DuPont Decomposition
Why does HERITGFOOD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.6% = 3.3% × 2.32 × 1.77
Latest: FY2026
Profitability
Net Margin
3.3%
3.6% →3.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.32x
2.97x →2.32x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.77x
1.37x →1.77x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.1 pp over 5 years. Driven by asset turnover declining (2.97x → 2.32x), leverage rising (1.37x → 1.77x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.6% | 2.97 | 1.37 | 14.7% |
| FY2023 | ₹0Cr | ₹0Cr | 1.8% | 2.88 | 1.55 | 8.0% |
| FY2024 | ₹0Cr | ₹0Cr | 2.8% | 2.96 | 1.59 | 13.2% |
| FY2025 | ₹0Cr | ₹0Cr | 4.5% | 2.65 | 1.60 | 19.4% |
| FY2026 | ₹0Cr | ₹0Cr | 3.3% | 2.32 | 1.77 | 13.6% |
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.