DuPont Decomposition
Why does AHLUCONT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.2% = 5.0% × 1.10 × 2.06
Latest: FY2025
Profitability
Net Margin
5.0%
5.8% →5.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.10x
1.31x →1.10x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.06x
1.98x →2.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.8 pp over 4 years. Driven by asset turnover declining (1.31x → 1.10x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.8% | 1.31 | 1.98 | 15.0% |
| FY2023 | ₹0Cr | ₹0Cr | 6.9% | 1.13 | 2.03 | 15.8% |
| FY2024 | ₹0Cr | ₹0Cr | 9.8% | 1.20 | 2.00 | 23.4% |
| FY2025 | ₹0Cr | ₹0Cr | 5.0% | 1.10 | 2.06 | 11.2% |
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.