China Energy Storage Technology Development (HKSE:01143) ROC % : 5.80% (As of Jun. 2024)

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What is China Energy Storage Technology Development 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 %. China Energy Storage Technology Development's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 5.80%.

As of today (2024-12-15), China Energy Storage Technology Development's WACC % is 8.14%. China Energy Storage Technology Development's ROC % is 2.22% (calculated using TTM income statement data). China Energy Storage Technology Development earns returns that do not match up to its cost of capital. It will destroy value as it grows.

China Energy Storage Technology Development ROC % Historical Data

The historical data trend for China Energy Storage Technology Development'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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China Energy Storage Technology Development ROC % Chart

China Energy Storage Technology Development Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-25.32

-22.64

-13.45

-12.12

-0.46

China Energy Storage Technology Development Semi-Annual Data
	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial															-12.82	-10.73	-25.33	6.61	5.80

China Energy Storage Technology Development ROC % Calculation

China Energy Storage Technology Development's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-2.878 * ( 1 - 37.98% )	/	( (354.214	+	414.404)	/ 2 )
=	-1.7849356	/	384.309
=	-0.46 %

where

	Invested Capital		(A: Dec. 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	))
=	659.233	-	52.81	-	( 252.209	-	max(0, 276.303	-	535.398	+	252.209	))
=	354.214

	Invested Capital		(A: 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	))
=	776.418	-	90.447	-	( 271.567	-	max(0, 272.691	-	705.931	+	271.567	))
=	414.404

China Energy Storage Technology Development's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:

	ROC % (Q: Jun. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Jun. 2024 ))	/ count )
=	7.938 * ( 1 - -214.66% )	/	( (414.404	+	446.599)	/ 2 )
=	24.9777108	/	430.5015
=	5.80 %

where

	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	))
=	776.418	-	90.447	-	( 271.567	-	max(0, 272.691	-	705.931	+	271.567	))
=	414.404

	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	))
=	798.098	-	58.454	-	( 293.045	-	max(0, 266.168	-	743.399	+	293.045	))
=	446.599

Note: The Operating Income data used here is two times the semi-annual (Jun. 2024) data.

China Energy Storage Technology Development (HKSE:01143) 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, China Energy Storage Technology Development's WACC % is 8.14%. China Energy Storage Technology Development's ROC % is 2.22% (calculated using TTM income statement data). China Energy Storage Technology Development 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.

China Energy Storage Technology Development ROC % Related Terms

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China Energy Storage Technology Development Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » China Energy Storage Technology Development Ltd (HKSE:01143) » Definitions » ROC %

Traded in Other Exchanges

N/A

Address

The Gateway, Harbour City, Suites 3501 & 3513–14, 35th Floor Tower 6, Tsim Sha Tsui, Hong Kong, HKG

Website

http://www.link-asia.com.hk

China Energy Storage Technology Development Ltd is an investment holding company. It operates in four segments: Electronic manufacturing services; Distribution of Communications Products; Securities and Other Assets Investment, which includes Equity investment, property agency service, and other operations; and Real Estate Supply Chain Services, which provide real estate advisory services and real estate purchase service and Money Lending. The company generates the vast majority of its revenue from the Electronic manufacturing services segment. Its geographical segments are China, the USA, Switzerland, France, Poland, the United Kingdom, and Others. It generates geographic revenue from the USA.

Executives

Chen Dezhu	2201 Interest of corporation controlled by you
Chan Allie	2106 Person having a security interest in shares
Sy Ming Yiu	2101 Beneficial owner
Power Port Holdings Limited	2101 Beneficial owner
Yang Changrong	2201 Interest of corporation controlled by you
He Xiaoming	2201 Interest of corporation controlled by you
Keywan Global Limited	2101 Beneficial owner
Cao Longbing	2201 Interest of corporation controlled by you
Hearts Capital (asia) Limited	2201 Interest of corporation controlled by you
Hearts Capital Spc - Hearts Sp2	2101 Beneficial owner
Long Asia Asset Management (hk) Limited	2102 Investment manager

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