These 7 companies post RoE of over 25% in each of last 3 fiscal years, do you own any?
Return on equity (RoE) is a ratio measured by dividing the company's shareholder equity with its annual profit. Companies that post RoE of more than 15% are considered to be in a good shape
Return on equity (RoE) is a ratio measured by dividing the company's shareholder equity with its annual profit. It tells an investor how well it is using its capital. Companies that post RoE of more than 15 percent are generally considered to be in a good shape. Moneycontrol analysed companies that reported at least 25 percent RoE in each of the last three years. We considered only those companies whose current market-cap is over Rs 1,000 crore. From the BSE universe, 35 companies have met the above criteria. Interestingly, seven stocks from the list have gained between 100 percent and 400 percent in the last 3-year time frame. However, during the same period, there are a few stocks that have given negative returns despite good RoE. It must be noted that RoE is not the only metric that investors should look at. (Data Source: ACE Equity).
2/8
Ion Exchange (India) Ltd. | In last 3 years, the stock has risen 424 percent to Rs 2214.15 on August 23, 2021 from Rs 422 on August 23, 2018. The company's RoE in FY19: 28.40 percent, FY20: 30.08 percent, and FY21: 33 percent.
3/8
Vaibhav Global Ltd. | In last 3 years, the stock has risen 409 percent to Rs 700.75 on August 23, 2021 from Rs 138 on August 23, 2018. The company's RoE in FY19: 25.42 percent, FY20: 26.93 percent, and FY21: 32.31 percent.
4/8
Tata Elxsi Ltd. | In last 3 years, the stock has risen 223 percent to Rs 4677.95 on August 23, 2021 from Rs 1447 on August 23, 2018. The company's RoE in FY19: 34.50 percent, FY20: 25.20 percent, and FY21: 30.15 percent.
Larsen & Toubro Infotech Ltd. | In last 3 years, the stock has risen 166 percent to Rs 5055.85 on August 23, 2021 from Rs 1898 on August 23, 2018. The company's RoE in FY19: 35.20 percent, FY20: 29.92 percent, and FY21: 30.79 percent.
6/8
Indian Energy Exchange Ltd. | In last 3 years, the stock has risen 150 percent to Rs 415.65 on August 23, 2021 from Rs 166 on August 23, 2018. The company's RoE in FY19: 45.40 percent, FY20: 47.32 percent, and FY21: 45.97 percent.
7/8
Sonata Software Ltd. | In last 3 years, the stock has risen 139 percent to Rs 856.20 on August 23, 2021 from Rs 358 on August 23, 2018. The company's RoE in FY19: 35.07 percent, FY20: 38.65 percent, and FY21: 31.08 percent.
8/8
ICICI Securities Ltd. | In last 3 years, the stock has risen 107 percent to Rs 669.00 on August 23, 2021 from Rs 323 on August 23, 2018. The company's RoE in FY19: 51.80 percent, FY20: 48.16 percent, and FY21: 70.98 percent.
