Rate of Return – Local Collectors Post http://www.localcollectorspost.org/ Tue, 21 Jun 2022 10:37:53 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://www.localcollectorspost.org/wp-content/uploads/2021/03/locacollectorspost-icon-70x70.png Rate of Return – Local Collectors Post http://www.localcollectorspost.org/ 32 32 Despite the weapons of the West, Ukraine is under-armed in the East https://www.localcollectorspost.org/despite-the-weapons-of-the-west-ukraine-is-under-armed-in-the-east/ Tue, 21 Jun 2022 10:35:45 +0000 https://www.localcollectorspost.org/despite-the-weapons-of-the-west-ukraine-is-under-armed-in-the-east/

BAKHMUT, Ukraine – Despite the massive influx of weapons from the West, Ukrainian forces are being overtaken by the Russians in the battle for the eastern region of Donbass, where fighting is largely taking place through artillery exchanges.

While the Russians can sustain heavy and continuous fire for hours at a time, the defenders cannot match the enemy in weapons or ammunition and must use their ammunition more wisely.

Entrenched in a bombed-out house in eastern Ukraine, Ukrainian troops keep a careful count of their ammunition, using a door as a sort of ledger. Scribbled in chalk on the door are numbers of mortar shells, smoke shells, shell shells and flares.

At the outpost in eastern Ukraine, dozens and dozens of mortar shells are stacked. But troop commander Mykhailo Strebizh lamented that if his fighters were to endure an intense artillery barrage, their cache would amount to, at best, only about four hours of return fire.

Ukrainian officials say Western support for the country is not enough and is not arriving on the battlefield fast enough for this crushing and highly deadly phase of the war.

While Russia has kept silent about its war casualties, Ukrainian authorities say up to 200 of their soldiers die every day. Russian forces are slowly gaining ground in the east, but experts say they are suffering heavy casualties.

Experts note that aid deliveries have not kept pace with Ukraine’s needs, in part because defense industries are not producing weapons fast enough.

“We are moving from peacetime to wartime,” said Francois Heisbourg, senior adviser to the Paris-based Foundation for Strategic Research think tank. “Peacetime means low production rates, and increasing the production rate means you have to build industrial facilities first. … This is a defense industrial challenge that is of very great magnitude.”

The Kiel Institute for the World Economy in Germany reported last week that the United States had honored about half of its military support commitments to Ukraine, and Germany about a third. Both Poland and Britain kept their promises.

Many infantrymen say they cannot even begin to match the Russians shot for shot, or shell for shell.

Ukrainian filmmaker-turned-fighter Volodymyr Demchenko tweeted a video expressing his gratitude for the guns sent by the Americans, saying, “These are nice guns and 120 bullets each.” But he lamented: “It’s like 15 minutes of fighting.”

Part of the problem is also that Ukrainian forces, whose country was once a member of the Soviet Union, are more familiar with Soviet-era weaponry and must first be trained on NATO equipment than they receive.

Countless Ukrainians have traveled abroad to train on Western weapons.

Only a little over a third of the US$1 billion pledge will be Pentagon-ready, fast delivery, and the rest will be available in the longer term. The pledge, which includes 18 howitzers and 36,000 rounds for them, responds to Ukraine’s call for more longer-range weapons.

This is still far from what the Ukrainians want – 1,000 155mm howitzers, 300 multiple rocket launchers, 500 tanks, 2,000 armored vehicles and 1,000 drones – as tweeted President Volodymyr Zelensky’s adviser Mikhail Podolyak, last week, before the last major Western debate. pledges.

“What the Ukrainians have to do is conduct what the military tends to call a counter-battery operation” to respond to Russian artillery fire, said Ben Barry, former director of the general staff of British Army and Senior Fellow for Land Warfare at the International Institute for Strategic Studies. “To do that, you need accurate weapons with a high rate of fire and a range that allows them to stay clear of the artillery on the other side.”

“The Ukrainians say they don’t have enough long-range rockets to adequately suppress Russian artillery,” he said. “I think they’re probably right.”

As things stand, Ukrainian fighters often have to use “shoot and dash” tactics – shoot, then move before the Russians can focus on them.

Better NATO hardware, even in small quantities, is often welcome.

On a nearby front on Saturday, a Ukrainian unit granted the Associated Press rare access to fire US-supplied M777 howitzers – 155mm towable weapons – at Russian positions.

A lieutenant who uses the Wasp call sign praised the M777’s accuracy, firing speed, ease of use and ease of camouflage, saying the new hardware “lifts our spirits” and ” demoralizes the enemy because he sees the consequences”. are.”

Denys Sharapov, Ukraine’s Deputy Defense Minister for Procurement, told a publication of the US-based National Defense Industrial Association that the weapons systems received only cover 10-15% of the country’s needs. . He noted the scale of the challenge – a front line with 620 miles of active combat.

Interviewed by National Defense magazine in an article published on June 15, Sharapov said that no supplier alone could meet Ukraine’s needs.

