DuPont Decomposition
Why does ARIHANT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.9% = 14.0% × 0.41 × 2.74
Latest: FY2026
Profitability
Net Margin
14.0%
-1.2% →14.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.41x
0.14x →0.41x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.74x
5.18x →2.74x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 16.7 pp over 5 years. Driven by net margin improving (-1.2% → 14.0%), asset turnover improving (0.14x → 0.41x), leverage falling (5.18x → 2.74x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -1.2% | 0.14 | 5.18 | -0.8% |
| FY2023 | ₹0Cr | ₹0Cr | 15.5% | 0.13 | 2.76 | 5.6% |
| FY2024 | ₹0Cr | ₹0Cr | 10.9% | 0.28 | 2.31 | 7.0% |
| FY2025 | ₹0Cr | ₹0Cr | 20.7% | 0.36 | 1.87 | 13.7% |
| FY2026 | ₹0Cr | ₹0Cr | 14.0% | 0.41 | 2.74 | 15.9% |
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.