Return on equity (ROE) is a financial term that assesses how well a firm earns returns from its owner’s capital. It is determined by dividing net income by shareholder’s equity and presented as a percentage.

A high ROE shows that a business is effectively allocating investor funds to create significant profits. A low ROE shows that management should make better use of shareholders’ assets. 

However, it is critical to remember that ROE should only be compared within the same industry, as various sectors often have different average ROE ranges owing to varied business structures and capital requirements.

1. Jai Balaji Industries Limited

Jai Balaji Industries is an integrated iron and steel manufacturer with eight manufacturing units across West Bengal, Chhattisgarh, Orissa, and Jharkhand. The company produces various steel products, including sponge iron, pig iron, ferroalloys, billets, TMT bars, wire rods, and ductile iron pipes.

With a market capitalization of Rs. 17,715 crores, Jai Balaji Industries Limited’s share price traded at Rs. 971 per share on Friday, down around 3.43 percent compared to its previous close.

In terms of return ratio, the company’s return on equity should be 90.2 percent, and the return on capital employed should be 63.6 percent.

Jai Balaji Industries Limited’s revenue from operations has increased by 4.72 percent, from Rs. 6,125 crore in FY23 to Rs. 6,414 crore in FY24. The net profit of the company has improved from Rs 58 crore in FY23 to Rs 880 crore in FY24, which has increased by 1417.24 percent.

2. Schneider Electric Infrastructure Limited

Schneider Electric Infrastructure is an Indian company specializing in manufacturing advanced electrical distribution products and systems. The company’s portfolio includes distribution transformers, medium voltage switchgear, protection relays, and automation equipment. 

With a market capitalization of Rs. 17,632 crores, Schneider Electric Infrastructure Limited’s share price traded at Rs. 737 per share on Friday, down around 3 percent compared to its previous close.

In terms of return ratio, the company’s return on equity should be 126 percent, and the return on capital employed should be 37 percent.

Schneider Electric Infrastructure Limited’s revenue from operations has increased by 24.2 percent, from Rs. 1,777 crore in FY23 to Rs. 2,207 crore in FY24. The net profit of the company has improved from Rs 124 crore in FY23 to Rs 172 crore in FY24, which has increased by 38.71 percent.

3. Waaree Renewables Technologies Limited

Waaree Renewable Technologies is an Indian EPC company focused on solar energy solutions. The company develops, finances, constructs, and operates solar projects, including rooftop, ground-mounted, and floating solar installations. It offers both CAPEX and RESCO business models, providing end-to-end solar solutions from installation to maintenance. 

With a market capitalization of Rs. 14,855 crores, Waaree Renewables Technologies Limited’s share price traded at Rs. 1,425 per share on Friday, down around 3.60 percent compared to its previous close.

In terms of return ratio, the company’s return on equity should be 80.2 percent, and the return on capital employed should be 107 percent.

Waaree Renewables Technologies Limited’s revenue from operations has increased by 153.51 percent, from Rs. 342 crore in FY23 to Rs. 867 crore in FY24. The net profit of the company has improved from Rs 59 crore in FY23 to Rs 149 crore in FY24, which has increased by 150.85 percent.

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4. Sahasra Electronic Solutions Limited

Sahasra Electronic Solutions Limited (SESL) is a prominent player in the Indian electronics system design and manufacturing sector, established in 2000. The company specializes in a wide array of services, including printed circuit board (PCB) fabrication, electronic manufacturing services (EMS), consumer and enterprise IT hardware, semiconductor packaging, and smart LED lighting.

With a market capitalization of Rs. 2,350 crores, Sahasra Electronic Solutions Limited’s share price closed at Rs. 940 per share on Friday, down around 3.87 percent compared to its previous close.

In terms of return ratio, the company’s return on equity should be 81 percent, and the return on capital employed should be 65 percent.

Sahasra Electronic Solutions Limited’s revenue from operations has increased by 910 percent, from Rs. 10 crore in FY23 to Rs. 101 crore in FY24. The net profit of the company has improved from Rs 2 crore in FY23 to Rs 33 crore in FY24, which has increased by 1550 percent.

5. Mishtann Foods Limited

Mishtann Foods Limited specializes in manufacturing and processing premium rice varieties and food grains. The company produces diverse basmati rice brands, including Snowflake, Pristino, and Jacinth in various pack sizes. The company processes essential commodities like wheat, dal, and rock salt for nationwide distribution.

With a market capitalization of Rs. 1,524 crores, Mishtann Foods Limited’s share price traded at Rs. 14.1 per share on Friday, down around 084 percent compared to its previous close.

In terms of return ratio, the company’s return on equity should be 98.7 percent, and the return on capital employed should be 88.7 percent.

Mishtann Foods Limited’s revenue from operations has increased by 98.15 percent, from Rs. 650 crore in FY23 to Rs. 1,288 crore in FY24. The net profit of the company has improved from Rs 50 crore in FY23 to Rs 346 crore in FY24, which has increased by 592 percent.

Written by – Nikhil Naik

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