DuPont Decomposition
Why does AMBER earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.5% = 2.5% × 1.15 × 3.65
Latest: FY2025
Profitability
Net Margin
2.5%
3.6% →2.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.15x
0.48x →1.15x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.65x
3.27x →3.65x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.9 pp over 3 years. Driven by net margin declining (3.6% → 2.5%), asset turnover improving (0.48x → 1.15x), leverage rising (3.27x → 3.65x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.6% | 0.48 | 3.27 | 5.7% |
| FY2024 | ₹0Cr | ₹0Cr | 3.5% | 0.43 | 3.19 | 4.8% |
| FY2025 | ₹0Cr | ₹0Cr | 2.5% | 1.15 | 3.65 | 10.5% |
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.