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Chatha Foods (BOM:544151) ROIC % : 10.26% (As of Sep. 2024)


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What is Chatha Foods ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Chatha Foods's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 10.26%.

As of today (2025-03-15), Chatha Foods's WACC % is 12.41%. Chatha Foods's ROIC % is 11.50% (calculated using TTM income statement data). Chatha Foods earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Chatha Foods ROIC % Historical Data

The historical data trend for Chatha Foods's ROIC % 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.

Chatha Foods ROIC % Chart

Chatha Foods Annual Data
Trend Mar21 Mar22 Mar23 Mar24
ROIC %
-8.80 3.14 8.33 15.70

Chatha Foods Semi-Annual Data
Mar21 Mar22 Mar23 Sep23 Mar24 Sep24
ROIC % Get a 7-Day Free Trial - - 17.48 14.11 10.26

Competitive Comparison of Chatha Foods's ROIC %

For the Packaged Foods subindustry, Chatha Foods's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Chatha Foods's ROIC % Distribution in the Consumer Packaged Goods Industry

For the Consumer Packaged Goods industry and Consumer Defensive sector, Chatha Foods's ROIC % distribution charts can be found below:

* The bar in red indicates where Chatha Foods's ROIC % falls into.



Chatha Foods ROIC % Calculation

Chatha Foods's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2024 is calculated as:

ROIC % (A: Mar. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Mar. 2023 ) + Invested Capital (A: Mar. 2024 ))/ count )
=93.837 * ( 1 - 27.95% )/( (424.691 + 436.784)/ 2 )
=67.6095585/430.7375
=15.70 %

where

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))
=835.076 - 117.017 - ( 281.275 - max(0, 200.015 - 520.425+281.275))
=436.784

Chatha Foods's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2024 is calculated as:

ROIC % (Q: Sep. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2024 ) + Invested Capital (Q: Sep. 2024 ))/ count )
=78.97 * ( 1 - 27.85% )/( (436.784 + 674.116)/ 2 )
=56.976855/555.45
=10.26 %

where

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))
=835.076 - 117.017 - ( 281.275 - max(0, 200.015 - 520.425+281.275))
=436.784

Invested Capital(Q: Sep. 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))
=1051.123 - 135.96 - ( 241.047 - max(0, 359.164 - 618.962+241.047))
=674.116

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


Chatha Foods  (BOM:544151) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Chatha Foods's WACC % is 12.41%. Chatha Foods's ROIC % is 11.50% (calculated using TTM income statement data).


Be Aware

Like ROE % and ROA %, ROIC % 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.


Chatha Foods ROIC % Related Terms

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Chatha Foods Business Description

Traded in Other Exchanges
N/A
Address
Chandigarh - Ambala Highway, Village Chaundheri, Post office Dapper, District Mohali, Mohali, PB, IND, 140501
Chatha Foods Ltd is a frozen food processor, serving top QSRs (Quick Serving Restaurants), CDRs (Casual Dining Restaurants), and other players in the HoReCa (Hotel-Restaurant-Catering) segment. Its product portfolio includes three categories: Non-Vegetarian, Vegetarian, and Plant-Based. Non-Vegetarian: Manufactures and sells non-vegetarian products such as pizza toppings, sandwich fillings, burger patties, snacks, and more to QSR's, CDR's, and other HoReCa segment players. Vegetarian: Manufactures and sells vegetarian products such as pizza toppings, sandwich fillings, burger patties, taco fillings. Plant-Based: It manufactures and sells plant-based products such as plant-based sausages, salami, and pepperoni; Indian snacks like kebabs, tikkas & samosas; plant-based nuggets & burger.

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