The friends of Ukraine are committed for the long term.

Time may be on Ukraine’s side, experts say. Ukrainian fighters are motivated and mobilized – all men in the country of 40 million people have been called up to fight, while Russia has so far avoided a call for conscripts.

As for how long those fights might go on, Heisbourg said a year-long war of attrition is “very possible.”

Information for this article was provided by Srdjan Nedeljkovic of The Associated Press.

FILE – Debris hangs from a residential building heavily damaged in a Russian bombardment in Bakhmut, eastern Ukraine, eastern Ukraine, Saturday, May 28, 2022. (AP Photo/Francisco Seco, File)
Photo FILE – People walk past part of a rocket stuck in the ground in Lysychansk, Lugansk region, Ukraine, Friday, May 13, 2022. (AP Photo/Leo Correa, File)
Photo FILE – French President Emmanuel Macron, left, talks to arms industrialists near a CAESAR self-propelled howitzer artillery system as they visit the Eurosatory Land Defense and Security Exhibition and aeroterrestrials, at the Paris-Nord Villepinte exhibition center in Villepinte, north of Paris, Monday, June 13, 2022. (Ludovic Marin, Pool via AP, File)
Photo FILE – A Ukrainian tank stands in position during heavy fighting on the front line in Severodonetsk, Lugansk region, Ukraine, Wednesday, June 8, 2022. (AP Photo/Oleksandr Ratushniak, File)
Photo FILE – In this image provided by the Ukrainian Presidential Press Office, Ukrainian President Volodymyr Zelenskyy, center, and British Prime Minister Boris Johnson walk in the square where damaged Russian military vehicles are displayed in Kyiv, Ukraine, on Friday June 17, 2022. (Ukrainian Presidential Press Office via AP, file)
Photo FILE – Shells used by a Ukrainian artillery unit are stored in a house in a village near the frontline in the Donetsk Oblast region of eastern Ukraine on Thursday, June 2 2022. (AP Photo/Bernat Armangue, File)
Photo FILE – Ukrainian soldiers fire at Russian positions from a US-supplied M777 howitzer in the Donetsk region of eastern Ukraine on Saturday, June 18, 2022. (AP Photo/Efrem Lukatsky , Queue)
Photo FILE – Ukrainian military officials move the bodies of slain Russian soldiers into a refrigerator in Kharkiv, Ukraine, Saturday, June 18, 2022. (AP Photo/Andrii Marienko, File)
Photo FILE – Commander of a Ukrainian army artillery unit, Mykhailo Strebizh, center, inside a house destroyed due to shelling in a village near the front line in the region of Donetsk Oblast, eastern Ukraine, Thursday, June 2, 2022. (AP Photo/ Bernat Armangue, File)
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As Taka weakens, foreign investors withdraw Tk6,000 from shares https://www.localcollectorspost.org/as-taka-weakens-foreign-investors-withdraw-tk6000-from-shares/ Sun, 19 Jun 2022 17:00:00 +0000 https://www.localcollectorspost.org/as-taka-weakens-foreign-investors-withdraw-tk6000-from-shares/

Currency devaluation led to a sharp sell-off of foreign investment portfolios in the stock market, with the weakening of the taka against the dollar eroding profits for foreign investors.

The sell-off in foreign investment portfolio stocks has put pressure on the stock market, keeping price indices down.

According to Dhaka Stock Exchange (DSE) data, foreign investment outflow from the stock market was Tk 1,000 crore in the first four months of this year, while inflow was only 300 crore. crores of Tk. Last year, foreign investment outflow was Tk 5,000 crore while inflow was Tk 2,000 crore.

The Bangladesh Bank started a devaluation in August last year to give the economy an edge amid rising import spending and slowing remittances and export earnings.

Foreign investors began to sell equities early in the year to avoid losses related to a possible correction of the exchange rate in the context of a global rise in the price of the dollar following the Russian-Ukrainian conflict.

In January last year, the interbank exchange rate was 84.80 Tk, meaning a foreign investor would receive one dollar for every share sold at that price.

Now, an investor would get less than a dollar even if a stock were sold at the same price, as the interbank exchange rate jumped to 92.80 Tk after continuous devaluation by the Bangladesh Bank in recent months.

Thus the devaluation has been disadvantageous for foreign investors who now find themselves spending more to recover the proceeds of their sales after converting the local currency into dollars.

The equity rate of return was also unable to offset losses from the devaluation as stock market price indices remained lower amid rising inflation and growing nervousness over the global market, market insiders said.

Net portfolio investment turned negative $269m at the end of FY21, compared to positive $44m in FY20, according to Bangladesh Bank data.

The negative net position means that the outflows were greater than the inflows.

Besides the devaluation, another factor discouraging foreign investors from holding shares in Bangladesh is rising interest rates in the US market, said Dr. Zahid Hussain, a former senior economist at the World Bank office in Dhaka.

He said foreign investors started selling stocks from last year to avoid possible losses from devaluation. This is because the difference between the rates of return was no greater than their expected amortization loss.

