A high Return on Capital Employed (ROCE) indicates that a company is using its capital efficiently to generate strong profits. It reflects effective management and the company’s ability to earn attractive returns from both equity and debt investments. In simple terms, a higher ROCE means the business is making good use of its resources. We have highlighted six large-cap stocks with over 50% ROCE in FY25, according to StocksEdge’s Profitable Scan data.
ROCE = (Earnings Before Interest and Tax / Capital Employed) × 100. EBIT is the company’s Earnings Before Interest and Taxes, and Capital Employed is the total capital used to generate profits, often calculated as Total Assets – Current Liabilities.