Year : Fy16 Fy15 Fy14 13 12 11 10 09 08 07
Fixed Asset Turnover 0.27- 0.18 0.14 0.20 0.29 0.27 0.30 0.40 0.38 0.36
Here is 10 years Fixed asset turnover ratio of this company. As we can see that they have peak of 0.4 times of FAT during high infra spending in economy i.e Fy 07-09, i think we also have to consider pricing power of the company as in Fy09 their capacity utilization was about 87-90% but there was demand from all sectors, while currently they have major demand from wind turbines only so i think they have little less pricing power than those years. That we can even see from their EBITDA margins which was more than 73% , currently which is around 63%.
By Fy2017, their Gross fixed assets will be Rs.2700crs and by Fy18, their fixed assets will be Rs.3000crs with debt of around Rs.600crs. Now if we assume asset turnover of 0.27 it can have turn over of Rs.729 crs and EBITDA of Rs.459 crs with EBITDA of 63% margins. so if infra spend boost up going forward, i think it will have lots of room to improve its margins, if you consider 0.35 of FAT and 70-72% of EBITDA margins.
Correct me if there is any wrong observation.