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Hang Lung ROIC

What is the ROIC of Hang Lung?

The ROIC of Hang Lung Group Limited is 4.61%

What is the definition of ROIC?



Return on invested capital (ROIC) is a financial ratio that measures how efficient a company is at allocating the capital under its control to profitable investments.

= NOPAT / Invested capital = EBIT * (1 - tax rate) / (2-year average liabilities + 2-year average shareholder equity)

Return on invested capital (ROIC) ratio gives investors a sense of how well a company is using money under its control to generate profitable returns.

ROIC can be used as a benchmark to calculate the valuation of companies across industries. A higher ROIC means the company is doing a better job of investing the money from shareholders and bondholders to run the business. A company is creating value if its ROIC exceeds 2%. If its ROIC is under 2%, the company is likely destroying value and has no excess capital to invest in future growth.

You can calculate ROIC with the following formula:


NOPAT = Net operating profit after tax
Invested Capital = Average total liabilities + Average shareholders' equity

The averages of liabilities and shareholders' equity are calculated as geometrical averages of the last two annual values from the company's balance sheet.

ROIC of companies in the Real Estate sector on HKSE compared to Hang Lung

What does Hang Lung do?

Hang Lung Group Limited, an investment holding company, operates as a property developer in Hong Kong and Mainland China. The company operates through Property Leasing and Property Sales segments. It develops properties for sale and lease, such as large-scale commercial, office, and residential developments. The company also develops various properties, including shopping mall, office, residential, serviced apartments, and carparks. Its investment properties portfolio includes Grand Gateway 66, a commercial, office, and residential complex, as well as Plaza 66, a commercial and office complex in Shanghai; Palace 66 and Forum 66 in Shenyang; Parc 66 in Jinan; Center 66 in Wuxi; Riverside 66 in Tianjin; Olympia 66 in Dalian; Spring City 66 in Kunming; Heartland 66 in Wuhan; and Westlake 66. In addition, the company offers car park and property management, securities trading, financial, project management, and property agency services, as well as operates and manages apartment. Hang Lung Group Limited was incorporated in 1960 and is headquartered in Central, Hong Kong.

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