DuPont Decomposition
Why does AARTIIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.9% = 4.6% × 0.64 × 1.98
Latest: FY2025
Profitability
Net Margin
4.6%
9.0% →4.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.64x
0.19x →0.64x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.98x
1.74x →1.98x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.9 pp over 3 years. Driven by net margin declining (9.0% → 4.6%), asset turnover improving (0.19x → 0.64x), leverage rising (1.74x → 1.98x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.0% | 0.19 | 1.74 | 3.0% |
| FY2024 | ₹0Cr | ₹0Cr | 7.4% | 0.18 | 1.82 | 2.5% |
| FY2025 | ₹0Cr | ₹0Cr | 4.6% | 0.64 | 1.98 | 5.9% |
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.