ZF Steering Gear (India) (BOM:505163) ROC % : -0.79% (As of Dec. 2024)

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What is ZF Steering Gear (India) ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. ZF Steering Gear (India)'s annualized return on capital (ROC %) for the quarter that ended in Dec. 2024 was -0.79%.

As of today (2025-04-04), ZF Steering Gear (India)'s WACC % is 13.47%. ZF Steering Gear (India)'s ROC % is 1.80% (calculated using TTM income statement data). ZF Steering Gear (India) earns returns that do not match up to its cost of capital. It will destroy value as it grows.

ZF Steering Gear (India) ROC % Historical Data

The historical data trend for ZF Steering Gear (India)'s ROC % 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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ZF Steering Gear (India) ROC % Chart

ZF Steering Gear (India) Annual Data

Trend

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Mar24

ROC %

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-0.17

-5.93

1.33

4.59

4.06

ZF Steering Gear (India) Quarterly Data
	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24	Dec24
ROC %	Get a 7-Day Free Trial															0.95	4.36	3.98	0.34	-0.79

ZF Steering Gear (India) ROC % Calculation

ZF Steering Gear (India)'s annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2024 is calculated as:

	ROC % (A: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2023 )	+	Invested Capital (A: Mar. 2024 ))	/ count )
=	242.3 * ( 1 - 15.79% )	/	( (4740.6	+	5319.1)	/ 2 )
=	204.04083	/	5029.85
=	4.06 %

where

	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	))
=	5117.4	-	373.1	-	( 3.7	-	max(0, 839	-	1723.6	+	3.7	))
=	4740.6

	Invested Capital		(A: Mar. 2024 )
=	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	))
=	5940.6	-	452.1	-	( 169.4	-	max(0, 950.3	-	1934.5	+	169.4	))
=	5319.1

ZF Steering Gear (India)'s annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2024 is calculated as:

	ROC % (Q: Dec. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2024 )	+	Invested Capital (Q: Dec. 2024 ))	/ count )
=	-34 * ( 1 - -33.08% )	/	( (5719	+	0)	/ 1 )
=	-45.2472	/	5719
=	-0.79 %

where

	Invested Capital		(Q: Sep. 2024 )
=	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	))
=	6098.5	-	318.7	-	( 60.8	-	max(0, 958.8	-	1827.8	+	60.8	))
=	5719

	Invested Capital		(Q: Dec. 2024 )
=	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. 2024) data.

ZF Steering Gear (India) (BOM:505163) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 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 ROC % 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, ZF Steering Gear (India)'s WACC % is 13.47%. ZF Steering Gear (India)'s ROC % is 1.80% (calculated using TTM income statement data). ZF Steering Gear (India) earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Be Aware

Like ROE % and ROA %, ROC % 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.

ZF Steering Gear (India) ROC % Related Terms

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ZF Steering Gear (India) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » ZF Steering Gear (India) Ltd (BOM:505163) » Definitions » ROC %

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Address

CTS No: 10+10A, Connaught Road, Pride Parmar Galaxy, 3rd Floor, Sadhu Vaswani Chowk, Pune, MH, IND, 411001

Website

http://www.zfindia.com

ZF Steering Gear (India) Ltd produces and assembles steering systems for vehicles, buses, and tractors. The segment in which the group operates includes Auto Component and Renewable Energy. The company's product range includes steering systems, vane pumps, pump pulleys, oil reservoirs, steering and pump mounting brackets, steering columns, intermediate shafts, universal joints, bevel gears boxes, and power steering oil dexron II. ZF Steering operates its business activity through the plant located in Vadu Budruk, Pune. The company generates the majority of its revenue from the Auto component, which is engaged in the manufacturing of auto components.

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