Sonu Infratech (NSE:SONUINFRA) ROC % : 7.88% (As of Mar. 2024)

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What is Sonu Infratech 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 %. Sonu Infratech's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 7.88%.

As of today (2024-12-15), Sonu Infratech's WACC % is 10.23%. Sonu Infratech's ROC % is 7.22% (calculated using TTM income statement data). Sonu Infratech earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Sonu Infratech ROC % Historical Data

The historical data trend for Sonu Infratech'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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Sonu Infratech ROC % Chart

Sonu Infratech Annual Data

Trend

Mar19

Mar20

Mar21

Mar22

Mar23

Mar24

ROC %

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6.51

7.64

6.76

8.53

7.25

Sonu Infratech Semi-Annual Data
	Mar19	Mar20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23	Mar24
ROC %	Get a 7-Day Free Trial				5.27	7.35	8.85	6.68	7.88

Sonu Infratech ROC % Calculation

Sonu Infratech'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 )
=	66.113 * ( 1 - 29.49% )	/	( (629.941	+	656.002)	/ 2 )
=	46.6162763	/	642.9715
=	7.25 %

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	))
=	724.132	-	92.177	-	( 2.014	-	max(0, 383.755	-	515.383	+	2.014	))
=	629.941

	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	))
=	959.892	-	298.811	-	( 5.079	-	max(0, 581.798	-	784.911	+	5.079	))
=	656.002

Sonu Infratech's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	77.786 * ( 1 - 33.79% )	/	( (651.06	+	656.002)	/ 2 )
=	51.5021106	/	653.531
=	7.88 %

where

	Invested Capital		(Q: Sep. 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	))
=	732.72	-	73.74	-	( 7.92	-	max(0, 307.355	-	540.237	+	7.92	))
=	651.06

	Invested Capital		(Q: 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	))
=	959.892	-	298.811	-	( 5.079	-	max(0, 581.798	-	784.911	+	5.079	))
=	656.002

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

Sonu Infratech (NSE:SONUINFRA) 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, Sonu Infratech's WACC % is 10.23%. Sonu Infratech's ROC % is 7.22% (calculated using TTM income statement data). Sonu Infratech 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.

Sonu Infratech ROC % Related Terms

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Sonu Infratech Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » Sonu Infratech Ltd (NSE:SONUINFRA) » Definitions » ROC %

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Address

Platinum 404, Park Colony, Opposite Joggers Park, 4th Floor, Jamnagar, GJ, IND, 361008

Website

https://www.sonuinfratech.com

Sonu Infratech Ltd is engaged in the business of civil construction services, such as piling, excavation, road preparation, land leveling, structural painting, building construction in nature of commercial and industrial projects, and mechanical scaffolding services including structuring and piping. The company operates and generates revenue within India.

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