Shyam Metalics and Energy (BOM:543299) ROC % : 7.49% (As of Mar. 2024)

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What is Shyam Metalics and Energy 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 %. Shyam Metalics and Energy's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 7.49%.

As of today (2024-06-06), Shyam Metalics and Energy's WACC % is 12.96%. Shyam Metalics and Energy's ROC % is 7.65% (calculated using TTM income statement data). Shyam Metalics and Energy earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Shyam Metalics and Energy ROC % Historical Data

The historical data trend for Shyam Metalics and Energy'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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Shyam Metalics and Energy ROC % Chart

Shyam Metalics and Energy Annual Data

Trend

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Mar24

ROC %

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13.08

19.83

32.72

11.62

10.44

Shyam Metalics and Energy Quarterly Data
	Mar17	Mar18	Mar19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial														3.23	12.64	18.66	4.28	7.49

Shyam Metalics and Energy ROC % Calculation

Shyam Metalics and Energy'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 )
=	9139.8 * ( 1 - -9.49% )	/	( (84858.3	+	106762.5)	/ 2 )
=	10007.16702	/	95810.4
=	10.44 %

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	))
=	111886.8	-	20010.8	-	( 7017.7	-	max(0, 29768.4	-	43012.4	+	7017.7	))
=	84858.3

	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	))
=	144238.3	-	23787	-	( 13688.8	-	max(0, 36729.9	-	50883	+	13688.8	))
=	106762.5

Shyam Metalics and Energy'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: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	12093.2 * ( 1 - 33.9% )	/	( (0	+	106762.5)	/ 1 )
=	7993.6052	/	106762.5
=	7.49 %

where

	Invested Capital		(Q: Dec. 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	))
=	0	-	0	-	( 0	-	max(0, 0	-	0	+	0	))
=	0

	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	))
=	144238.3	-	23787	-	( 13688.8	-	max(0, 36729.9	-	50883	+	13688.8	))
=	106762.5

Note: The Operating Income data used here is four times the quarterly (Mar. 2024) data.

Shyam Metalics and Energy (BOM:543299) 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, Shyam Metalics and Energy's WACC % is 12.96%. Shyam Metalics and Energy's ROC % is 7.65% (calculated using TTM income statement data). Shyam Metalics and Energy 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.

Shyam Metalics and Energy ROC % Related Terms

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Shyam Metalics and Energy (BOM:543299) Business Description

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SHYAMMETL:India

Address

83, Topsia Road, Trinity Tower, 7th Floor, Kolkata, WB, IND, 700046

Website

https://www.shyammetalics.com

Shyam Metalics and Energy Ltd is an integrated metal producer company. It is primarily engaged in the production of long steel products such as iron pellets, sponge iron, steel billets, TMT, structural products, wire rods, and ferro alloys. The company generates the majority of its revenue from India. The group revenue from the Sale of Manufactured Products, Sale of Services, Sale of Traded Goods, and Sale of Power, with the majority being generated from the sale of manufactured products.

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