DuPont Decomposition
Why does HLEGLAS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.4% = 4.6% × 0.79 × 2.33
Latest: FY2025
Profitability
Net Margin
4.6%
9.0% →4.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.79x
0.85x →0.79x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.33x
3.00x →2.33x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 14.5 pp over 4 years. Driven by net margin declining (9.0% → 4.6%), leverage falling (3.00x → 2.33x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 9.0% | 0.85 | 3.00 | 22.9% |
| FY2023 | ₹0Cr | ₹0Cr | 7.6% | 0.33 | 2.73 | 7.0% |
| FY2024 | ₹0Cr | ₹0Cr | 4.8% | 0.26 | 2.88 | 3.5% |
| FY2025 | ₹0Cr | ₹0Cr | 4.6% | 0.79 | 2.33 | 8.4% |
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.