DuPont Decomposition
Why does ARCHIDPLY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-7.1% = -1.3% × 1.42 × 3.78
Latest: FY2025
Profitability
Net Margin
-1.3%
2.9% →-1.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.42x
1.70x →1.42x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.78x
2.39x →3.78x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 18.9 pp over 3 years. Driven by net margin declining (2.9% → -1.3%), asset turnover declining (1.70x → 1.42x), leverage rising (2.39x → 3.78x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 2.9% | 1.70 | 2.39 | 11.8% |
| FY2024 | ₹0Cr | ₹0Cr | 1.6% | 1.33 | 2.93 | 6.3% |
| FY2025 | ₹0Cr | ₹-0Cr | -1.3% | 1.42 | 3.78 | -7.1% |
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.