DuPont Decomposition
Why does HINDCON earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.7% = 5.0% × 0.85 × 1.34
Latest: FY2026
Profitability
Net Margin
5.0%
6.3% →5.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.85x
1.27x →0.85x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.34x
1.34x →1.34x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 5.2 pp over 5 years. Driven by net margin declining (6.3% → 5.0%), asset turnover declining (1.27x → 0.85x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.3% | 1.27 | 1.34 | 10.8% |
| FY2023 | ₹0Cr | ₹0Cr | 5.0% | 1.60 | 1.27 | 10.2% |
| FY2024 | ₹0Cr | ₹0Cr | 9.6% | 1.08 | 1.19 | 12.4% |
| FY2025 | ₹0Cr | ₹0Cr | 6.7% | 0.89 | 1.18 | 7.0% |
| FY2026 | ₹0Cr | ₹0Cr | 5.0% | 0.85 | 1.34 | 5.7% |
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.