Hindustan Unilever Key Ratios

The declining PAT margin from 17.00% to 16.60% signifies challenges in pricing power or rising costs, contributing negatively to ROE.Asset turnover has fluctuated, peaking at 1.19 but declining to 0.93, suggesting efficiency issues in managing assets to generate sales.Leverage has remained relatively stable around 1.49, indicating a consistent reliance on debt to fuel returns, offsetting declines in profitability and efficiency.

Inventory days increased from 22 to 24, indicating slower inventory turnover but improved to 21 by 2024, suggesting better stock management.Receivable days rose from 10 to 15.73, signaling potential issues in cash collection, which may affect liquidity.Payable days decreased sharply to 118, then spiked to 135, showing variability in supplier payment practices that could strain cash flow.

ROE has shown a declining trend, dropping from 28.63% to 20.26%, driven primarily by lower profit margins despite stable leverage.ROCE indicates capital efficiency concerns with a drop from 38.36% to 28.06%, showing diminishing returns on capital employed, likely due to reduced sales margins.ROA reflects overall asset efficiency, decreasing from 18.06% to 13.57%, highlighting the deterioration in asset utilization alongside falling profits.