In today’s volatile market environment, companies with strong fundamentals, high capital efficiency, and zero debt offer a compelling case for resilient investing. A key indicator of such strength is Return on Capital Employed (ROCE), with a higher ROCE signifying more effective capital utilization for generating profits. When combined with a debt-free balance sheet, it underscores financial discipline and reduced vulnerability to interest rate fluctuations.
Notably, Coromandel International, Dr. Lal PathLabs, and Gillette India stand out in this regard each maintaining a ROCE above 20%, minimal to no debt, and consistent performance in profitability and operations. These qualities make them attractive candidates for long-term investors.
Coromandel International (CMP – Rs.2,233.7)
Coromandel International Ltd is one of India’s leading agri solutions providers. It offers a diverse range of products and services across the farming value chain. It specializes in fertilizers, crop protein, bio pesticide, specialty nutrients, organic fertilizers, etc.
The company’s business is divided among 2 main segments i.e. nutrient and other allied products (approx 85% of revenues) and crop protection (approx 15% of revenues)
It currently has a market capitalization of Rs. 67,008 crore, with a strong Return on Capital Employed (ROCE) of 24.1% and a Return on Equity (ROE) of 17.5%, indicating efficient use of capital and healthy profitability.
Coromandel International Ltd reported a robust financial performance for FY25, with revenue from operations rising 9% year-on-year to Rs. 24,085 crore. The company posted a 10% increase in EBITDA to Rs. 2,628 crore and a 25% jump in profit after tax to Rs. 2,055 crore. Notably, the basic EPS surged by 26% to Rs. 70.23, reflecting improved profitability and earnings efficiency.
Importantly, the company maintained a net debt-to-equity ratio of zero, underscoring its strong financial discipline and debt-free status. Overall, Coromandel’s growth momentum and capital efficiency continue to position it as a fundamentally strong player in the agri-inputs space.
Dr. Lal PathLabs (CMP- Rs. 2,849 )
Dr. Lal PathLabs Limited is a prominent name in India’s consumer healthcare space, specializing in diagnostic services. The company operates a comprehensive nationwide network that offers a wide array of diagnostic and healthcare tests catering to core testing, disease diagnosis, prevention, monitoring, and treatment. Its services are designed for individual patients, hospitals, healthcare institutions, and corporate clients.
The company holds a market capitalization of Rs. 23,259 crore, showcasing strong financial efficiency with a Return on Capital Employed (ROCE) of 28.9% and a Return on Equity (ROE) of 24.3%.
Dr. Lal PathLabs reported a strong performance for FY25, with revenue increasing by 10.5% to Rs. 2,461 crore from Rs. 2,227 crore in FY24. EBITDA grew 14.2% to Rs. 696 crore, while reported profit after tax (PAT) surged by 35.9% to Rs. 492 crore.
Operationally, the company served 28.8 million patients and processed 85.6 million samples, both showing year-on-year growth. Additionally, its SwasthFit wellness offering contributed 24% to revenue, up from 22% the previous year. These results underscore the company’s consistent growth momentum in India’s diagnostics sector.
Gillette India( CMP- Rs. 10,689)
Gillette India Limited is engaged in the manufacturing and selling of packaged fast moving goods under its various brands in the grooming and oral care segment. Gillette sells razors and blades, shaving gel, shaving cream, and after shave through various modes like drug stores, department stores, grocery stores, mass merchandisers, and many others.
The company boasts a robust market capitalization of Rs. 34,812 crore. It demonstrates strong financial efficiency with an impressive Return on Capital Employed (ROCE) of 58.9% and a high Return on Equity (ROE) of 42.5%, indicating effective use of capital and strong shareholder returns.
The company delivered a solid performance for FY 2024–25, reporting a 12% increase in sales and a 40% rise in profit after tax (PAT). Notably, these results reflect growth over a 9-month fiscal period, following a shift in the company’s financial year from July–June to April–March. The strong year-on-year growth highlights P&G’s resilience and effective execution during the transition.
Over the past 10 years, the company has showcased consistent growth and operational excellence. The company reported a 5% CAGR in net sales and an impressive 19% CAGR in profit after tax (PAT). Notably, its Return on Equity (ROE) surged 4 times, reflecting strong profitability and efficient capital use underscoring resilience and value creation for shareholders.
Written by Manideep Appana
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