DuPont Decomposition
Why does AKG earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
0.7% = 0.4% × 1.41 × 1.16
Latest: FY2026
Profitability
Net Margin
0.4%
1.0% →0.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.41x
4.14x →1.41x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.16x
1.95x →1.16x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.7 pp over 5 years. Driven by asset turnover declining (4.14x → 1.41x), leverage falling (1.95x → 1.16x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.0% | 4.14 | 1.95 | 8.4% |
| FY2023 | ₹0Cr | ₹0Cr | 1.2% | 3.05 | 1.42 | 5.0% |
| FY2024 | ₹0Cr | ₹0Cr | 0.9% | 2.33 | 1.50 | 3.0% |
| FY2025 | ₹0Cr | ₹0Cr | 0.6% | 1.69 | 1.49 | 1.6% |
| FY2026 | ₹0Cr | ₹0Cr | 0.4% | 1.41 | 1.16 | 0.7% |
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.