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WABCO INDIA LTD

Result Update (PARENT BASIS): Q4 FY16

CMP: 5686.00

JUNE 9th, 2016

Overweight

ISIN: INE342J01019

Index Details

SYNOPSIS

Stock Data

Sector
BSE Code
Face Value
52wk. High / Low (Rs.)
Volume (2wk. Avg.)
Market Cap (Rs. in mn.)

Wabco India Limited designs, manufactures and


markets conventional braking products, advanced
braking systems, and other related air assisted
products and systems.

Auto Parts & Equipment


533023
5.00
7449.00/5172.00
579
107852.05

Revenue for the quarter rose by 47.84% to Rs.


5665.19 million from Rs. 3831.97 million, when
compared with the prior year period.

Annual Estimated Results(A*: Actual / E*: Estimated)


YEARS
Net Sales
EBITDA
Net Profit
EPS
P/E

FY16A
18382.71
3275.50
2046.17
107.87
52.71

FY17E
22059.25
4180.49
2750.51
145.01
39.21

FY18E
25368.14
4899.19
3249.97
171.34
33.19

Shareholding Pattern (%)


As on Mar 2016

As on Dec 2015

Promoter

75.00

75.00

Public

25.00

25.00

Others

--

--

1 Year Comparative Graph

During the quarter, EBIDTA is Rs. 907.49 million


as against Rs. 622.64 million in the corresponding
period of the previous year.
During Q4 FY16, the companys net profit jumps to
Rs. 572.86 million from Rs. 303.98 million in the
corresponding quarter ending of previous year, an
increase of 88.45%.
During Q4 FY16, Profit before tax stood at Rs.
759.26 million against Rs. 5000.03 million in Q4
FY15.
EPS of the company stood at Rs. 30.20 during the
quarter, as against Rs. 16.03 per share over previous
year period.
The company has recommended a dividend of Rs.
6/- per share, i.e. 120% for the year ended March
31, 2016.
During the FY2015-16, revenues stood at Rs.
18382.71 million as against Rs. 13479.63 million in
FY2014-15.
PAT was at Rs. 2046.17 million in FY16 as
compared to Rs. 1206.60 million in FY15.

WABCO INDIA LTD

PEER GROUPS
Company Name
Wabco India Ltd
Federal-Mogul Goetze Ltd
Minda Industries Ltd
Amara Raja Batteries Ltd
Document code: FOTL_090620164_4

S&P BSE SENSEX

CMP

Net sales and PAT of the company are expected to


grow at a CAGR of 23% and 29% over 2015 to
2018E respectively.
MARKET CAP EPS

P/E (X) P/BV(X) DIVIDEND

(Rs.)

Rs. in mn.

(Rs.)

Ratio

Ratio

(%)

5686.00
336.40
1190.00
847.50

107852.05
18703.50
18863.90
144106.00

107.87
7.91
50.04
28.65

52.71
42.50
23.76
29.45

10.23
3.78
4.21
6.58

120.00
0.00
70.00
425.00

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

QUARTERLY HIGHLIGHTS (PARENT BASIS)


Results updates- Q4 FY16,
Months

Mar-16

Mar-15

% Change

Revenue

5665.19

3831.97

47.84

Net Profit

572.86

303.98

88.45

EPS

30.20

16.03

88.45

EBIDTA

907.49

622.64

45.75

Revenue for the quarter rose by 47.84% to Rs. 5665.19 million from Rs. 3831.97 million, when compared with the prior
year period. EBIDTA is Rs. 907.49 million as against Rs. 622.64 million in the corresponding period of the previous year.
The companys net profit jumps to Rs. 572.86 million from Rs. 303.98 million in the corresponding quarter ending of
previous year, an increase of 88.45%. Reported earnings per share of the company stood at Rs. 30.20 during the quarter,
as against Rs. 16.03 per share over previous year period.
Break up of Expenditure

