DuPont Decomposition
Why does HEXT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.7% = 10.2% × 1.23 × 1.73
Latest: FY2026
Profitability
Net Margin
10.2%
9.6% →10.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.23x
1.41x →1.23x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.73x
1.58x →1.73x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~22%. Driven by asset turnover declining (1.41x → 1.23x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.6% | 1.41 | 1.58 | 21.4% |
| FY2024 | ₹0Cr | ₹0Cr | 9.6% | 1.44 | 1.55 | 21.5% |
| FY2025 | ₹0Cr | ₹0Cr | 10.2% | 0.35 | 1.68 | 6.0% |
| FY2026 | ₹0Cr | ₹0Cr | 10.2% | 1.23 | 1.73 | 21.7% |
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.