DuPont Decomposition
Why does ASIANHOTNR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
71.4% = 58.9% × 0.21 × 5.89
Latest: FY2025
Profitability
Net Margin
58.9%
-6.2% →58.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.21x
0.05x →0.21x
Revenue per ₹ of assets
Leverage
Equity Multiplier
5.89x
9.68x →5.89x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 74.2 pp over 3 years. Driven by net margin improving (-6.2% → 58.9%), asset turnover improving (0.05x → 0.21x), leverage falling (9.68x → 5.89x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -6.2% | 0.05 | 9.68 | -2.8% |
| FY2024 | ₹0Cr | ₹-0Cr | -18.2% | 0.05 | 22.73 | -20.3% |
| FY2025 | ₹0Cr | ₹0Cr | 58.9% | 0.21 | 5.89 | 71.4% |
How to read DuPont
- • Rising ROE from margin = pricing power, operational improvement (good)
- • Rising ROE from turnover = better asset utilization (good)
- • Rising ROE from leverage = more debt, amplified risk (caution)
- • Falling ROE across all three = structural deterioration (red flag)
DuPont decomposition from audited annual financials. Factual analysis, not investment advice.