DuPont Decomposition
Why does HILTON earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
2.3% = 1.5% × 0.98 × 1.56
Latest: FY2026
Profitability
Net Margin
1.5%
2.1% →1.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.98x
0.73x →0.98x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.56x
2.54x →1.56x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.7 pp over 5 years. Driven by asset turnover improving (0.73x → 0.98x), leverage falling (2.54x → 1.56x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.1% | 0.73 | 2.54 | 3.9% |
| FY2023 | ₹0Cr | ₹0Cr | 5.6% | 0.62 | 1.90 | 6.6% |
| FY2024 | ₹0Cr | ₹0Cr | 4.8% | 0.75 | 1.85 | 6.7% |
| FY2025 | ₹0Cr | ₹0Cr | 3.8% | 0.74 | 1.91 | 5.3% |
| FY2026 | ₹0Cr | ₹0Cr | 1.5% | 0.98 | 1.56 | 2.3% |
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.