PT KDB Tifa Finance Tbk (ISX:TIFA) ROIC % : 3.81% (As of Mar. 2024)

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What is PT KDB Tifa Finance Tbk 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 %. PT KDB Tifa Finance Tbk's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was 3.81%.

As of today (2024-05-28), PT KDB Tifa Finance Tbk's WACC % is 9.50%. PT KDB Tifa Finance Tbk's ROIC % is 0.99% (calculated using TTM income statement data). PT KDB Tifa Finance Tbk earns returns that do not match up to its cost of capital. It will destroy value as it grows.

PT KDB Tifa Finance Tbk ROIC % Historical Data

The historical data trend for PT KDB Tifa Finance Tbk'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.

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PT KDB Tifa Finance Tbk ROIC % Chart

PT KDB Tifa Finance Tbk Annual Data

Trend

Dec20

Dec21

Dec22

Dec23

ROIC %

5.53

4.42

PT KDB Tifa Finance Tbk Quarterly Data
	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROIC %	Get a 7-Day Free Trial									4.83	-	-	-	3.81

Competitive Comparison of PT KDB Tifa Finance Tbk's ROIC %

For the Credit Services subindustry, PT KDB Tifa Finance 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 KDB Tifa Finance Tbk's ROIC % Distribution in the Credit Services Industry

For the Credit Services industry and Financial Services sector, PT KDB Tifa Finance Tbk's ROIC % distribution charts can be found below:

* The bar in red indicates where PT KDB Tifa Finance Tbk's ROIC % falls into.

PT KDB Tifa Finance Tbk ROIC % Calculation

PT KDB Tifa Finance Tbk's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROIC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	83339.667 * ( 1 - 19.97% )	/	( (1404045.69	+	1616025.906)	/ 2 )
=	66696.7355001	/	1510035.798
=	4.42 %

where

	Invested Capital		(A: Dec. 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	))
=	1601438.462	-	39275.222	-	( 158117.55	-	max(0, 480659.785	-	1395726.858	+	158117.55	))
=	1404045.69

	Invested Capital		(A: 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	))
=	1801376.731	-	42223.517	-	( 143127.308	-	max(0, 627413.902	-	1653977.225	+	143127.308	))
=	1616025.906

PT KDB Tifa Finance Tbk's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROIC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	74865.796 * ( 1 - 19.97% )	/	( (1616025.906	+	1530351.061)	/ 2 )
=	59915.0965388	/	1573188.4835
=	3.81 %

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	))
=	1801376.731	-	42223.517	-	( 143127.308	-	max(0, 627413.902	-	1653977.225	+	143127.308	))
=	1616025.906

	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	))
=	1741590.939	-	33017.217	-	( 178222.661	-	max(0, 552590.998	-	1645908.658	+	178222.661	))
=	1530351.061

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

PT KDB Tifa Finance Tbk (ISX:TIFA) 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 KDB Tifa Finance Tbk's WACC % is 9.50%. PT KDB Tifa Finance Tbk's ROIC % is 0.99% (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.

PT KDB Tifa Finance Tbk ROIC % Related Terms

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PT KDB Tifa Finance Tbk (ISX:TIFA) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Credit Services » PT KDB Tifa Finance Tbk (ISX:TIFA) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Jl. Jenderal Sudirman Kav. 52-53, SCBD Lot 9, Equity Tower Lantai 39, South Jakarta, IDN, 12190

Website

https://www.kdbtifa.co.id

PT KDB Tifa Finance Tbk is a financial service company. It also provides both Conventional financing and Shariah-based financing. Its operating segments include Finance Lease; Multipurpose Financing; Sharia Financing. It generates maximum revenue from the Finance Lease segment. It operates in different industries namely infrastructure, consumer goods, logistics, and health and beauty equipment.

PT KDB Tifa Finance Tbk (ISX:TIFA) Headlines

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