There is a risk of currency devaluation as the country’s trade deficit widens, so foreign investment is likely to remain sluggish in the coming days, he said.

Rising rates make US Treasury bonds more profitable for foreign investors and there is a possibility of further interest rate increases to keep inflation under control. As a result, investing in US Treasuries is more profitable for them than investing in emerging markets, he added.

The US Federal Reserve recently raised its main interest rate by 75 basis points – the biggest increase since 1994 – to a range of 1.5% to 1.75% to keep inflation under control.

While US inflation had reached 8.6%, a 40-year high, the US Federal Reserve carried out a massive hike, the third since March, in the key rate and with signs of further hikes in the coming months. come.

Ahsanur Rahman, managing director of BRAC Stock Brokerage, the leading brokerage in foreign investment management, said the Bangladesh stock market was no longer attractive to foreign investors due to multiple factors including devaluation and the rise in US rates.

Moreover, many foreign funds from frontier markets closed during the pandemic, which also impacted foreign investment inflows, he said.

Ahsanur said foreign investors have taken safe positions to watch the exchange rate market and may not be active until the rate is stable.

The exchange rate, which had remained stable between Tk 84 and 85 for several years due to central bank intervention, crossed Tk 90 in June for the first time in the country’s history, with the latest rate at 92.80 Tk.

Over the past year and a half, the taka has weakened 9.4% against the dollar.

Currently, insiders believe that the widening trade deficit and the dollar crisis in the market signal a further devaluation of the dollar.

The country’s trade deficit hit an all-time high of $27.56 billion in the first 10 months of the current fiscal year, according to central bank data.

In the proposed budget speech for the next fiscal year, Finance Minister AHM Mustafa Kamal said the taka’s exchange rate against the US dollar would remain competitive, which many believe signifies hints of a new devaluation.

He also said that the stability of foreign exchange reserves would be a big challenge for the government in the context of price volatility in the international market.

However, he stressed the need for foreign investment to sustain growth.

“The government has also organized and sponsored seminars and workshops, road shows and trade shows inside and outside the country. All these arrangements are aimed at identifying potential investors, highlighting opportunities existing investment frameworks, to incentivize them to invest and to accelerate the removal of barriers to investment,” he said.

Although the Securities and Exchange Commission of Bangladesh has organized several road shows in different countries to attract foreign investment in the stock market, its impact has not been reflected in the foreign investment portfolio.

Movement of stock market price indices

The Dhaka Stock Exchange’s broad index fell 16% in eight months, from October last year to May this year. The DSEX hit 7300 in October last year, a year high, but it didn’t last long due to the rapid devaluation of the taka amid a severe dollar crisis in the market. which put pressure on the stock market and dragged the price index to 6100. in May this year, according to the DSE.

Daily turnover also saw a sharp drop to an average of Tk 600 crore from Tk 1800 crore during the same period.

Neighboring India also came under selling pressure in the stock market due to currency devaluation.

Indian stocks fell after the rupee hit a record high of 78.28 rupees to the dollar in June.

Benchmarks Nifty and Sensex plunged 2.64% and 2.68%, respectively, on the day India’s currency topped Rs78 to the dollar, the biggest drop since early March, according to Indian media.

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Why Anmol India Limited (NSE:ANMOL) looks like a quality company https://www.localcollectorspost.org/why-anmol-india-limited-nseanmol-looks-like-a-quality-company/ Fri, 17 Jun 2022 01:09:06 +0000 https://www.localcollectorspost.org/why-anmol-india-limited-nseanmol-looks-like-a-quality-company/

One of the best investments we can make is in our own knowledge and skills. With that in mind, this article will explain how we can use return on equity (ROE) to better understand a business. We will use ROE to examine Anmol India Limited (NSE:ANMOL), as a concrete example.

Return on Equity or ROE is a test of how effectively a company increases its value and manages investors’ money. In other words, it is a profitability ratio that measures the rate of return on capital contributed by the company’s shareholders.

See our latest analysis for Anmol India

How do you calculate return on equity?

ROE can be calculated using the formula:

Return on equity = Net income (from continuing operations) ÷ Equity

So, based on the above formula, the ROE for Anmol India is:

26% = ₹156m ÷ ₹604m (Based on last twelve months to March 2022).

“Yield” refers to a company’s earnings over the past year. This means that for every ₹ of equity, the company generated ₹0.26 of profit.

Does Anmol India have a good return on equity?

A simple way to determine if a company has a good return on equity is to compare it to the average for its industry. It is important to note that this measure is far from perfect, as companies differ significantly within the same industry classification. As the image below clearly shows, Anmol India has a better ROE than the average (6.7%) for the commercial distributor industry.

NSEI:ANMOL Return on Equity June 17, 2022

This is clearly a positive point. That said, a high ROE does not always mean high profitability. In addition to changes in net income, a high ROE can also be the result of high debt to equity, which indicates risk. To know the 3 risks we have identified for Anmol India, visit our risk dashboard for free.

