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
7.0% = 5.1% × 0.62 × 2.23
Latest: FY2026
Profitability
Net Margin
5.1%
22.8% →5.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.62x
0.66x →0.62x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.23x
1.74x →2.23x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 19.2 pp over 5 years. Driven by net margin declining (22.8% → 5.1%), leverage rising (1.74x → 2.23x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 22.8% | 0.66 | 1.74 | 26.3% |
| FY2023 | ₹0Cr | ₹0Cr | 8.4% | 0.76 | 1.74 | 11.1% |
| FY2024 | ₹0Cr | ₹0Cr | 6.7% | 0.61 | 1.91 | 7.9% |
| FY2025 | ₹0Cr | ₹0Cr | 4.5% | 0.65 | 1.98 | 5.9% |
| FY2026 | ₹0Cr | ₹0Cr | 5.1% | 0.62 | 2.23 | 7.0% |
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.