DuPont Decomposition

Why does HCC earn its ROE?

Breaking down Return on Equity into profitability, efficiency, and leverage.

ROE = Net Margin × Asset Turnover × Equity Multiplier

12.4% = 2.1% × 0.67 × 8.93

Latest: FY2025

Profitability

Net Margin

2.1%

2.1% →2.1%

How much profit per ₹ of revenue

Efficiency

Asset Turnover

0.67x

0.67x →0.67x

Revenue per ₹ of assets

Leverage

Equity Multiplier

8.93x

8.93x →8.93x

Assets funded by equity vs debt

Historical Decomposition

Last 1 years

YearRevenuePATNet MarginAsset TOLeverageROE
FY2025₹0Cr₹0Cr2.1%0.678.9312.4%

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)

See DCF fair value for HCC

Combine financial quality with intrinsic value.

See Fair Value →

DuPont decomposition from audited annual financials. Factual analysis, not investment advice.