DuPont Decomposition
Why does AIAENG earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.3% = 25.0% × 0.54 × 1.13
Latest: FY2025
Profitability
Net Margin
25.0%
21.5% →25.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.54x
0.74x →0.54x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.13x
1.17x →1.13x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.3 pp over 3 years. Driven by net margin improving (21.5% → 25.0%), asset turnover declining (0.74x → 0.54x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 21.5% | 0.74 | 1.17 | 18.6% |
| FY2024 | ₹0Cr | ₹0Cr | 23.4% | 0.65 | 1.13 | 17.1% |
| FY2025 | ₹0Cr | ₹0Cr | 25.0% | 0.54 | 1.13 | 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.