DuPont Decomposition
Why does AARTIPHARM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.7% = 13.1% × 0.72 × 1.46
Latest: FY2025
Profitability
Net Margin
13.1%
10.3% →13.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.72x
0.58x →0.72x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.46x
1.47x →1.46x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.9 pp over 4 years. Driven by net margin improving (10.3% → 13.1%), asset turnover improving (0.58x → 0.72x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 10.3% | 0.58 | 1.47 | 8.8% |
| FY2023 | ₹0Cr | ₹0Cr | 8.8% | 0.22 | 1.43 | 2.8% |
| FY2024 | ₹0Cr | ₹0Cr | 12.9% | 0.20 | 1.47 | 3.7% |
| FY2025 | ₹0Cr | ₹0Cr | 13.1% | 0.72 | 1.46 | 13.7% |
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.