DuPont Decomposition
Why does ABBOTINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
33.4% = 22.1% × 1.08 × 1.40
Latest: FY2025
Profitability
Net Margin
22.1%
16.3% →22.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.08x
1.16x →1.08x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.40x
1.50x →1.40x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 5.1 pp over 4 years. Driven by net margin improving (16.3% → 22.1%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 16.3% | 1.16 | 1.50 | 28.3% |
| FY2023 | ₹0Cr | ₹0Cr | 17.8% | 1.17 | 1.43 | 29.8% |
| FY2024 | ₹0Cr | ₹0Cr | 20.5% | 1.13 | 1.40 | 32.5% |
| FY2025 | ₹0Cr | ₹0Cr | 22.1% | 1.08 | 1.40 | 33.4% |
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.