DuPont Decomposition
Why does APOLLOHOSP earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.7% = 6.7% × 1.04 × 2.39
Latest: FY2025
Profitability
Net Margin
6.7%
3.4% →6.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.04x
0.30x →1.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.39x
2.33x →2.39x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 14.4 pp over 3 years. Driven by net margin improving (3.4% → 6.7%), asset turnover improving (0.30x → 1.04x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.4% | 0.30 | 2.33 | 2.4% |
| FY2024 | ₹0Cr | ₹0Cr | 5.2% | 0.30 | 2.42 | 3.7% |
| FY2025 | ₹0Cr | ₹0Cr | 6.7% | 1.04 | 2.39 | 16.7% |
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.