DuPont Decomposition
Why does AEROFLEX earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.3% = 14.3% × 0.86 × 1.25
Latest: FY2025
Profitability
Net Margin
14.3%
11.8% →14.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.86x
1.27x →0.86x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.25x
2.13x →1.25x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 16.6 pp over 4 years. Driven by net margin improving (11.8% → 14.3%), asset turnover declining (1.27x → 0.86x), leverage falling (2.13x → 1.25x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.8% | 1.27 | 2.13 | 31.9% |
| FY2023 | ₹0Cr | ₹0Cr | 11.5% | 1.23 | 1.88 | 26.4% |
| FY2024 | ₹0Cr | ₹0Cr | 13.1% | 0.85 | 1.28 | 14.2% |
| FY2025 | ₹0Cr | ₹0Cr | 14.3% | 0.86 | 1.25 | 15.3% |
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.