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If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we’ll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, an expanding base of capital employed. Put simply, these types of businesses are compounding machines, meaning they are continually reinvesting their earnings at ever-higher rates of return. With that in mind, we’ve noticed some promising trends at WCE Holdings Berhad (KLSE:WCEHB) so let’s look a bit deeper.

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If you haven’t worked with ROCE before, it measures the ‘return’ (pre-tax profit) a company generates from capital employed in its business. The formula for this calculation on WCE Holdings Berhad is:

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

0.012 = RM90m ÷ (RM8.2b – RM958m) (Based on the trailing twelve months to June 2025).

So, WCE Holdings Berhad has an ROCE of 1.2%. Ultimately, that’s a low return and it under-performs the Infrastructure industry average of 6.1%.

Check out our latest analysis for WCE Holdings Berhad

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 want to delve into the historical earnings , check out these free graphs detailing revenue and cash flow performance of WCE Holdings Berhad.

Even though ROCE is still low in absolute terms, it’s good to see it’s heading in the right direction. Over the last five years, returns on capital employed have risen substantially to 1.2%. 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 37%. So we’re very much inspired by what we’re seeing at WCE Holdings Berhad thanks to its ability to profitably reinvest capital.

All in all, it’s terrific to see that WCE Holdings Berhad is reaping the rewards from prior investments and is growing its capital base. Since the stock has returned a staggering 191% to shareholders over the last five years, it looks like investors are recognizing these changes. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence.

One more thing, we’ve spotted 2 warning signs facing WCE Holdings Berhad that you might find interesting.

For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

For September, retail sales, a key gauge of consumption, likely grew 3.0% on year, down from August’s 3.4% increase, the poll shows. Industrial production is estimated to have grown 5.3%, marginally above August’s 5.2%. Fixed-asset investment likely stayed flat in the first three quarters of the year, compared with a 0.5% rise through August. Property data due the same day are expected to show another weak month for the housing sector.

The People’s Bank of China will also announce the country’s benchmark lending rates on Monday, which are widely expected to remain unchanged.

Separately, China’s ruling communist elites are set to convene a meeting from Monday to Thursday to review the country’s 15th Five-Year Plan, mapping out key policy initiatives for the world’s second-largest economy for the rest of the decade. While detailed targets will be unveiled next March, economists at Morgan Stanley expect the focus to remain on “technological self-sufficiency, innovation and national security,” with limited market-moving surprises.

  Australia / New Zealand 

  In Australia, attention will be focused on further communication from the Reserve Bank of Australia. While senior officials have recently signaled more interest-rate cuts, they may start rowing back those comments after data showed unemployment jumped to its highest level since late 2021. 

  Even with inflation risks lingering, the rise in unemployment to 4.5% in September adds pressure on the RBA to keep lowering the official cash rate. The increase may reflect weaker government hiring and continued softness in the private sector, compounded by global trade uncertainty and China's tariff headwinds. 

  A speech by RBA Gov. Michele Bullock on Friday will be a key focus in an otherwise light data week. 

  In New Zealand, third-quarter inflation data on Monday will draw close attention. Policymakers appear increasingly attuned to signs of weakness, making further rate cuts all but certain. 

  Indonesia 

  Bank Indonesia is set to announce its policy decision on Wednesday and is widely expected to continue cutting interest rates to support growth. 

  UOB economist Enrico Tanuwidjaja thinks the easing cycle is not complete, but the end is near. He expects a 25-basis-point cut to 4.50% in October, followed by another reduction in the first quarter of 2026, with rates likely to remain steady through the year after that. 

  Malaysia 

  Malaysia's September inflation data is likely to show a small uptick in price pressures but not enough to move the needle for the central bank. 

  ANZ expects CPI to have edged up to 1.5% from 1.3% in August, driven by slightly higher utilities and transport costs. However, with the government reduction of fuel prices, transport inflation could ease in the coming months, ANZ said. 

  Overall, inflation is expected to stay subdued, supported by weak global commodity prices and moderating domestic demand. ANZ doesn't anticipate Bank Negara Malaysia to cut rates again soon unless growth weakens significantly. 

  South Korea 

  The Bank of Korea is expected to hold rates when the monetary policy board meets on Thursday, keeping policy settings unchanged for a third consecutive session. 

  Analysts have recently pushed back forecasts for the central bank to deliver a rate cut from October to November or later, citing continued financial stability risks tied to household debt and Seoul's overheated property market. Lower borrowing costs could further stoke mortgage lending, complicating the BOK's decision. 

  Goldman Sachs economists said the government's latest housing stabilization measures-tightening mortgage and property transaction rules-support the case for the BOK to hold rates in October while signaling a dovish bias for November. 

  The central bank may wait for home prices to stabilize before delivering another cut, Citigroup economist Jin-Wook Kim said. 

  Singapore 

  Singapore will release its September inflation data on Thursday. The central bank recently said core inflation, a measure excluding private road transport and accommodation, could bottom out soon and rise gradually in 2026. 

  Core inflation cooled to 0.3% on year in August from 0.5% in July. ANZ Research expects September to mark the low point of weak inflation, forecasting a 0.2% on-year rise in core prices and a 0.6% gain in headline inflation. 

  Any references to days are in local times. 

  Write to Jessica Fleetham at jessica.fleetham@wsj.com and Jihye Lee at jihye.lee@wsj.com 

  (END) Dow Jones Newswires

  October 19, 2025 20:14 ET (00:14 GMT)
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