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The Return Trends At Pan Pacific International Holdings (TSE:7532) Look Promising

Simply Wall St · 6d ago

What trends should we look for it we want to identify stocks that can multiply in value over the long term? Amongst other things, we'll want to see two things; firstly, a growing return on capital employed (ROCE) and secondly, an expansion in the company's amount of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. Speaking of which, we noticed some great changes in Pan Pacific International Holdings' (TSE:7532) returns on capital, so let's have a look.

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Understanding Return On Capital Employed (ROCE)

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. Analysts use this formula to calculate it for Pan Pacific International Holdings:

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

0.15 = JP¥163b ÷ (JP¥1.5t - JP¥405b) (Based on the trailing twelve months to September 2025).

So, Pan Pacific International Holdings has an ROCE of 15%. In absolute terms, that's a satisfactory return, but compared to the Multiline Retail industry average of 9.1% it's much better.

Check out our latest analysis for Pan Pacific International Holdings

roce
TSE:7532 Return on Capital Employed January 1st 2026

Above you can see how the current ROCE for Pan Pacific International Holdings compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like to see what analysts are forecasting going forward, you should check out our free analyst report for Pan Pacific International Holdings .

What The Trend Of ROCE Can Tell Us

Pan Pacific International Holdings is showing promise given that its ROCE is trending up and to the right. The figures show that over the last five years, ROCE has grown 88% whilst employing roughly the same amount of capital. Basically the business is generating higher returns from the same amount of capital and that is proof that there are improvements in the company's efficiencies. The company is doing well in that sense, and it's worth investigating what the management team has planned for long term growth prospects.

What We Can Learn From Pan Pacific International Holdings' ROCE

To sum it up, Pan Pacific International Holdings is collecting higher returns from the same amount of capital, and that's impressive. And a remarkable 111% total return over the last five years tells us that investors are expecting more good things to come in the future. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence.

While Pan Pacific International Holdings looks impressive, no company is worth an infinite price. The intrinsic value infographic for 7532 helps visualize whether it is currently trading for a fair price.

While Pan Pacific International Holdings isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets.