.
This $ 47.3 bn Indian
FMCG industry which has witnessed a CAGR of ~ 13.0% from FY07 to
FY15 is
expected to continue its stable growth phase on account of a
large consumer base,
shift of households to a more aspirational lifestyle and a clear
uptrend in the share of
non-food expenditure in India because of rising income levels.
This coupled with
demand inelasticity is expected to drive demand in the Indian
fragrance industry.
Givaudan 26%
Firmenich 21%
SHK 21%
Symrise 10%
IFF 7%
Others 15%
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S.H.Kelkar &Co. Ltd
LKP Research 4
Demand Drivers in Indian fragrance industry.
Source:Company, LKP Research
Fragrance manufacturers are involved from an early stage of
product development
and there is a requirement for consistency in its smell and
quality. Most FMCG
companies depend on the reliability & quality of service of
fragrance producers and
their knowledge & understanding of their products and needs.
In addition to this,
fragrance procurement has a relatively small share in overall
production costs for
FMCG goods. Thus, there is an element of customer stickiness on
account of these
factors which helps fragrance producers in long term client
retention.
Notable Clients of SHK for fragrance offerings
SHKs fragrance business has a diversified customer base of over
3,700 customers
consisting of leading national and MNC FMCG companies, blenders
as well as
producers of fragrances. A distinct advantage it enjoys is low
customer
concentration. Out of the net revenue from operations of ~ 8.4
bn and ~ 2.2 bn in
FY15 and Q1FY16E, revenue from SHKs largest customer was ~ 240
Mn and ~
88 Mn respectively. This amounts to only ~ 2.9% and ~ 3.9% of
revenues from
SHKs biggest customer in FY15 and Q1FY16E. Thus, with a low
concentration risk,
SHK has managed to effectively mitigate the adverse effect of
client loss on its top-
line and bottom-line.
Revenues from exports form a significant part of SHKs top-line.
Its revenues are
majorly driven by FMCG and fragrance consumption in emerging
markets
comprising of Asia, Middle East and North Africa (A &
MENA).
Home Care 21%
Personal Wash 15%
Fabric Care 11% Beauty Care
11%
Hair Care 11%
Others 31%
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S.H.Kelkar &Co. Ltd.
LKP Research 5
FY15 - Domestic and Exports Revenues FY15 - Share of A &
MENA in Revenues
Source: Company, LKP Research
Q1FY16E -Domestic and Exports Revenues Q1FY16E- Share of A &
MENA in Revenues
Source: Company, LKP Research
Low financial leverage and sufficient
capacity for the medium term to keep
financial risks subdued
Thus, with a growing FMCG sector in India and other emerging
markets, favorable
demographics in place as well as customer diversity both in
terms of low client
concentration and significant exports, we expect SHK to be an
effective FMCG
proxy. We believe that the top-line of SHK will continue
expanding at a considerable
pace which in turn may augment profitability.
Low financial risk on account of reduced leverage and no
significant
medium term capex plans.
Out of the ~ 5 bn IPO issue in Oct 15, ~ 3 bn was towards a
partial exit by
Blackstone Capital and the remaining ~ 2 bn is to be used to
retire working capital
loan and other debt of SHK and its subsidiary KV Arochem. With
negligible debt and
consequent low interest burden, SHK would enjoy the benefits of
reduced financial
risks and low leverage. This would help the company sustain its
high growth phase
where its bottom-line has grown at a CAGR of 15.4% from FY11 to
FY15.
Details of manufacturing plants of SHK
Location Annual Capacity (tons) Utilisation (%)
Raigad, Maharashtra 10,342 44.2%
Mumbai, Maharashtra 4,599 40.5%
Vapi, Gujarat 2,064 35.8%
Barnveld, The Netherlands 1,650 (metric) 77.2%
Domestic ( 4.7 Bn )
56.5%
Overseas ( 3.7 Bn)
43.5%
A & MENA ( 7.0 Bn)
83.7%
Others ( 1.4 Bn)
16.3%
Domestic ( 1.4 Bn )
64.1%
Overseas ( 0.8 Bn )
35.9%
A & MENA ( 1.9 Bn)
85.9%
Others ( 0.3 Bn)
14.1%
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S.H.Kelkar &Co. Ltd
LKP Research 6
Branded small packs provides a
steady stream of cash flows
independent from FMCG industry,
flavor business is largely untapped
The company has 4 fragrance manufacturing facilities, 3 in India
and 1 in The
Netherlands. The manufacturing facilities in India are working
at a 35-45% capacity
as SHK has already completed its capex cycle for the next 3-5
years and is looking
to achieve economies of scale with increased demand and
production. Thus the
repayment of significant long term debt post issue combined with
an absence of
material capex plans would ensure that financial risk is
contained over the medium
term, further cementing the case of SHK as an effective FMCG
proxy.
