DuPont Decomposition
Why does AFCONS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.6% = 2.1% × 0.62 × 3.51
Latest: FY2026
Profitability
Net Margin
2.1%
3.3% →2.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.62x
0.84x →0.62x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.51x
4.78x →3.51x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.5 pp over 5 years. Driven by net margin declining (3.3% → 2.1%), asset turnover declining (0.84x → 0.62x), leverage falling (4.78x → 3.51x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.3% | 0.84 | 4.78 | 13.1% |
| FY2023 | ₹0Cr | ₹0Cr | 3.3% | 0.88 | 4.50 | 12.9% |
| FY2024 | ₹0Cr | ₹0Cr | 3.4% | 0.81 | 4.51 | 12.5% |
| FY2025 | ₹0Cr | ₹0Cr | 3.9% | 0.73 | 3.25 | 9.3% |
| FY2026 | ₹0Cr | ₹0Cr | 2.1% | 0.62 | 3.51 | 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.