DuPont Decomposition
Why does HECPROJECT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
17.4% = 8.3% × 1.06 × 2.00
Latest: FY2025
Profitability
Net Margin
8.3%
1.2% →8.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.06x
0.53x →1.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.00x
2.79x →2.00x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.6 pp over 4 years. Driven by net margin improving (1.2% → 8.2%), asset turnover improving (0.53x → 1.06x), leverage falling (2.79x → 2.00x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.2% | 0.53 | 2.79 | 1.8% |
| FY2023 | ₹0Cr | ₹0Cr | 1.5% | 0.61 | 2.81 | 2.6% |
| FY2024 | ₹0Cr | ₹0Cr | 6.4% | 0.93 | 2.27 | 13.5% |
| FY2025 | ₹0Cr | ₹0Cr | 8.3% | 1.06 | 2.00 | 17.4% |
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.