Potential upside offered by branded small packs and flavor
businesses.
SHK also has a small pack fragrance business which it operates
through its Cobra
brand. This business includes sales of its fragrance products in
package sizes
ranging from 25 gm to 25 kg to several hundred traders and
resellers spread
country-wide. The contribution of this business to the top-line
is given below.
Pack Size
FY15 Q1FY16E
mn % of Revenues mn % of Revenues
25 gm - 500 gm 512 6.1 183 8.3
500 gm- 25 kg 630 7.5 150 6.8
Total 1,142 13.6 333 15.1
Recognizing the potential of this revenue stream, SHK aims to
deepen its
distribution network and introduce a new sales strategy which
would include a
dedicated small pack sales team. With plans to introduce new
products and new
application methods for its fragrance products in the small
packs business, we
expect the Cobra brand to grow and support its top-line
growth.
Snapshot of Indian Flavor Industry.
Demand Drivers in Indian flavor industry Share of market players
in Indian flavor industry.
Source:Company, LKP Research
SHK is also an emerging player in the flavor industry with
exports of this business
reaching over 15 countries. With a diverse portfolio of 1,100
flavor products, this
business has over 400 customers including manufacturers of
beverages,
confectionary, dairy products, bakery products, pharmaceuticals,
oral hygiene, etc.
It manufactures these products in its Raigad facility, details
of which are stated
below.
Facility Installed Capacity Capacity Utilisation
FY15 Q1FY16E
Raigad, Maharashtra 1,164 34% 31%
Beverages 41%
Bakery 23%
Oral Hygiene
12%
Others 24%
IFF 21%
Givaudan 19%
Symrise 10%
Firmenich 6%
SHK 2%
Others 42%
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S.H.Kelkar &Co. Ltd
LKP Research 7
Notable Clients of SHK for flavor offerings
SHK has a small 2% share in the Indian flavor industry which is
dominated by global
leaders. With capacity available with SHK to take advantage of
an industry growing
at a stable CAGR of 10.4% over the last 4 years, established
brand equity with its
fragrance and flavor products and a growing clientele of its
flavor products currently
over 400, we expect SHK to increase its market share in an
expanding industry
thereby further augmenting its growth.
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S.H.Kelkar &Co. Ltd.
LKP Research 8
FMCG growth, continual R & D,
increased focus in flavor and small
pack businesses to drive revenues.
Financial Performance
Revenues
Revenues of SHK have grown at a healthy CAGR of ~ 13.0% from ~
4.7 bn in
FY11 to ~ 8.6 bn in FY15 driven by consistent demand for its
fragrances from
FMCG companies in India and overseas where it has a significant
exposure in A &
MENA.
Revenues ( mn).
Source:Company, LKP Research
Efficient raw material sourcing
essential to maintain and improve
EBITDA margins
The fortunes of SHK depend of the level of FMCG consumption in
India and
overseas. With average household incomes of SHKs target market
expected to
significantly expand with an increasing share of disposable
income, a favorable
population composition and expansion of modern retail formats,
consumption of
FMCG products is all set to follow a healthy growth
trajectory.
Also, in order to keep up with changing preferences of the
ultimate consumer, SHK
consistently invests in research and development. It spent ~ 264
mn and ~ 62mn
in FY15 and Q1FY16E which comes to ~ 3.1% and ~ 2.8% of revenues
respectively.
We believe that a scenario of a thriving FMCG industry,
continual innovation,
introduction of new products, increased focus on developing its
flavor and small
pack fragrance businesses would benefit SHK and help its
revenues grow at ~
13.5% to ~ 10.7 bn in FY17E and ~ 15.0% to ~ 12.3 bn in FY18E
respectively.
EBITDA and EBITDA Margins
SHK has been delivering decent EBITDA margins consistently from
FY11 to FY15. It
witnessed a fall in margins from ~ 18.0% in FY14 to ~ 14.3% in
FY15 primarily
because of increased material cost which went up from ~ 52.4% of
operational
revenues in FY14 to ~ 55.6% in FY15. It sources ~ 40%-45% of raw
materials from
countries like Indonesia, Germany, Brazil and US.
EBITDA ( mn).and EBITDA Margins (%)
Source:Company, LKP Research
4,670
5,740 6,677
7,692 8,603
9,455
10,736
12,345
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
838 1,044 1,180 1,370 1,193 1,431 1,607 1,817
18.2% 18.3% 17.7% 18.0%
14.3% 15.3% 15.1% 15.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
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S.H.Kelkar &Co. Ltd
LKP Research 9
Lower depreciation and negligible
interest burden FY17E onwards to
bolster PAT and PAT margins
Given the nature of fragrance and flavor industry, quality and
specifications of raw
materials used in its products is of high importance. With long
standing relationships
with its suppliers, we believe that SHK can economically source
its raw materials.
