DuPont Decomposition
Why does HMAAGRO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.7% = 1.7% × 3.00 × 2.11
Latest: FY2025
Profitability
Net Margin
1.7%
3.8% →1.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
3.00x
3.60x →3.00x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.11x
2.18x →2.11x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 19.3 pp over 4 years. Driven by net margin declining (3.8% → 1.7%), asset turnover declining (3.60x → 3.00x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.8% | 3.60 | 2.18 | 30.0% |
| FY2023 | ₹0Cr | ₹0Cr | 3.8% | 3.21 | 2.11 | 25.4% |
| FY2024 | ₹0Cr | ₹0Cr | 2.1% | 3.34 | 2.01 | 14.0% |
| FY2025 | ₹0Cr | ₹0Cr | 1.7% | 3.00 | 2.11 | 10.7% |
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.