Value in Rs. Million


Break up of
Expenditure
Q4 FY16

Q4 FY15

%
Change

Cost of Materials
consumed

3811.15

2224.78

71%

Employee benefits
expenses

466.95

394.03

19%

Depreciation and
amortisation expenses

146.71

120.91

21%

Other expenses

913.22

594.01

54%

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

COMPANY PROFILE
WABCO INDIA LIMITED was established in 1962. The company was formerly known as WABCO-TVS
(INDIA) Limited and changed its name to WABCO India Limited in August 2011. WABCO India Limited is a
subsidiary of WABCO Asia Private Limited. WABCO INDIA designs, manufactures and markets conventional
braking products, advanced braking systems, and other related air assisted products and systems. The company
has grown significantly in the Indian commercial vehicle market. WABCO INDIA serves its aftermarket
customers through a wide national distribution network. With five world-class manufacturing facilities,
software design center and a test track in India, WABCO INDIA excels in engineering and manufacturing.
With its outstanding engineering and manufacturing capabilities and local sourcing network, WABCO INDIA
designs, manufactures and markets conventional braking products, advanced braking systems and other related
air-assisted products and systems, directly serving customers locally and through WABCO internationally.

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

FINANCIAL HIGHLIGHT (PARENT BASIS)

(A*- Actual, E* -Estimations & Rs. In Millions)

Balance Sheet as of March 31, 2015 -2018E


FY15A

FY16A

FY17E

FY18E

94.84

94.84

94.84

94.84

Reserves and Surplus

8535.54

10444.72

13195.23

16445.20

1. Sub Total - Net worth

8630.38

10539.56

13290.07

16540.04

164.52

99.38

69.57

55.65

0.30

0.30

0.32

0.35

187.19

192.47

200.17

210.18

352.01

292.15

270.05

266.18

Trade Payables

1779.00

3463.58

4779.75

5974.69

Other Current Liabilities

233.15

760.61

1133.31

1439.30

Short Term Provisions

140.25

184.68

221.62

252.64

3. Sub Total - Current Liabilities

2152.40

4408.87

6134.67

7666.63

Total Liabilities (1+2+3)

11134.79

15240.58

19694.79

24472.85

3413.70

3732.68

4105.95

4311.25

b) Non-current investments

22.02

22.02

22.24

22.69

c) Long Term Loans and Advances

229.18

342.10

427.63

508.87

3664.90

4096.80

4555.81

4842.80

Current Investments

370.00

2180.00

3876.30

4980.43

Inventories

1179.70

1756.37

2318.41

3268.96

Trade receivables

2991.51

4357.27

6100.18

8418.25

Cash and Bank Balances

2230.51

2130.36

2066.45

2107.78

Short-terms loans & advances

681.26

705.82

762.29

838.51

Other current assets

16.91

13.96

15.36

16.12

2. Sub Total - Current Assets

7469.89

11143.78

15138.98

19630.05

Total Assets (1+2)

11134.79

15240.58

19694.79

24472.85

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

SOURCES OF FUNDS
Shareholder's Funds
Share Capital

Non Current Liabilities


Deferred Tax Liabilities [Net]
Other Long Term Liabilities
Long Term Provisions
2. Sub Total - Non Current Liabilities
Current Liabilities

APPLICATION OF FUNDS
Non-Current Assets
a) Fixed Assets

1. Sub Total - Non Current Assets


Current Assets

Annual Profit & Loss Statement for the period of 2015 to 2018E
Value(Rs.in.mn)

FY15A

FY16A

FY17E

FY18E

Description
Net Sales

12m
13479.63

12m
18382.71

12m
22059.25

12m
25368.14

Other Income

202.99

346.10

432.63

510.50

Total Income

13682.62

18728.81

22491.87

25878.63

Expenditure

-11446.09

-15453.31

-18311.38

-20979.45

2236.53

3275.50

4180.49

4899.19

-3.61

-1.52

-1.60

-1.76

Gross profit

2232.92

3273.98

4178.90

4897.43

Depreciation

-466.64

-562.37

-629.85

-673.94

Profit Before Tax

1766.28

2711.61

3549.04

4223.49

Tax

-559.68

-665.45

-798.53

-973.51

Net Profit

1206.60

2046.17

2750.51

3249.97

94.84

94.84

94.84

94.84

8535.54

10444.72

13195.23

16445.20

Face value

5.00

5.00

5.00

5.00

EPS

63.61

107.87

145.01

171.34

Operating Profit
Interest

Equity capital
Reserves

Quarterly Profit & Loss Statement for the period of 30th Sep, 2015 to 30th June, 2016E
Value(Rs.in.mn)

