Best Linking Group Holdings (HKSE:09882) ROC % : 13.60% (As of Jun. 2024)

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What is Best Linking Group Holdings 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 %. Best Linking Group Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 13.60%.

As of today (2024-12-12), Best Linking Group Holdings's WACC % is 2.26%. Best Linking Group Holdings's ROC % is 3.84% (calculated using TTM income statement data). Best Linking Group Holdings generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Best Linking Group Holdings ROC % Historical Data

The historical data trend for Best Linking Group Holdings'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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Best Linking Group Holdings ROC % Chart

Best Linking Group Holdings Annual Data

Trend

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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15.85

26.60

52.49

39.24

21.13

Best Linking Group Holdings Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial															12.19	13.71	59.18	-	13.60

Best Linking Group Holdings ROC % Calculation

Best Linking Group Holdings'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 )
=	26.898 * ( 1 - 21.58% )	/	( (95.677	+	103.996)	/ 2 )
=	21.0934116	/	99.8365
=	21.13 %

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	))
=	149.188	-	2.508	-	( 51.003	-	max(0, 5.544	-	122.766	+	51.003	))
=	95.677

	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	))
=	164.857	-	5.97	-	( 54.891	-	max(0, 17.049	-	139.994	+	54.891	))
=	103.996

Best Linking Group Holdings'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 )
=	16.548 * ( 1 - 14.38% )	/	( (103.996	+	104.389)	/ 2 )
=	14.1683976	/	104.1925
=	13.60 %

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	))
=	164.857	-	5.97	-	( 54.891	-	max(0, 17.049	-	139.994	+	54.891	))
=	103.996

	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	))
=	145.559	-	2.422	-	( 38.748	-	max(0, 5.768	-	123.283	+	38.748	))
=	104.389

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

Best Linking Group Holdings (HKSE:09882) 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, Best Linking Group Holdings's WACC % is 2.26%. Best Linking Group Holdings's ROC % is 3.84% (calculated using TTM income statement data). Best Linking Group Holdings generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

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.

Best Linking Group Holdings ROC % Related Terms

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Best Linking Group Holdings Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » Best Linking Group Holdings Ltd (HKSE:09882) » Definitions » ROC %

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Address

No. 6 Gongye 2nd Cross Road, Tutang 2nd Industrial Zone, Changping, Guangdong, Dongguan, CHN

Website

https://www.blg.hk

Best Linking Group Holdings Ltd is a slewing ring manufacturer in China. These slewing rings have applications in the areas of construction machinery and equipment, wind turbines, military equipment, and robotics. Geographically, it derives a majority of its revenue from Singapore and also has a presence in Malaysia, Hong Kong, Japan, United States, China, Taiwan, Canada, Singapore, Thailand, The Philippines, The PRC, Vietnam and New Zealand. It derives maximum revenue from singapore.

Executives

C Centrum Holdings Limited	2101 Beneficial owner
Chan Yuk Pan	2201 Interest of corporation controlled by you
Leung Tak Yee	2202 Interest of your spouse

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