Bhatia Communications & Retail (India) (BOM:540956) ROIC % : 12.33% (As of Dec. 2023)

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What is Bhatia Communications & Retail (India) ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Bhatia Communications & Retail (India)'s annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was 12.33%.

As of today (2024-04-26), Bhatia Communications & Retail (India)'s WACC % is 3.37%. Bhatia Communications & Retail (India)'s ROIC % is -22.11% (calculated using TTM income statement data). Bhatia Communications & Retail (India) earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Bhatia Communications & Retail (India) ROIC % Historical Data

The historical data trend for Bhatia Communications & Retail (India)'s ROIC % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Bhatia Communications & Retail (India) ROIC % Chart

Bhatia Communications & Retail (India) Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

ROIC %

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-16.62

-16.70

-13.32

-11.67

-18.60

Bhatia Communications & Retail (India) Quarterly Data
	Mar18	Sep18	Mar19	Sep19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROIC %	Get a 7-Day Free Trial															9.87	-94.24	-4.40	-9.88	12.33

Competitive Comparison of Bhatia Communications & Retail (India)'s ROIC %

For the Electronics & Computer Distribution subindustry, Bhatia Communications & Retail (India)'s ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Bhatia Communications & Retail (India)'s ROIC % Distribution in the Hardware Industry

For the Hardware industry and Technology sector, Bhatia Communications & Retail (India)'s ROIC % distribution charts can be found below:

* The bar in red indicates where Bhatia Communications & Retail (India)'s ROIC % falls into.

Bhatia Communications & Retail (India) ROIC % Calculation

Bhatia Communications & Retail (India)'s annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2023 is calculated as:

	ROIC % (A: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2022 )	+	Invested Capital (A: Mar. 2023 ))	/ count )
=	-176.682 * ( 1 - 25% )	/	( (682.085	+	742.553)	/ 2 )
=	-132.5115	/	712.319
=	-18.60 %

where

	Invested Capital		(A: Mar. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	824.388	-	124.024	-	( 18.279	-	max(0, 278.99	-	537.759	+	18.279	))
=	682.085

	Invested Capital		(A: Mar. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	949.307	-	97.635	-	( 109.119	-	max(0, 311.073	-	672.673	+	109.119	))
=	742.553

Bhatia Communications & Retail (India)'s annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROIC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	146.504 * ( 1 - 25.22% )	/	( (888.304	+	0)	/ 1 )
=	109.5556912	/	888.304
=	12.33 %

where

	Invested Capital		(Q: Sep. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	1085.085	-	83.044	-	( 113.737	-	max(0, 348.134	-	779.794	+	113.737	))
=	888.304

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	0	-	0	-	( 0	-	max(0, 0	-	0	+	0	))
=	0

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Bhatia Communications & Retail (India) (BOM:540956) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.

There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.

Why is ROIC % important?

Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.

As of today, Bhatia Communications & Retail (India)'s WACC % is 3.37%. Bhatia Communications & Retail (India)'s ROIC % is -22.11% (calculated using TTM income statement data).

Be Aware

Like ROE % and ROA %, ROIC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Bhatia Communications & Retail (India) ROIC % Related Terms

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Bhatia Communications & Retail (India) (BOM:540956) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Bhatia Communications & Retail (India) Ltd (BOM:540956) » Definitions » ROIC %

Comparable Companies

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Address

Ring Road, 132, Dr. Ambedkar Shopping Centre, Surat, GJ, IND, 395002

Website

https://www.bhatiamobile.com

Bhatia Communications & Retail (India) Ltd is the distributor of mobile handsets and accessories. The firm is engaged in the retail and wholesale distribution of mobile handsets, tablets, data cards and mobile accessories through retail and franchised stores. The business segment includes: It is a growth-oriented company selling multi-product brands that also operates under stores and sells electronic appliances such as television, refrigerators, air conditioners, coolers, washing machines, and microwaves. Bhatia Communications markets and sells its product under the brands: Apple iPhone, Samsung, OPPO, VIVO, etc. Substantial revenue accrues from owned retail stores. It also offers technical expertise and guide to customers to buy the right product as per their needs.

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