DuPont Decomposition
Why does ADOR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.8% = 5.4% × 1.61 × 1.37
Latest: FY2025
Profitability
Net Margin
5.4%
7.7% →5.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.61x
1.71x →1.61x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.40x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 6.5 pp over 3 years. Driven by net margin declining (7.7% → 5.4%).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.7% | 1.71 | 1.40 | 18.3% |
| FY2024 | ₹0Cr | ₹0Cr | 8.1% | 2.05 | 1.44 | 23.9% |
| FY2025 | ₹0Cr | ₹0Cr | 5.4% | 1.61 | 1.37 | 11.8% |
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.