Efficient material costs coupled with effective control of
employee benefits and other
expenses are essential for SHKs sustainability in its margins.
We expect that SHK
would earn absolute EBITDA and margins of ~ 1.6 bn and ~ 15.1%
in FY16E and
~ 1.8 bn and ~ 15.0% in FY17E respectively.
PAT and PAT Margins
PAT and PAT margins for SHK stood at ~ 791 mn & ~ 10.3% in
FY14 and ~ 644
mn & ~ 7.5% in FY15 respectively. This is the direct effect
of an increased burden of
higher material costs and depreciation post significant
investments in fixed assets up
to FY14. With SHKs capex cycle completed for the medium term and
negligible
interest burden after repayment of debt post issue, we expect
PAT and PAT margins
to steadily improve to ~ 1.0 bn & ~ 9.7% in FY17E and ~ 1.2
bn & ~ 9.8% in
FY18E respectively.
PAT ( mn).and PAT Margins (%)
Source:Company, LKP Research
Peer Group Analysis
SHK has no real domestic peer as the Indian fragrance and flavor
industry is
dominated by a few global players like Givaudan SA, Firmenich,
Symrise SA, IFF
etc. Comparative price ratios of SHK with its global peers are
given below.
Particulars SHK Givaudan Symrise
Country India Switzerland Germany
Bloomberg SHKL IN GIVN:VX SY1:GR
P/E 36.1 31.6 35.7
P/S 3.4 3.8 3.1
P/B 3.7 4.9 5.2
315 412 616 791 644 796 1,045 1,214
6.7% 7.2%
9.2%
10.3%
7.5%
8.4%
9.7% 9.8%
0%
2%
4%
6%
8%
10%
12%
0
200
400
600
800
1,000
1,200
1,400
FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
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S.H.Kelkar &Co. Ltd.
LKP Research 10
Risks & Concerns
Most fragrance and flavor companies are now placing greater
focus on emerging markets of Asia- Pacific, South America, Middle
East and Africa due
to growing urbanization and changing lifestyles which is
expected to directly
benefit FMCG companies and their fragrance & flavor
suppliers. A trend of
increasing consolidation is also being witnessed in these
emerging economies
with local established players being viewed as attractive
acquisition targets.
This is leading to intense competition in these markets which
can adversely
affect companies like SHK, with global players equipped with
financial strength
and international expertise. This can be witnessed by the fact
that Givaudan SA
has planned to invest FF 55 mn ( 3.7 bn) in a new manufacturing
facility in
Pune, Maharashtra which is expected to be operational by
FY18E.
SHK earns its revenues primarily from the FMCG sector. Thus, the
fortunes of SHK are tied to the prospects of this industry inspite
of SHK enjoying a low
customer concentration. With events like the Nestle Maggi
controversy having
the potential to shake up entire product categories across the
FMCG industry,
this dependency may play out against SHK, especially where it is
looking at its
flavor industry to give impetus to its growth prospects.
SHK has 12 perfumers, 2 flavorists and 17 skilled equipment
operators. The company depends on a few specialized employees,
which may be poached by
its global counterparts, with better remuneration and the MNC
appeal. SHKs
failure to acquire and retain right talent may adversely affect
product
consistency, quality and its ability to introduce new fragrances
and flavors.
~ 43.5% of its revenues come from exports, and ~ 40.0%-45.0% of
raw materials have been from suppliers outside India, exposing the
company to
significant forex risks.
Outlook & Valuation
We believe SHK to be a proxy FMCG play and should trade at
premium valuations
akin to FMCG companies. We initiate coverage on SHK with a BUY
rating and a 15
month price objective of 280 (40% upside)
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S.H.Kelkar &Co. Ltd.
