The Trend Of High Returns At Vishnusurya Projects and Infra (NSE:VISHNUINFR) Has Us Very Interested

Did you know there are some financial metrics that can provide clues of a potential multi-bagger? Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base 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. And in light of that, the trends we're seeing at Vishnusurya Projects and Infra's (NSE:VISHNUINFR) look very promising so lets take a look.

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Understanding Return On Capital Employed (ROCE)

Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. To calculate this metric for Vishnusurya Projects and Infra, this is the formula:

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

0.22 = ₹435m ÷ (₹3.0b - ₹1.0b) (Based on the trailing twelve months to March 2025).

So, Vishnusurya Projects and Infra has an ROCE of 22%. In absolute terms that's a great return and it's even better than the Basic Materials industry average of 6.4%.

See our latest analysis for Vishnusurya Projects and Infra

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 Vishnusurya Projects and Infra has performed in the past in other metrics, you can view this free graph of Vishnusurya Projects and Infra's past earnings, revenue and cash flow.

What Does the ROCE Trend For Vishnusurya Projects and Infra Tell Us?

Investors would be pleased with what's happening at Vishnusurya Projects and Infra. The numbers show that in the last four years, the returns generated on capital employed have grown considerably to 22%. The company is effectively making more money per dollar of capital used, and it's worth noting that the amount of capital has increased too, by 303%. The increasing returns on a growing amount of capital is common amongst multi-baggers and that's why we're impressed.

One more thing to note, Vishnusurya Projects and Infra has decreased current liabilities to 35% of total assets over this period, which effectively reduces the amount of funding from suppliers or short-term creditors. This tells us that Vishnusurya Projects and Infra has grown its returns without a reliance on increasing their current liabilities, which we're very happy with.

In Conclusion...

To sum it up, Vishnusurya Projects and Infra has proven it can reinvest in the business and generate higher returns on that capital employed, which is terrific. And since the stock has fallen 50% over the last year, there might be an opportunity here. With that in mind, we believe the promising trends warrant this stock for further investigation.

One final note, you should learn about the 4 warning signs we've spotted with Vishnusurya Projects and Infra (including 2 which don't sit too well with us) .

If you'd like to see other companies earning high returns, check out our free list of companies earning high returns with solid balance sheets here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.