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
9.3% = 3.9% × 0.73 × 3.25
Latest: FY2025
Profitability
Net Margin
3.9%
3.3% →3.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.73x
0.84x →0.73x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.25x
4.80x →3.25x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.9 pp over 4 years. Driven by asset turnover declining (0.84x → 0.73x), leverage falling (4.80x → 3.25x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.3% | 0.84 | 4.80 | 13.2% |
| 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% |
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.