Why You Should Consider Debt When Looking at ROE

Most businesses need money – from somewhere – to increase their profits. This money can come from issuing shares, retained earnings or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt necessary for growth will boost returns, but will not impact equity. In this way, the use of debt will increase ROE, even though the core economics of the business remains the same.

Anmol India’s debt and its ROE of 26%

Anmol India is clearly using a high amount of debt to boost returns, as its debt-to-equity ratio is 2.96. Although its ROE is quite respectable, the amount of debt the company is currently carrying is not ideal. Investors need to think carefully about how a company would perform if it weren’t able to borrow so easily, as credit markets change over time.

Conclusion

Return on equity is a useful indicator of a company’s ability to generate profits and return them to shareholders. In our books, the highest quality companies have a high return on equity, despite low leverage. If two companies have roughly the same level of debt and one has a higher ROE, I generally prefer the one with a higher ROE.

But ROE is only one piece of a larger puzzle, as high-quality companies often trade on high earnings multiples. The rate at which earnings are likely to grow, relative to earnings growth expectations reflected in the current price, should also be considered. So I think it’s worth checking it out free this detailed graph past profits, revenue and cash flow.

Sure Anmol India may not be the best stock to buy. So you might want to see this free collection of other companies that have high ROE and low debt.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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3 easy ways to earn $50,000 in passive income with real estate https://www.localcollectorspost.org/3-easy-ways-to-earn-50000-in-passive-income-with-real-estate/ Wed, 15 Jun 2022 09:30:00 +0000 https://www.localcollectorspost.org/3-easy-ways-to-earn-50000-in-passive-income-with-real-estate/

Earning $50,000 a year in passive income — money you don’t have to physically work for to earn — might seem like a pipe dream right now. But with a little money and some strategic investments in real estate, that lofty goal could be much closer than you think.

Real estate has unique advantages through its ability to use leverage and the potential for passive income to grow over time. While you certainly need some initial capital to hit the $50,000 mark, here are three easy ways to do it.

Buy a long-term rental property

Rental real estate is a proven method of passive real estate investing. It is a strategy that can increase earnings exponentially over time through the power of leverage. As an investor and owner, you only have to make an initial investment of 20% to buy the property, while borrowing the rest. The tenant pays the remaining expenses, maintenance and mortgage of the house. Any money left over after these costs is passive income that you receive each month.

You can raise rents to meet market demand or adjust for inflation to increase your income, but many rental investors choose to use the extra cash flow to pay off the mortgage faster. By doing this, you can increase the passive income you earn by eliminating debt and turn what could have been $200 of cash flow into $1,000 or more at no additional cost.

Own a vacation rental

The vacation rental business is booming right now thanks to a shift in where consumers stay while on vacation. More space, amenities, and unique destinations are becoming the norm, allowing everyday investors to earn plenty of passive income by renting vacation property and hiring a third-party property manager to rent it out.

Investors have the same benefit of only needing a 20% down payment, with tenants paying the ongoing cost of the property and mortgage over time. But the potential for passive income is even greater because vacation rentals are typically based on nightly rates, not monthly.

Seasonality and demand will determine the rate per night, and revenue can fluctuate significantly from month to month with higher vacancy rates compared to a typical rental. But if you’re buying into a booming vacation market and have competitive amenities, vacation rentals can be a cash cow from the get-go.

Invest in REITs with high dividends

Real Estate Investment Trusts (REITs) are by far the easiest and most accessible way for you to start earning passive income. REITs invest in and own real estate and real estate-related securities, providing everyday investors exposure to institutional-grade real estate portfolios across all sectors of commercial and residential real estate.

In order for REITs to benefit from certain tax advantages offered in the REIT structure, they are required to pay out 90% of taxable income in the form of dividends. This leads to super-reliable, above-average dividends – many of which are increased as the business grows, increasing returns and passive income over time.

The path to $50,000

The rate of return you receive in an investment is important. The higher the return, the faster you will reach your annual passive income goal of $50,000.

As an investor, I aim for an 8% to 12% return on all rental properties I buy. Assuming the property is around the median price of $300,000, I would bring in $6,000 in passive income each year assuming a 10% return on my $60,000 down payment. This means that to reach $30,000 in passive rental income, I would need to invest about $300,000 in five properties that are earning at least 10% return. It’s not $50,000, but it’s more than half.

Higher dividend REITs offering a 5-10% yield are quite common, but they are not without risk. For instance, Simon Real Estate Group, the world’s largest shopping center operator, currently offers an attractive dividend yield of 8%. But the continued recovery of malls raises concerns, particularly if the U.S. economy slips into a recession, which could further hurt its already slumping sales and foot traffic.

REITs that offer safer dividend yields are generally in the 2% to 4% yield range. Prologis, the largest REIT by market capitalization and the largest industrial REIT specializing in the operation of warehouses, industrial racks and distribution centers around the world, currently returns around 2.9%, but with much less risk . Before you buy, make sure you understand each REIT’s unique risks, opportunities, and business model in relation to its return. Higher returns aren’t always better in the long run, especially considering a REIT’s ability to grow.

