ROE and ROCE not correct for many companies

Question

ROE and ROCE not correct for many companies

Opened this issue 6 years ago · 2 comments

Have a look at ROE and ROCE of many companies. It is wrong. Example is indo count and ajanta pharma

Answer 1 · 2018-07-03T05:59:53.000Z

noticed that as well

Answer 2 · 2018-07-03T08:49:21.000Z

ROE is calculated on annual numbers from the annual report. It is because it requires the average opening and closing capital employed so in this case (Indo count) it is calculated as follows:
Net profit less extraordinary items = 228.03 - (-0.70) = 228.73,
Opening capital employed - 613.88,
Closing capital employed - 826.55,
Average capital employed - 720.215,
So, ROE - 31.76%