Dhampur Bio Organics (BOM:543593) ROC % : -3.48% (As of Sep. 2024)

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What is Dhampur Bio Organics 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 %. Dhampur Bio Organics's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was -3.48%.

As of today (2024-12-12), Dhampur Bio Organics's WACC % is 10.80%. Dhampur Bio Organics's ROC % is 2.91% (calculated using TTM income statement data). Dhampur Bio Organics earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Dhampur Bio Organics ROC % Historical Data

The historical data trend for Dhampur Bio Organics'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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Dhampur Bio Organics ROC % Chart

Dhampur Bio Organics Annual Data

Trend

Mar21

Mar22

Mar23

Mar24

ROC %

8.20

7.98

3.37

Dhampur Bio Organics Quarterly Data
	Mar21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial									0.34	-4.08	9.89	0.66	-3.48

Dhampur Bio Organics ROC % Calculation

Dhampur Bio Organics'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 )
=	924.4 * ( 1 - 29.01% )	/	( (17731.5	+	21216.1)	/ 2 )
=	656.23156	/	19473.8
=	3.37 %

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	))
=	20774.6	-	2002.6	-	( 1040.5	-	max(0, 8589.6	-	11248.7	+	1040.5	))
=	17731.5

	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	))
=	23128.1	-	1618.1	-	( 293.9	-	max(0, 10520	-	12515.6	+	293.9	))
=	21216.1

Dhampur Bio Organics's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2024 is calculated as:

	ROC % (Q: Sep. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2024 )	+	Invested Capital (Q: Sep. 2024 ))	/ count )
=	-842.4 * ( 1 - 34.06% )	/	( (0	+	15981.5)	/ 1 )
=	-555.47856	/	15981.5
=	-3.48 %

where

	Invested Capital		(Q: Jun. 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

	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	))
=	16693.6	-	372.2	-	( 339.9	-	max(0, 4537.7	-	5332.4	+	339.9	))
=	15981.5

Note: The Operating Income data used here is four times the quarterly (Sep. 2024) data.

Dhampur Bio Organics (BOM:543593) 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, Dhampur Bio Organics's WACC % is 10.80%. Dhampur Bio Organics's ROC % is 2.91% (calculated using TTM income statement data). Dhampur Bio Organics 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.

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Dhampur Bio Organics Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Dhampur Bio Organics Ltd (BOM:543593) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

DBOL:India

Address

Okhla Industrial Estate, Second Floor, Plot No. 201, Phase-III, New Delhi, IND, 110020

Website

https://www.dhampur.com

Dhampur Bio Organics Ltd is an integrated sugarcane processing company in India. It manufactures refined and raw sugar, bio-fuels, biomass-based renewable power, and other related products. The company has three business segments: Sugar which consists of manufacture and sale of Sugar and its byproducts along with co-genration and sale of power; Bio Fuels & Spirits which consists of manufacture and sale of SDS, ENA, Ethanol, sanitizer etc; and Country Liquor. It generates maximum revenue from the sugar segment.

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