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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 %. Lee & Man Chemical Co's annualized return on capital (ROC %) for the quarter that ended in Dec. 2025 was 6.76%.
As of today (2026-08-13), Lee & Man Chemical Co's WACC % is 9.27%. Lee & Man Chemical Co's ROC % is 8.58% (calculated using TTM income statement data).
Lee & Man Chemical Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Lee & Man Chemical Co (HKSE:00746) 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, Lee & Man Chemical Co's WACC % is 9.27%. Lee & Man Chemical Co's ROC % is 8.58% (calculated using TTM income statement data).
Lee & Man Chemical Co 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.
* 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 two times the semi-annual (Dec. 2025) 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.
Lee & Man Chemical Co (HKSE:00746) has a ROC % of 6.76% as of Dec. 2025. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Lee & Man Chemical Co and its competitors.
Is Lee & Man Chemical Co's ROC % too high?
Lee & Man Chemical Co's current ROC % is 6.76%. The Chemicals industry median ROC % is 4.59. Lee & Man Chemical Co's value of 6.76% is 47.3% above this industry median. Overall, Lee & Man Chemical Co has a GF Score™ of 75/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Lee & Man Chemical Co's ROC % compare to DOW?
Lee & Man Chemical Co's ROC % of 6.76% can be compared against companies in the Chemicals industry. The industry median ROC % is 4.59. Lee & Man Chemical Co's value of 6.76% is 47.3% above 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 a Chemicals company?
The median ROC % among Chemicals companies is 4.59, based on 1,584 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. Lee & Man Chemical Co's current ROC % of 6.76% is 47.3% above 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 Lee & Man Chemical Co and its competitors. For the Chemicals industry, the median ROC % is 4.59 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Lee & Man Chemical Co's current ROC % is 6.76%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Lee & Man Chemical Co stock overvalued right now?
Based on GuruFocus' analysis, Lee & Man Chemical Co (HKSE:00746) is currently considered Modestly Overvalued. The stock's GF Value™ is HK$3.92, compared to a current price of HK$4.70 — trading 19.9% above its estimated fair value. The current ROC % is 6.76% and 47.3% above the Chemicals industry median of 4.59. Lee & Man Chemical Co's overall GF Score™ is 75/100 with 3 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 Lee & Man Chemical Co (HKSE:00746), the current ROC % is 6.76% as of Dec. 2025. 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 Lee & Man Chemical Co (HKSE:00746) Overvalued in 2026?
Based on GuruFocus' analysis, Lee & Man Chemical Co stock appears to be overvalued.
The current stock price of HK$4.70 is trading 19.9% above its estimated GF Value™ of HK$3.92.
GuruFocus considers Lee & Man Chemical Co to be Modestly Overvalued.
Key valuation signals for HKSE:00746:
ROC %: 6.76%
GF Value™: HK$3.92 vs. price of HK$4.70 (19.9% above fair value)
Industry Position: 47.3% above the Chemicals median
No single metric tells the full story. See the HKSE:00746 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Lee & Man Chemical Co Ltd is an investment holding company. The company is engaged in the manufacture and sale of chemical products. Its products include Polymers, Basic Chemicals, Food / Water Additives, Paper Additives, and Lithium Ion Battery Additives. Its segment includes the Chemical segment manufacture and sale of chemical products; and the Property segment engaged in the development and sale of properties, properties held for rental, and supply of related property services. It generates the majority of its revenue from the Chemical segment. Its operations of the two segments are both located in the PRC. Its revenue of the Group's from external customers is derived from the PRC.
75GF Score
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