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Luye Pharma Group (HKSE:02186) ROC % : 8.09% (As of Jun. 2024)


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What is Luye Pharma Group 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 %. Luye Pharma Group's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 8.09%.

As of today (2025-03-02), Luye Pharma Group's WACC % is 8.92%. Luye Pharma Group's ROC % is 5.55% (calculated using TTM income statement data). Luye Pharma Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Luye Pharma Group ROC % Historical Data

The historical data trend for Luye Pharma Group'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.

* Premium members only.

Luye Pharma Group ROC % Chart

Luye Pharma Group Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 9.91 6.04 3.21 4.03 3.70

Luye Pharma Group 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 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.62 -0.25 3.48 3.17 8.09

Luye Pharma Group ROC % Calculation

Luye Pharma Group'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 )
=1125.198 * ( 1 - 23% )/( (23800.921 + 23065.728)/ 2 )
=866.40246/23433.3245
=3.70 %

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))
=27079.913 - 1828.815 - ( 6191.361 - max(0, 10594.499 - 12044.676+6191.361))
=23800.921

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))
=27881.206 - 2009.415 - ( 6679.09 - max(0, 8900.961 - 11707.024+6679.09))
=23065.728

Luye Pharma Group'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 )
=2253.542 * ( 1 - 17.32% )/( (23065.728 + 22996.045)/ 2 )
=1863.2285256/23030.8865
=8.09 %

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))
=27881.206 - 2009.415 - ( 6679.09 - max(0, 8900.961 - 11707.024+6679.09))
=23065.728

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))
=29280.346 - 3311.482 - ( 6976.013 - max(0, 10522.65 - 13495.469+6976.013))
=22996.045

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

* 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.


Luye Pharma Group  (HKSE:02186) 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, Luye Pharma Group's WACC % is 8.92%. Luye Pharma Group's ROC % is 5.55% (calculated using TTM income statement data). Luye Pharma Group 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.


Luye Pharma Group ROC % Related Terms

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Luye Pharma Group Business Description

Traded in Other Exchanges
Address
Hongqiao Road 1438, 22/F, Gubei International Fortune Center II, Changning District, Shanghai, CHN, 264003
Luye Pharma Group Ltd is a China-based drug manufacturer that focuses on development, production, marketing and sale of pharmaceutical products. The company develops drugs related to diagnosing and treating cancer, the cardiovascular system, the alimentary tract, and the central nervous system. The company's highest revenue share comes from oncology drugs, followed by central nervous system drugs. The company develops drugs for world-wide use in Asia, Europe, and the United States. The Group organizes its business segments by type of products. Oncology drugs, Cardiovascular system drugs, Alimentary tract and metabolism drugs and Central nervous system drugs. It derives maximum revenue from the sale of Oncology drugs.
Executives
Ubs Group Ag 2201 Interest of corporation controlled by you
Liu Dianbo 2301 Trustee
Luye Life Sciences Group Ltd 2201 Interest of corporation controlled by you
Luye Pharma Holdings Ltd. 2201 Interest of corporation controlled by you
Luye Pharmaceutical International Co., Ltd.
Luye Pharmaceutical Investment Co., Ltd.
Nelumbo Investments Limited 2201 Interest of corporation controlled by you
Shorea Lbg 2201 Interest of corporation controlled by you
Ginkgo (ptc) Limited 2301 Trustee
Luye Pharmaceutical International Co., Ltd. 2201 Interest of corporation controlled by you
Luye Pharmaceutical Investment Co., Ltd. 2101 Beneficial owner
Yi Fang Da Ji Jin Guan Li You Xian Gong Si 2102 Investment manager
Hillhouse Nev Holdings Limited 2101 Beneficial owner
Hillhouse Investment Management, Ltd. 2102 Investment manager
Hillhouse Fund V, L.p. 2201 Interest of corporation controlled by you

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