ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Solara Active Pharma Sciences's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 6.04%.
As of today (2026-07-10), Solara Active Pharma Sciences's WACC % is 16.76%. Solara Active Pharma Sciences's ROIC % is 4.12% (calculated using TTM income statement data).
Solara Active Pharma Sciences earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Solara Active Pharma Sciences (NSE:SOLARAPP1) 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, Solara Active Pharma Sciences's WACC % is 16.76%. Solara Active Pharma Sciences's ROIC % is 4.12% (calculated using TTM income statement data).
Solara Active Pharma Sciences 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.
Solara Active Pharma Sciences ROIC % Related Terms
Solara Active Pharma Sciences ROIC % Historical 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.
For the Drug Manufacturers - Specialty & Generic subindustry, Solara Active Pharma Sciences'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.
Solara Active Pharma Sciences ROIC % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Solara Active Pharma Sciences's ROIC % distribution charts can be found below:
* The bar in red indicates where Solara Active Pharma Sciences's ROIC % falls into.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* 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.
Solara Active Pharma Sciences (NSE:SOLARAPP1) has a ROIC % of 6.04% as of Mar. 2026. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Solara Active Pharma Sciences and its competitors.
Is Solara Active Pharma Sciences' ROIC % too high?
Solara Active Pharma Sciences' current ROIC % is 6.04%. The Drug Manufacturers industry median ROIC % is 4.50. Solara Active Pharma Sciences' value of 6.04% is 34.4% above this industry median. Overall, Solara Active Pharma Sciences has a GF Score™ of 68/100, reflecting its overall financial health beyond just this single metric.
How does Solara Active Pharma Sciences' ROIC % compare to ZTS and UTHR?
Solara Active Pharma Sciences' ROIC % of 6.04% can be compared against companies in the Drug Manufacturers industry. The industry median ROIC % is 4.50. Solara Active Pharma Sciences' value of 6.04% is 34.4% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROIC % for a Drug Manufacturers company?
The median ROIC % among Drug Manufacturers companies is 4.50, based on 986 companies in the industry. Companies in the top quartile (top 25%) have a ROIC % significantly above this median, while those in the bottom quartile fall well below. However, ROIC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Solara Active Pharma Sciences's current ROIC % of 6.04% is 34.4% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROIC % mean?
A high ROIC % can signal that a stock is expensive relative to its fundamentals. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Solara Active Pharma Sciences and its competitors. For the Drug Manufacturers industry, the median ROIC % is 4.50 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Solara Active Pharma Sciences's current ROIC % is 6.04%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Solara Active Pharma Sciences stock overvalued right now?
Solara Active Pharma Sciences (NSE:SOLARAPP1) has a current ROIC % of 6.04%. The stock's GF Value™ is ₹261.61, compared to a current price of ₹267.45 — trading 2.2% above its estimated fair value. The current ROIC % is 6.04% and 34.4% above the Drug Manufacturers industry median of 4.50. Solara Active Pharma Sciences' overall GF Score™ is 68/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROIC % calculated?
ROIC % is calculated from a company's financial statements. For Solara Active Pharma Sciences (NSE:SOLARAPP1), the current ROIC % is 6.04% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Solara Active Pharma Sciences (NSE:SOLARAPP1) Overvalued in 2026?
Based on GuruFocus' analysis, Solara Active Pharma Sciences stock appears to be overvalued.
The current stock price of ₹267.45 is trading 2.2% above its estimated GF Value™ of ₹261.61.
Key valuation signals for NSE:SOLARAPP1:
ROIC %: 6.04%
GF Value™: ₹261.61 vs. price of ₹267.45 (2.2% above fair value)
Industry Position: 34.4% above the Drug Manufacturers median
No single metric tells the full story. See the NSE:SOLARAPP1 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Solara Active Pharma Sciences Business Description
Solara Active Pharma Sciences Ltd is engaged in the Active Pharmaceutical Ingredients (API) in India. It manufactures and develops APIs and offers services, including CRAMS and contract manufacturing for APIs. The company offers products and services, such as Anaesthetic, Analgesics, Antiviral, Retinoid, Anti-emetic, Antimalarial, Diuretic, Muscle relaxant, Antiallergics, Antihypertensive, Calcimimetic agent, Anti-seizure, Antigout, Cardiovascular, Anti-infective, Cough suppressant, and others. It also offers contract services, including contract development and manufacturing, and analytical services. Geographically, the company generates all of its revenue from India.
68GF Score
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