DuPont Decomposition
Why does HINDPETRO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.2% = 1.6% × 2.22 × 3.81
Latest: FY2025
Profitability
Net Margin
1.6%
3.1% →1.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.22x
0.71x →2.22x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.81x
5.00x →3.81x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.0 pp over 3 years. Driven by net margin declining (3.1% → 1.6%), asset turnover improving (0.71x → 2.22x), leverage falling (5.00x → 3.81x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.1% | 0.71 | 5.00 | 11.2% |
| FY2024 | ₹0Cr | ₹0Cr | 2.2% | 0.67 | 3.90 | 5.8% |
| FY2025 | ₹0Cr | ₹0Cr | 1.6% | 2.22 | 3.81 | 13.2% |
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.