A yield of 2% or 4% today has the potential to increase further in the future as the company increases its dividend. Real estate income (O -0.66%) is a dividend aristocrat, which means he has increased his dividends for at least 25 consecutive years. It currently has a dividend yield of 4.7%, but that doesn’t mean that’s the yield investors face if they hold for the long haul. A $300,000 investment in the business 10 years ago would net you $1,861 in dividend income per month today, a 7.4% return, and a whopping $22,336 every year.

As you can see, $50,000 a year in passive income isn’t that far off. If you have $600,000 to invest, your goal can be achieved with the potential to become so much more.

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Delay of projects for poor preparation, coordination https://www.localcollectorspost.org/delay-of-projects-for-poor-preparation-coordination/ Mon, 13 Jun 2022 18:00:00 +0000 https://www.localcollectorspost.org/delay-of-projects-for-poor-preparation-coordination/

About 76% of government officials involved in the preparation, processing and appraisal of development projects believe that projects are approved without a proper feasibility study and consultations with stakeholders, according to a recent study.

And about 26% of survey respondents said they had experienced such deficiencies in 61-81% of projects, according to the Implementation Monitoring and Evaluation Division study on slow implementation. the implementation of development projects.

For all the latest news, follow the Daily Star’s Google News channel.

“This is a major area of ​​concern,” says the report, which is based on a survey of 100 government officials, focus group discussions, project data from the past five years and interviews with consultants. , retired government officials and project managers.

This is the first study of its kind conducted by the government, Md. Taibur Rahman, director of IMED and one of the study’s researchers, told the Daily Star yesterday.

Bangladesh is late in completing most projects on time and within budget, leading to cost overruns and reducing expected project benefits.

Poor and slow implementation rates of high-profile fast-track projects such as Padma Bridge, Padma Bridge Rail Link and Dhaka Metro are examples, according to the report, which was released on June 6.

Of the government’s eight fast-track projects, six have already been revised and a proposed revision for another – the metro – has been submitted. Only the Rooopur nuclear power plant project has not yet been revised.

Due to escalating costs and delays, the majority of projects fail to achieve the initially set goals and targets, including internal rate of return, financial rate of return, and economic rate of return.

Therefore, it is important to identify the main causes and take the necessary measures to prevent such poor governance of public projects.

Around 85% of respondents agreed that projects requiring civil works lack proper engineering drawings, which is critical to the success of projects.

About 72% of respondents agreed or strongly agreed that weak project documents are a major impediment. Only 16% were indifferent and 12% disagreed.

“This indicates that the overwhelming majority felt that the project documents are weak and this is a serious problem.”

About 16% of respondents experience a high incidence of such a problem: 61-81%.

As many as 89 percent of respondents agreed with the statement that there are insufficient resources to prepare a Decent Development Project Proposal (DPP).

About 70% of respondents believe that more than 40% of projects had a weak PPD or technical project proposal (TPP) due to a lack of adequate resources, he said.

“A few people are involved in the preparation of a large number of DPPs/TPPs and this compromises the quality of project documents, which subsequently leads to delays in project implementation.

This highlights the urgent need to strengthen the planning component of all administrative ministries.

About 74% of respondents agreed or strongly agreed that the DPP/TPP procurement and work plan is not closely monitored.

More than 80% of respondents believe that there is a lack of transparency and accountability in the implementation of projects. Three-quarters of respondents believe that more than 40% of projects had such challenges.

More than 90% agreed that the recruitment of PDs and project staff and the frequent transfer of PDs were delaying project implementation, he said.

Subsequently, the study called for the appointment of full-time project managers and fewer opportunities for review.

About 80 percent of respondents think there is a lack of coordination between implementing agencies on the ground.

As many as 80 percent of respondents believe that the project appraisal committee and the project steering committee, two major committees responsible for monitoring project implementation, do not meet regularly, becoming a major cause of project delays.

Sometimes non-professionals are included in the committees, which creates problems.

About 95% of respondents agreed or strongly agreed that good contractors are not selected, suggesting the extent of the problem.

About three-quarters of respondents believe that more than 40% of projects experienced such problems.

About 91% believe that land acquisition is a major challenge in carrying out projects.

Subsequently, the report called for ensuring all kinds of building materials, land, power supply, procurement, customs clearance and other utilities at the time of project implementation.

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Kangji Medical Holdings (HKG:9997) reinvests at lower rates of return https://www.localcollectorspost.org/kangji-medical-holdings-hkg9997-reinvests-at-lower-rates-of-return/ Sun, 12 Jun 2022 00:57:36 +0000 https://www.localcollectorspost.org/kangji-medical-holdings-hkg9997-reinvests-at-lower-rates-of-return/

If you’re looking for a multi-bagger, there are a few things to watch out for. First, we would like to identify a growth come back on capital employed (ROCE) and at the same time, a base capital employed. Basically, this means that a business has profitable initiatives that it can continue to reinvest in, which is a hallmark of a blending machine. Although, when we looked Kangji Medical Holdings (HKG:9997), it didn’t seem to tick all those boxes.

