ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Permaju Industries Bhd's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was -1.79%.
As of today (2024-06-14), Permaju Industries Bhd's WACC % is 8.40%. Permaju Industries Bhd's ROIC % is -6.80% (calculated using TTM income statement data).
Permaju Industries Bhd earns returns that do not match up to its cost of capital. It will destroy value as it grows.
* 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.
Competitive Comparison of Permaju Industries Bhd's ROIC %
For the Auto & Truck Dealerships subindustry, Permaju Industries Bhd'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.
Permaju Industries Bhd's ROIC % Distribution in the Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Permaju Industries Bhd's ROIC % distribution charts can be found below:
* The bar in red indicates where Permaju Industries Bhd's ROIC % falls into.
Permaju Industries Bhd ROIC % Calculation
Permaju Industries Bhd's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Jun. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (Mar. 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.
Permaju Industries Bhd (XKLS:7080) 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, Permaju Industries Bhd's WACC % is 8.40%. Permaju Industries Bhd's ROIC % is -6.80% (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.
Permaju Industries Bhd ROIC % Related Terms
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Permaju Industries Bhd (XKLS:7080) Business Description
Permaju Industries Bhd is Malaysia-based investment holding firm. The company is engaged in the sales and distribution of automobile vehicles. The company operates in five business segments namely; Timber segment comprises of sale of timber logs and related timber products and holding of timber concession and tree plantation, Automotive comprises of sale and distribution of motor vehicles and provision of related services which also contributes a majorly in revenue, Property segment consists of development and construction of property, EV Division consists of Rental of luxury EV motor vehicles and Other segment involved in group level corporate services and investment holding activity. Majority of its revenue comes from the Malaysian market.
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