DuPont Decomposition
Why does ADVANIHOTR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.6% = 22.4% × 0.20 × 1.06
Latest: FY2026
Profitability
Net Margin
22.4%
13.4% →22.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.20x
0.65x →0.20x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.06x
1.50x →1.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.4 pp over 5 years. Driven by net margin improving (13.4% → 22.4%), asset turnover declining (0.65x → 0.20x), leverage falling (1.50x → 1.06x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 13.4% | 0.65 | 1.50 | 13.1% |
| FY2023 | ₹0Cr | ₹0Cr | 31.2% | 1.02 | 1.43 | 45.6% |
| FY2024 | ₹0Cr | ₹0Cr | 25.8% | 0.97 | 1.39 | 34.7% |
| FY2025 | ₹0Cr | ₹0Cr | 24.6% | 1.00 | 1.32 | 32.5% |
| FY2026 | ₹0Cr | ₹0Cr | 22.4% | 0.20 | 1.06 | 4.6% |
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.