Return on capital employed (ROCE): what is it?

If you’ve never worked with ROCE before, it measures the “yield” (pre-tax profit) a company generates from the capital used in its business. The formula for this calculation on Kangji Medical Holdings is:

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

0.13 = CN¥418m ÷ (CN¥3.4b – CN¥117m) (Based on the last twelve months to December 2021).

Thereby, Kangji Medical Holdings has a ROCE of 13%. In absolute terms, that’s a decent return, but compared to the medical equipment industry average of 10%, it’s much better.

Check out our latest analysis for Kangji Medical Holdings

SEHK: 9997 Return on capital employed June 12, 2022

Above, you can see how Kangji Medical Holdings’ current ROCE compares to its past returns on capital, but you can’t say anything about the past. If you’re interested, you can check out analyst forecasts in our free analyst forecast report for the company.

So, what is the ROCE trend of Kangji Medical Holdings?

On the surface, the ROCE trend at Kangji Medical Holdings does not inspire confidence. About four years ago the return on capital was 59%, but since then it has fallen to 13%. Although, given that revenue and the amount of assets used in the business have increased, it could suggest that the business is investing in growth and that the additional capital has resulted in a short-term reduction in ROCE. And if the capital increase generates additional returns, the company, and therefore the shareholders, will benefit in the long term.

Kangji Medical Holdings ROCE Basics

While yields have fallen for Kangji Medical Holdings lately, we are encouraged to see that sales are increasing and the company is reinvesting in its operations. However, despite the promising trends, the stock has fallen 43% in the past year, so there could be an opportunity here for shrewd investors. So we think it would be worth taking a closer look at this stock as the trends look encouraging.

On a separate note, we found 1 warning sign for Kangji Medical Holdings you will probably want to know more.

If you want to look for strong companies with excellent earnings, check out this free list of companies with strong balance sheets and impressive returns on equity.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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Best investment options for cash now that bond yields are lagging https://www.localcollectorspost.org/best-investment-options-for-cash-now-that-bond-yields-are-lagging/ Fri, 10 Jun 2022 09:07:40 +0000 https://www.localcollectorspost.org/best-investment-options-for-cash-now-that-bond-yields-are-lagging/

Bond funds are showing negative returns, and returns in recent years have been weak. What is the alternative?

Content of the article

In an increasingly complex world, the Financial Post should be the first place you look for answers. Our FP Answers initiative puts readers in the driver’s seat: you submit questions and our reporters find answers not just for you, but for all of our readers. Today we’re answering a question from Don about investing.

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By Julie Cazzin, with Allan Norman

Q: What are the best options for cash in an investment portfolio now that bonds don’t work? — put on

PF responses: This is a good question because many bond funds are currently posting negative returns, and returns in recent years have been weak. What is the alternative? It depends on why you hold bonds in your portfolio and how comfortable you are with the alternatives.

An investment portfolio is a diverse mix of investments potentially serving different purposes such as growth, income and stability. Bonds are often included to provide income and/or stability.

If you need income from your portfolio – say $30,000 a year – you can put one to five years of income in a bond fund, or $30,000 to $150,000. A bond fund is used to earn income because it is less volatile than a stock fund. As you draw down on your bonds, you can replace them by selling some of your stocks when they produce positive returns.

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Conventional alternatives to bonds include high-interest savings accounts, guaranteed income certificates (GICs), and fractional preferred shares. If you need the money in a year or two, there’s nothing wrong with holding the money in a high-interest savings account. Of course, you won’t win much, but you won’t lose money and you can access it anytime.

GICs offer a guaranteed rate of return, but the challenge is that they are illiquid. They are immobilized, so you have to manage the due dates. Fractional preferred shares have generally provided higher returns than GICs or bonds in recent years. They are traded on an exchange and are normally issued with a unit value of $10/share and a maturity date.

Don, another option if your portfolio is large enough, generates enough dividends and distributions to supplement your income, and you don’t mind volatility, is to hold no bonds at all. In addition to the traditional alternatives to bonds mentioned above, there are non-traditional options.

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About four years ago I attended a conference with a presenter from a major bank and he asked a question similar to yours. “How are retirees going to earn enough in their portfolios to make their money last, but at the same time have a stable portfolio to provide them with income?”

His concern was that even though interest rates have fallen since 1982 and bonds have provided good returns, what if bond yields are low in the future? What if we get bond returns similar to those of the 40 years before 1982 and the portfolios don’t return enough?

Speaking of which, long-term US corporate bonds from 1942 to 1982 returned 2.82% before fees and inflation, but 10.1% from 1982 to 2021, according to Dimensional Fund Advisors Matrix Book.

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One option is to increase the equity component of your portfolio and reduce bond holdings, but this means increasing volatility risk and return sequence risk.

