Managing Partner & CIO @Compcircle .Passionate about sports ,markets, politics n movies. Views on mkts personal
Dec 26, 2021 • 4 tweets • 1 min read
ROE vs ROCE 1. ROE =Net profit/Total Equity
Measures d return co is generating for shareholders & efficiency of how it uses d funds
Asian paints ROE for 3yrs is 28%
means it is sensible to retain earnings than pay dividends.Infosys did 4 a long time & Berkshire does til date
ROCE =EBIT/Capital Employed
measure of how efficiently co utilises all available capital (equity +long term debt). For Telecom, capital goods which hv higher gestation period,ROCE is a better measure
Payback -If ROCE is 33% it means total capital of d co has a payback of 3yr
Apr 11, 2020 • 5 tweets • 2 min read
Wid lot of buzz on #pharma sector, spoke to Sailesh Raj Bhan n Aditya Khemka
Top 10 takeaways
1.Pharma always outperformed broader index till 2015. Frm 2016-2019 it underperformed
2.Export to US & pricing issues, IPM growth slowdown led to sub optimal return ratios 3. Excluding #COVID__19 last 12-18 months earnings started to improve
4. Leading cos showed high single digit volume growth n 13-15% earnings growth in last 5-6 qtrs
5. Domestic business share improved from 30% in 2015 to 50% plus giving stability
