Probe - Accounting, Auditing and Taxation

Analysis of the profitability of listed companies based on the DuPont analysis method—A case study of higold group

Yuqian Zhang

School of Management, Foshan University

Rong Tang

School of Management, Foshan University

DOI: https://doi.org/10.59429/paat.v8i3.15709

Keywords: DuPont analysis; higold group; profitability; asset turnover

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Abstract

This study examines Higold Group's profitability using financial disclosures for 2022–2025. DuPont decomposition and a comparison with Kinlong Hardware and Tute identify the main changes in margins, asset turnover, and shareholder returns. Higold's net profit margin increased throughout the period, supported by higher gross margins and changes in its product mix. In 2025, however, assets and equity expanded faster than earnings, reducing return on equity despite continued profit growth. Successive substitution attributes most of this decline to lower asset turnover. The findings suggest that the company's growing capital base requires closer attention to investment timing and asset use. Capacity expansion should follow demand, while financing decisions should reflect expected project cash flows and repayment requirements.

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