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Investors Should Be Encouraged By Raghav Productivity Enhancers' (NSE:RPEL) Returns On Capital

Simply Wall St · 2d ago

There are a few key trends to look for if we want to identify the next multi-bagger. Typically, we'll want to notice a trend of growing return on capital employed (ROCE) and alongside that, an expanding base of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. So when we looked at the ROCE trend of Raghav Productivity Enhancers (NSE:RPEL) we really liked what we saw.

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Return On Capital Employed (ROCE): What Is It?

For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. To calculate this metric for Raghav Productivity Enhancers, this is the formula:

Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)

0.25 = ₹565m ÷ (₹2.6b - ₹322m) (Based on the trailing twelve months to September 2025).

So, Raghav Productivity Enhancers has an ROCE of 25%. That's a fantastic return and not only that, it outpaces the average of 12% earned by companies in a similar industry.

See our latest analysis for Raghav Productivity Enhancers

roce
NSEI:RPEL Return on Capital Employed December 10th 2025

While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you're interested in investigating Raghav Productivity Enhancers' past further, check out this free graph covering Raghav Productivity Enhancers' past earnings, revenue and cash flow.

The Trend Of ROCE

We like the trends that we're seeing from Raghav Productivity Enhancers. The data shows that returns on capital have increased substantially over the last five years to 25%. The amount of capital employed has increased too, by 353%. The increasing returns on a growing amount of capital is common amongst multi-baggers and that's why we're impressed.

What We Can Learn From Raghav Productivity Enhancers' ROCE

All in all, it's terrific to see that Raghav Productivity Enhancers is reaping the rewards from prior investments and is growing its capital base. And investors seem to expect more of this going forward, since the stock has rewarded shareholders with a 33% return over the last year. So given the stock has proven it has promising trends, it's worth researching the company further to see if these trends are likely to persist.

On the other side of ROCE, we have to consider valuation. That's why we have a FREE intrinsic value estimation for RPEL on our platform that is definitely worth checking out.

If you'd like to see other companies earning high returns, check out our free list of companies earning high returns with solid balance sheets here.