LKP Research 11
Financials (consolidated)
Income statement
YE Mar ( Mn) FY14 FY15 FY16E FY17E FY18E
Net Revenues 7,614 8,370 9,375 10,640 12,236
Total Materials Cost 3,991 4,656 5,109 5,852 6,840
Employee Benefits 1,029 1,150 1,288 1,436 1,597
Others 1,222 1,371 1,547 1,745 1,982
EBITDA 1,370 1,193 1,431 1,607 1,817
EBITDA Margin (%) 18.0% 14.3% 15.3% 15.1% 14.9%
Depreciation 188 293 228 204 187
Other Income 78 233 80 96 109
EBIT 1,261 1,133 1,283 1,499 1,739
EBIT Margin (%) 16.4% 13.2% 13.6% 14.0% 14.1%
Finance Cost 175 186 146 6 5
PBT 1,085 947 1,138 1,493 1,735
PBT Margin (%) 14.1% 11.0% 12.0% 13.9% 14.1%
Tax 294 304 341 448 520
PAT 791 644 796 1,045 1,214
PAT Margin (%) 10.3% 7.5% 8.4% 9.7% 9.8%
Diluted EPS 5.5 4.5 5.5 7.2 8.4
Cash Flow
YE Mar ( Mn) FY14 FY15 FY16E FY17E FY18E
PBT 1,085 947 1,138 1,493 1,735
Depreciation 188 293 228 204 187
Finance Cost 175 186 146 6 5
Other income (78) (233) (80) (96) (109)
Change in Working Capital 105 6 (2,438) (671) (700)
Less: Tax (294) (304) (341) (448) (520)
CF from Operations (a) 1,181 896 (1,348) 488 597
Capital Expenditure (548) (169) (107) (125) (125)
Goodwill on Consolidation (121) 48 - - -
Change in /Investments 412 2 (25) (25) -
Other income 78 233 80 96 109
CF from Investing (b) (179) 114 (52) (54) (17)
Free Cash Flow (a+b) 1,002 1,009 (1,400) 434 580
Issue of Equity Shares - - 2,100 - -
Long Term Debt 214 (298) (361) (6) (6)
Interest paid (175) (186) (146) (6) (5)
Amalgamation adjustment (782) - - - -
Payment of Dividend (150) (149) (187) (260) (361)
DDT (25) (31) (37) (52) (72)
CF from Financing (c) (919) (664) 1,369 (324) (444)
Net Change (a+b+c) 83 345 (31) 110 136
Closing Cash and CE 414 760 729 839 975
Source: Company, LKP Research
Balance sheet
YE Mar ( Mn) FY14 FY15 FY16E FY17E FY18E
SOURCES OF FUNDS
Equity Share Capital 132 1,323 1,446 1,446 1,446
Preference Share Capital 9 92 - - -
Reserves and Surplus 4,669 3,688 6,402 7,135 7,917
Total Net Worth 4,810 5,103 7,848 8,582 9,363
Total Long Term Debt 689 391 29 23 17
Total Liabilities 5,499 5,493 7,877 8,605 9,380
APPLICATION OF FUNDS
Fixed Asset 2,189 2,065 1,944 1,865 1,804
Goodwill on consolidation 828 780 780 780 780
Investments 2 0 25 50 50
Others 213 286 329 353 373
Current Assets
Cash and Bank 414 760 729 839 975
Inventories 2,788 3,175 3,552 4,050 4,705
Sundry Debtors 1,794 1,947 2,183 2,478 2,850
Loans & Advances 283 233 322 376 425
Others 4 42 51 45 41
Current Liabilities and Provisions
Trade Payables 879 1,016 1,127 1,277 1,518
Short Term Borrowings 1,149 1,745 61 13 -
Other Current Liabilities 739 738 558 572 628
Provisions 249 296 292 370 476
Net Current Assets 2,267 2,362 4,799 5,556 6,373
Total Assets 5,499 5,493 7,877 8,605 9,380
Key Ratios
YE Mar FY14 FY15 FY16E FY17E FY18E
Per Share Data (Rs)
EPS 5.5 4.5 5.5 7.2 8.4
CEPS 6.8 6.5 7.1 8.6 9.7
BVPS 33.3 35.3 54.3 59.3 64.7
DPS 1.0 1.0 1.3 1.8 2.5
Growth Ratios(%)
Revenues from operations 14.3% 9.9% 12.0% 13.5% 15.0%
EBITDA 16.1% -12.9% 19.9% 12.3% 13.1%
PAT 28.5% -18.6% 23.7% 31.2% 16.2%
Valuation Ratios (X)
P/E 36.7 45.2 36.5 27.8 23.9
P/CEPS 29.7 31.0 28.4 23.3 20.8
P/B 6.0 5.7 3.7 3.4 3.1
EV/Sales 4.0 3.6 3.0 2.7 2.3
EV/EBITDA 22.3 25.5 19.9 17.6 15.5
FCF/EBITDA 0.7 0.8 (1.0) 0.3 0.3
Profitability Ratios (%)
ROCE 22.9% 20.6% 16.3% 17.4% 18.5%
ROE 16.4% 12.6% 10.1% 12.2% 13.0%
Dividend payout 19.0% 23.2% 23.4% 24.8% 29.7%
Dividend Yield 0.5% 0.5% 0.6% 0.9% 1.2%
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S.H.Kelkar &Co. Ltd.
LKP Securites Ltd, 13th Floor, Raheja Center, Free Press Road,
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