The proposed solution was to use alternative investments, such as private credit and private equity. These investments are not listed on the stock exchange. Part of his rationale was that pension funds use alternatives and they have the same problem as retirees, which is trying to maximize returns while providing income at the same time.

Speaking of which, the Canada Pension Plan currently only has about 40% of its money invested in traditional stock and bond investments. These alternatives include private credit (loans from a lender other than a bank), private equity (owning some or all of an unlisted security or a small company), and private equity. ‘immovable.

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All three have their own set of risks, but they are mostly only available through properly licensed advisers, and there are limits on the amount of alternative investments investors can buy. They are used in a portfolio to provide additional diversification to the traditional bond/equity allocation as well as increased flexibility.

For example, you can replace some of your bond holdings with private credit and some of your equity investments with private equity to reduce volatility and increase returns. The added benefit is that you also have four sources of income to earn rather than two – bonds and stocks. As you draw down your source of income (cash and bonds), you can replenish it from your private credit, private equity, or equity investments.

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Don, I’ve talked about alternatives to bonds, but bonds you own may be just fine. Remember that as interest rates rise, new, higher yielding bonds are purchased into the fund, and this higher rate is ultimately passed on to you. At some point, rates will fall again, perhaps in the next recession, and then you can see your bonds shine.

Allan Norman, M.Sc., CFP, CIM, RWM, provides certified fee-based financial planning services through Atlantis Financial Inc. Allan is also registered as an investment advisor with Aligned Capital Partners Inc. It can be attached to www.atlantisfinancial.ca or alnorman@atlantisfinancial.ca. This commentary is provided as a general source of information and is not intended to be personalized investment advice.

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Supporting clients in a volatile market https://www.localcollectorspost.org/supporting-clients-in-a-volatile-market/ Mon, 06 Jun 2022 17:26:51 +0000 https://www.localcollectorspost.org/supporting-clients-in-a-volatile-market/

“But, traditionally, it will come back. And when it comes back, it can come back quickly or slowly,” she told the client. “The best thing we can do now is take advantage of this negative period and invest slowly over a period of weeks, sometimes months.”

When it comes to managing a client’s emotions during tough markets, Rae said it’s important to really listen to your clients.

“Their feelings are valid. They imagine nothing. Their portfolio is fall,” she said. “[We have] understand that my level of comfort with the market downturn may be different from theirs and really listen to what they say. In the end, it’s their money, and they can do what they want with it. I’m just here to be a sounding board and to make recommendations based on what I know.

For example, the 70-year-old client had a good amount of money in her savings account when she recently sold a property. The money was just there and not earmarked for anything in particular, “so it was a really good opportunity for her to invest,” Rae said. They gradually moved the money from the savings account, positioning the customer to buy on the downside.

David O’Leary, director at Kind Wealth in Toronto, also puts market declines in the context of future gains when speaking with worried clients.

“We’re talking about the fact that when the market goes down, that’s the price we pay for assets to go up over time,” he said. “The market does not rise indefinitely. If stocks went straight up, they wouldn’t offer the same returns. They would offer returns like a GIC. »

O’Leary said this reframing can be effective.

“It ranges from ‘Oh, this is a disaster happening to me,’ to ‘It’s a necessary part, an ingredient to generate the kinds of returns I need,'” he said. ” It’s planned. It’s planned. We created the wallet to weather these types of storms in the first place. We have a plan for that. And I think [those realizations are] empowering people.

Rae said she’s had most of her clients for about 25 years, so they’ve seen about three bear markets in their time with her.

“They’ve had a lot of experience with the ups and downs of the market,” Rae said.

The downside, she said, is that when clients have a higher net worth, like $1 million, and the market is down 10%, “the [absolute] the number of drops is huge” – even if the percentage is the same, which she emphasizes to customers.

Rae used an analogy of flying in an airplane to illustrate her approach to calming customers down.

“I don’t like to fly. When it’s turbulent, I watch the flight attendants to see how their body language is and how their reaction is. And if they’re calm, it calms me down,” Rae said. “If I talk to a client and review the calculations [showing them] ‘10% is 10%’ reassures them that I am calm, I understand that, and everything will be fine. This helps them understand that “it will happen; it will happen again.’

Rae also reminded her clients of the time and work they put into building their respective portfolios and financial plans. Rae likes to take a managed money approach, adding a part cash and a part equity.

“When a client comes to us, especially a client very close to retirement or in retirement, the most important thing is to keep what they have and to have an extra rate of return,” Rae said. “[Having an] a bit boring, and a bit safe and secure, can really make a difference in a bear market.

Rae noted that she tends to stay away from “trendy things,” like cryptocurrencies and cannabis.

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BEXIMCO sukuk will yield 5.8 pc for the first 6 months https://www.localcollectorspost.org/beximco-sukuk-will-yield-5-8-pc-for-the-first-6-months/ Sat, 04 Jun 2022 17:48:00 +0000 https://www.localcollectorspost.org/beximco-sukuk-will-yield-5-8-pc-for-the-first-6-months/

Beximco Green Sukuk al Istisna’a will give 5.8% or Tk 174 crore back to its sukuk holders for the first six months of the first year (December 23, 2021 to June 22, 2022).

