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Oriana Power (NSE:ORIANA) ROIC % : 16.88% (As of Mar. 2023)


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What is Oriana Power 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 %. Oriana Power's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2023 was 16.88%.

As of today (2024-05-14), Oriana Power's WACC % is 12.98%. Oriana Power's ROIC % is 16.88% (calculated using TTM income statement data). Oriana Power 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.


Oriana Power ROIC % Historical Data

The historical data trend for Oriana Power'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.

Oriana Power ROIC % Chart

Oriana Power Annual Data
Trend Mar21 Mar22 Mar23
ROIC %
4.87 19.93 16.88

Oriana Power Semi-Annual Data
Mar21 Mar22 Mar23
ROIC % 4.87 19.93 16.88

Competitive Comparison of Oriana Power's ROIC %

For the Utilities - Renewable subindustry, Oriana Power'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.


Oriana Power's ROIC % Distribution in the Utilities - Independent Power Producers Industry

For the Utilities - Independent Power Producers industry and Utilities sector, Oriana Power's ROIC % distribution charts can be found below:

* The bar in red indicates where Oriana Power's ROIC % falls into.



Oriana Power ROIC % Calculation

Oriana Power's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2023 is calculated as:

ROIC % (A: Mar. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Mar. 2022 ) + Invested Capital (A: Mar. 2023 ))/ count )
=188.58 * ( 1 - 30.57% )/( (478.196 + 1072.824)/ 2 )
=130.931094/775.51
=16.88 %

where

Invested Capital(A: Mar. 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))
=754.301 - 263.354 - ( 12.751 - max(0, 369.937 - 413.566+12.751))
=478.196

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))
=1274.86 - 173.569 - ( 28.467 - max(0, 369.344 - 413.311+28.467))
=1072.824

Oriana Power's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2023 is calculated as:

ROIC % (Q: Mar. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2022 ) + Invested Capital (Q: Mar. 2023 ))/ count )
=188.58 * ( 1 - 30.57% )/( (478.196 + 1072.824)/ 2 )
=130.931094/775.51
=16.88 %

where

Invested Capital(Q: Mar. 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))
=754.301 - 263.354 - ( 12.751 - max(0, 369.937 - 413.566+12.751))
=478.196

Invested Capital(Q: 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))
=1274.86 - 173.569 - ( 28.467 - max(0, 369.344 - 413.311+28.467))
=1072.824

Note: The Operating Income data used here is one times the annual (Mar. 2023) 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.


Oriana Power  (NSE:ORIANA) 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, Oriana Power's WACC % is 12.98%. Oriana Power's ROIC % is 16.88% (calculated using TTM income statement data). Oriana Power 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. Oriana Power 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 %, 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.


Oriana Power ROIC % Related Terms

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Oriana Power (NSE:ORIANA) Business Description

Traded in Other Exchanges
N/A
Address
First Floor C-103 Sector-2, Noida Gautam Buddha Nagar, Noida, Ghaziabad, UP, IND, 201301
Oriana Power Ltd is a company that specializes in providing solar energy solutions to industrial and commercial customers. It offers low-carbon energy solutions by installing on-site solar projects such as rooftop and ground-mounted systems, as well as off-site solar farms i.e. Open access. Its business operations are primarily divided into two segments: Capital Expenditure (CAPEX) and Renewable Energy Service Company (RESCO). Under the CAPEX model, it offers Engineering, Procurement, construction, and operation of solar projects. Under CAPEX Model it has delivered projects with a capacity exceeding 100 MWp across various locations across India.

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