DuPont Decomposition
Why does ABSLAMC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
25.0% = 55.2% × 0.41 × 1.10
Latest: FY2025
Profitability
Net Margin
55.2%
45.6% →55.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.41x
0.11x →0.41x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.10x
1.11x →1.10x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 19.6 pp over 3 years. Driven by net margin improving (45.6% → 55.2%), asset turnover improving (0.11x → 0.41x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 45.6% | 0.11 | 1.11 | 5.4% |
| FY2024 | ₹0Cr | ₹0Cr | 57.5% | 0.10 | 1.10 | 6.5% |
| FY2025 | ₹0Cr | ₹0Cr | 55.2% | 0.41 | 1.10 | 25.0% |
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.