DuPont Decomposition
Why does AAKASH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.0% = 1.9% × 1.02 × 1.60
Latest: FY2025
Profitability
Net Margin
1.9%
8.0% →1.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.02x
1.09x →1.02x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.60x
1.48x →1.60x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 9.8 pp over 4 years. Driven by net margin declining (8.0% → 1.9%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 8.0% | 1.09 | 1.48 | 12.8% |
| FY2023 | ₹0Cr | ₹0Cr | 4.9% | 1.11 | 1.59 | 8.7% |
| FY2024 | ₹0Cr | ₹0Cr | 6.7% | 0.98 | 1.60 | 10.6% |
| FY2025 | ₹0Cr | ₹0Cr | 1.9% | 1.02 | 1.60 | 3.0% |
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.