DuPont Decomposition
Why does HARRMALAYA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.7% = 3.1% × 1.03 × 3.06
Latest: FY2025
Profitability
Net Margin
3.1%
5.2% →3.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.03x
1.07x →1.03x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.06x
3.04x →3.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.1 pp over 4 years. Driven by net margin declining (5.2% → 3.1%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.2% | 1.07 | 3.04 | 16.7% |
| FY2023 | ₹0Cr | ₹0Cr | 3.9% | 1.03 | 2.85 | 11.4% |
| FY2024 | ₹0Cr | ₹-0Cr | -1.6% | 0.99 | 3.22 | -5.1% |
| FY2025 | ₹0Cr | ₹0Cr | 3.1% | 1.03 | 3.06 | 9.7% |
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.