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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Gujarat Energy's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 2.95%.
As of today (2026-08-08), Gujarat Energy's WACC % is 16.62%. Gujarat Energy's ROC % is 6.13% (calculated using TTM income statement data).
Gujarat Energy earns returns that do not match up to its cost of capital. It will destroy value as it grows.
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, Gujarat Energy's WACC % is 16.62%. Gujarat Energy's ROC % is 6.13% (calculated using TTM income statement data).
Gujarat Energy 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.
Gujarat Energy ROC % Related Terms
Gujarat Energy ROC % Historical Data
* Premium members only.
The historical data trend for Gujarat Energy'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.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* 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.
Gujarat Energy (BOM:539336) has a ROC % of 2.95% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Gujarat Energy and its competitors.
Is Gujarat Energy's ROC % too high?
Gujarat Energy's current ROC % is 2.95%. The Utilities - Regulated industry median ROC % is 4.15. Gujarat Energy's value of 2.95% is 28.9% below this industry median. Overall, Gujarat Energy has a GF Score™ of 83/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Gujarat Energy's ROC % compare to ATO and NI?
Gujarat Energy's ROC % of 2.95% can be compared against companies in the Utilities - Regulated industry. The industry median ROC % is 4.15. Gujarat Energy's value of 2.95% is 28.9% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for an Utilities - Regulated company?
The median ROC % among Utilities - Regulated companies is 4.15, based on 503 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Gujarat Energy's current ROC % of 2.95% is 28.9% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Gujarat Energy and its competitors. For the Utilities - Regulated industry, the median ROC % is 4.15 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Gujarat Energy's current ROC % is 2.95%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Gujarat Energy stock overvalued right now?
Based on GuruFocus' analysis, Gujarat Energy (BOM:539336) is currently considered Possible Value Trap. The stock's GF Value™ is ₹648.55, compared to a current price of ₹266.80 — trading 58.9% below its estimated fair value. The current ROC % is 2.95% and 28.9% below the Utilities - Regulated industry median of 4.15. Gujarat Energy's overall GF Score™ is 83/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For Gujarat Energy (BOM:539336), the current ROC % is 2.95% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Gujarat Energy (BOM:539336) Overvalued in 2026?
Based on GuruFocus' analysis, Gujarat Energy stock appears to be undervalued.
The current stock price of ₹266.80 is trading 58.9% below its estimated GF Value™ of ₹648.55.
GuruFocus considers Gujarat Energy to be Possible Value Trap.
Key valuation signals for BOM:539336:
ROC %: 2.95%
GF Value™: ₹648.55 vs. price of ₹266.80 (58.9% below fair value)
Industry Position: 28.9% below the Utilities - Regulated median
No single metric tells the full story. See the BOM:539336 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Gujarat Energy Ltd, formerly Gujarat Gas Ltd is an India-based gas distribution company. Its activities include sale, purchase, supply, distribution, transport, trading in Natural Gas, Compressed natural gas, Liquefied natural gas, Liquefied petroleum gas, and other gaseous forms. The company transports the gas through pipelines, trucks, trains, or other suitable modes of transportation. It operates in the segment of the natural gas business. All the business activities of the company are carried out in India.
83GF Score
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