ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. PT Indonesia Pondasi Raya Tbk's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was 1.94%.
As of today (2024-05-28), PT Indonesia Pondasi Raya Tbk's WACC % is 6.41%. PT Indonesia Pondasi Raya Tbk's ROIC % is 6.79% (calculated using TTM income statement data).
PT Indonesia Pondasi Raya Tbk 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.
PT Indonesia Pondasi Raya Tbk 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.
Competitive Comparison of PT Indonesia Pondasi Raya Tbk's ROIC %
For the Engineering & Construction subindustry, PT Indonesia Pondasi Raya Tbk'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.
PT Indonesia Pondasi Raya Tbk's ROIC % Distribution in the Construction Industry
For the Construction industry and Industrials sector, PT Indonesia Pondasi Raya Tbk's ROIC % distribution charts can be found below:
* The bar in red indicates where PT Indonesia Pondasi Raya Tbk's ROIC % falls into.
PT Indonesia Pondasi Raya Tbk ROIC % Calculation
PT Indonesia Pondasi Raya Tbk's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 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.
PT Indonesia Pondasi Raya Tbk (ISX:IDPR) 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, PT Indonesia Pondasi Raya Tbk's WACC % is 6.41%. PT Indonesia Pondasi Raya Tbk's ROIC % is 6.79% (calculated using TTM income statement data).
PT Indonesia Pondasi Raya Tbk 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.
PT Indonesia Pondasi Raya Tbk 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.
PT Indonesia Pondasi Raya Tbk ROIC % Related Terms
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PT Indonesia Pondasi Raya Tbk (ISX:IDPR) Business Description
PT Indonesia Pondasi Raya Tbk is an Indonesia-based company. It is engaged in the planning and construction of buildings, and foundation construction works. The company operates in five segments namely Foundation construction, Retaining Walls construction, Structure, Piling, and Precast Walls. The majority of the revenue is generated from the Foundation construction segment. The company also offers services such as land Structure Improvement, pile testing, slurry walls, ground anchor, excavation, and other construction-related works. It offers construction services for various building and infrastructure projects, ranging from housings, the house of worships, hospitals, and skyscrapers to roads, underpasses, and others.
PT Indonesia Pondasi Raya Tbk (ISX:IDPR) Headlines
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