Administrator Investment Corporation of Bangladesh made the decision during a meeting of the administration committee on June 2.

The administrator has set June 22 as the registration date to find eligible sukuk holders for the right of return.

The yield of 5.8% would be payable on the face value of Tk 100 sukuk each.

Earlier on July 8, 2021, the BSEC gave approval to BEXIMCO to issue Tk 3,000 crore of green Shariah compliant sukuk and the sukuk debuted on January 13 this year.

Beximco Green Sukuk al Istisna’a is issued by Beximco Green-Sukuk Trust as a Shariah-compliant asset-backed security and the subscription proceeds will be used for the solar projects of Teesta Solar Ltd and Korotoa Solar Ltd.

The validity period of the Green Sukuk is five years or 60 months from the date of issue.

The nominal value of each Sukuk is 100 Tk and the minimum subscription is 5,000 Tk or 50 green Sukuk.

The rate of return on Sukuk is 9% plus margin. The margin will be 10% of the difference between the base rate (9%) and the annual dividend rate declared by BEXIMCO Limited.

Profit from Beximco’s Sukuk will be paid on a semi-annual basis.

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Finolex Cables Limited (NSE:FINCABLES) Shares on a Bullish Trend: Are Strong Financials Driving the Market? https://www.localcollectorspost.org/finolex-cables-limited-nsefincables-shares-on-a-bullish-trend-are-strong-financials-driving-the-market/ Fri, 03 Jun 2022 01:17:31 +0000 https://www.localcollectorspost.org/finolex-cables-limited-nsefincables-shares-on-a-bullish-trend-are-strong-financials-driving-the-market/

Most readers will already know that Finolex Cables (NSE: FINCABLES) stock is up a significant 13% over the past week. Given the company’s impressive performance, we decided to take a closer look at its financial metrics, as a company’s long-term financial health usually dictates market outcomes. In this article, we have decided to focus on the ROE of Finolex Cables.

Return on equity or ROE is an important factor for a shareholder to consider as it tells them how much of their capital is being reinvested. In other words, it is a profitability ratio that measures the rate of return on capital contributed by the company’s shareholders.

Check out our latest analysis for Finolex cables

How is ROE calculated?

The ROE formula is:

Return on equity = Net income (from continuing operations) ÷ Equity

So, based on the above formula, the ROE for Finolex Cables is:

15% = ₹6.0 billion ÷ ₹39 billion (based on the last twelve months to March 2022).

The “yield” is the profit of the last twelve months. One way to conceptualize this is that for every ₹1 of share capital it has, the company has made a profit of ₹0.15.

What does ROE have to do with earnings growth?

So far we have learned that ROE is a measure of a company’s profitability. Depending on how much of those earnings the company reinvests or “keeps”, and how efficiently it does so, we are then able to gauge a company’s earnings growth potential. Assuming all else is equal, companies that have both a higher return on equity and better earnings retention are generally the ones with a higher growth rate compared to companies that don’t. same characteristics.

A Side-by-Side Comparison of Finolex Cables Earnings Growth and 15% ROE

For starters, Finolex Cables’ ROE looks acceptable. Compared to the industry average ROE of 10%, the company’s ROE looks quite remarkable. This likely laid the foundation for Finolex Cables’ moderate 8.7% net income growth seen over the past five years.

We then performed a comparison of Finolex Cables’ net income growth with the industry, which revealed that the company’s growth is similar to the average industry growth of 7.6% over the same period.

NSEI: FINCABLES Past Earnings Growth June 3, 2022

Earnings growth is an important factor in stock valuation. What investors then need to determine is whether the expected earnings growth, or lack thereof, is already priced into the stock price. This then helps them determine if the stock is positioned for a bright or bleak future. A good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings outlook. Thus, you might want to check whether Finolex Cables is trading on a high P/E or a low P/E, relative to its industry.

Does Finolex Cables use its profits efficiently?

Finolex Cables has a low three-year median payout ratio of 18%, which means the company keeps the remaining 82% of its earnings. This suggests that the management reinvests most of the profits to grow the business.

Moreover, Finolex Cables has paid dividends over a period of at least ten years, which means that the company is quite serious about sharing its profits with shareholders. After reviewing the latest analyst consensus data, we found that the company is expected to continue to pay out about 16% of its earnings over the next three years. As a result, the company’s future ROE is also not expected to change much, with analysts predicting an ROE of 15%.

Conclusion

Overall, we are quite satisfied with the performance of Finolex Cables. In particular, it is good to see that the company is investing heavily in its business and, along with a high rate of return, this has resulted in significant growth in its profits. That said, the company’s earnings growth is expected to slow, as expected in current analyst estimates. Are these analyst expectations based on general industry expectations or company fundamentals? Click here to access our analyst forecast page for the company.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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