DuPont Decomposition
Why does HATSUN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.2% = 3.2% × 1.78 × 2.83
Latest: FY2025
Profitability
Net Margin
3.2%
1.4% →3.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.78x
0.48x →1.78x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.83x
2.60x →2.83x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 14.5 pp over 3 years. Driven by net margin improving (1.4% → 3.2%), asset turnover improving (0.48x → 1.78x), leverage rising (2.60x → 2.83x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 1.4% | 0.48 | 2.60 | 1.7% |
| FY2024 | ₹0Cr | ₹0Cr | 2.5% | 0.43 | 3.01 | 3.3% |
| FY2025 | ₹0Cr | ₹0Cr | 3.2% | 1.78 | 2.83 | 16.2% |
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.