30-Sep-15

31-Dec-15

31-Mar-16

30-Jun-16E

Description
Net sales

3m
4289.19

3m
4577.97

3m
5665.19

3m
5778.49

Other income

91.79

60.60

102.09

110.26

Total Income

4380.98

4638.57

5767.28

5888.75

Expenditure

-3637.76

-3801.40

-4859.79

-4793.26

743.22

837.17

907.49

1095.49

0.00

0.00

-1.52

-0.03

Gross profit

743.22

837.17

905.97

1095.46

Depreciation

-139.48

-142.03

-146.71

-154.05

Profit Before Tax

603.74

695.14

759.26

941.41

Tax

-120.63

-179.90

-186.40

-284.78

Net Profit

483.11

515.24

572.86

656.64

Equity capital

94.84

94.84

94.84

94.84

Face value

5.00

5.00

5.00

5.00

EPS

25.47

27.16

30.20

34.62

Operating profit
Interest

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

Ratio Analysis
Particulars

FY15A

FY16A

FY17E

FY18E

EPS (Rs.)

63.61

107.87

145.01

171.34

EBITDA Margin (%)

16.59

17.82

18.95

19.31

PBT Margin (%)

13.10

14.75

16.09

16.65

PAT Margin (%)

8.95

11.13

12.47

12.81

P/E Ratio (x)

89.39

52.71

39.21

33.19

ROE (%)

13.98

19.41

20.70

19.65

ROCE (%)

31.32

36.41

36.20

33.69

Debt Equity Ratio

0.00

0.00

0.00

0.00

EV/EBITDA (x)

47.06

31.61

24.38

20.57

Book Value (Rs.)

455.00

555.65

700.66

872.00

P/BV

12.50

10.23

8.12

6.52

Charts

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

OUTLOOK AND CONCLUSION

At the current market price of Rs.5686.00, the stock P/E ratio is at 39.21 x FY17E and 33.19 x FY18E respectively.

Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 145.01 and Rs. 171.34
respectively.

Net sales and PAT of the company are expected to grow at a CAGR of 23% and 29% over 2015 to 2018E
respectively.

On the basis of EV/EBITDA, the stock trades at 24.38 x for FY17E and 20.57 x for FY18E.

Price to Book Value of the stock is expected to be at 8.12 x and 6.52 x for FY17E and FY18E respectively.

Hence, we say that, we are Overweight in this particular scrip for Medium term investment.

INDUSTRY OVERVIEW
The Indian auto-components industry has experienced healthy growth over the last few years. Some of the factors
attributable to this include: a buoyant end-user market, improved consumer sentiment and return of adequate liquidity in
the financial system. The auto-components industry accounts for almost seven per cent of Indias Gross Domestic Product
(GDP) and employs as many as 19 million people, both directly and indirectly. A stable government framework, increased
purchasing power, large domestic market, and an everincreasing development in infrastructure have made India a
favourable destination for investment.
The Indian auto-components industry can be broadly classified into the organised and unorganised sectors. The organised
sector caters to the Original Equipment Manufacturers (OEMs) and consists of high-value precision instruments while the
unorganised sector comprises low-valued products and caters mostly to the aftermarket category. Over the last decade, the
automotive components industry has scaled three times to US$ 40 billion in 2015 while exports have grown even faster to
US$ 11 billion. This has been driven by strong growth in the domestic market and increasing globalisation (including
exports) of several Indian suppliers.
According to the Automotive Component Manufacturers Association of India (ACMA), the Indian auto-components
industry is expected to register a turnover of US$ 100 billion by 2020 backed by strong exports ranging between US$ 80US$ 100 billion by 2026, from the current US$ 11.2 billion.
Outlook
The rapidly globalising world is opening up newer avenues for the transportation industry, especially while it makes a
shift towards electric, electronic and hybrid cars, which are deemed more efficient, safe and reliable modes of

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

transportation. Over the next decade, this will lead to newer verticals and opportunities for auto-component
manufacturers, who would need to adapt to the change via systematic research and development.
The Indian auto-components industry is set to become the third largest in the world by 2025. Indian auto-component
makers are well positioned to benefit from the globalisation of the sector as exports potential could be increased by up to
four times to US$ 40 billion by 2020.

Document code: FOTL_090620164_4

Copyright 2016 Firstobject Technologies Ltd. All rights reserved

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U. Janaki Rao
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(or industry team's) coverage universe, on a risk-adjusted basis, over the next 12-18 months.
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industry team's) coverage universe, on a risk-adjusted basis, over the next 12-18 months.
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