DuPont Decomposition
Why does AADHARHFC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.5% = 31.7% × 0.13 × 3.63
Latest: FY2026
Profitability
Net Margin
31.7%
27.6% →31.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.13x
0.11x →0.13x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.63x
4.57x →3.63x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~15%. Driven by net margin improving (27.6% → 31.7%), leverage falling (4.57x → 3.63x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 27.6% | 0.11 | 4.57 | 14.1% |
| FY2023 | ₹0Cr | ₹0Cr | 29.0% | 0.11 | 4.49 | 14.7% |
| FY2024 | ₹0Cr | ₹0Cr | 31.8% | 0.12 | 4.29 | 16.9% |
| FY2025 | ₹0Cr | ₹0Cr | 31.2% | 0.13 | 3.64 | 14.3% |
| FY2026 | ₹0Cr | ₹0Cr | 31.7% | 0.13 | 3.63 | 14.5% |
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.