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Investors Will Want Filatex Fashions' (NSE:FILATFASH) Growth In ROCE To Persist

Simply Wall St · 3d ago

What trends should we look for it we want to identify stocks that can multiply in value over the long term? One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing 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. So when we looked at Filatex Fashions (NSE:FILATFASH) and its trend of ROCE, we really liked what we saw.

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What Is 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 Filatex Fashions:

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

0.0043 = ₹102m ÷ (₹25b - ₹1.5b) (Based on the trailing twelve months to September 2025).

So, Filatex Fashions has an ROCE of 0.4%. In absolute terms, that's a low return and it also under-performs the Luxury industry average of 11%.

View our latest analysis for Filatex Fashions

roce
NSEI:FILATFASH Return on Capital Employed January 8th 2026

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'd like to look at how Filatex Fashions has performed in the past in other metrics, you can view this free graph of Filatex Fashions' past earnings, revenue and cash flow.

So How Is Filatex Fashions' ROCE Trending?

We're delighted to see that Filatex Fashions is reaping rewards from its investments and is now generating some pre-tax profits. Shareholders would no doubt be pleased with this because the business was loss-making five years ago but is is now generating 0.4% on its capital. Not only that, but the company is utilizing 3,162% more capital than before, but that's to be expected from a company trying to break into profitability. We like this trend, because it tells us the company has profitable reinvestment opportunities available to it, and if it continues going forward that can lead to a multi-bagger performance.

What We Can Learn From Filatex Fashions' ROCE

Overall, Filatex Fashions gets a big tick from us thanks in most part to the fact that it is now profitable and is reinvesting in its business. Given the stock has declined 60% in the last year, this could be a good investment if the valuation and other metrics are also appealing. That being the case, research into the company's current valuation metrics and future prospects seems fitting.

One final note, you should learn about the 3 warning signs we've spotted with Filatex Fashions (including 1 which can't be ignored) .

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