DuPont Decomposition
Why does HIMATSEIDE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.7% = 3.0% × 0.45 × 2.78
Latest: FY2025
Profitability
Net Margin
3.0%
0.9% →3.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.45x
0.46x →0.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.78x
3.22x →2.78x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.5 pp over 3 years. Driven by net margin improving (0.9% → 3.0%), leverage falling (3.22x → 2.78x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.9% | 0.46 | 3.22 | 1.3% |
| FY2024 | ₹0Cr | ₹0Cr | 4.4% | 0.44 | 3.28 | 6.3% |
| FY2025 | ₹0Cr | ₹0Cr | 3.0% | 0.45 | 2.78 | 3.7% |
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.