DuPont Decomposition
Why does ASHOKA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
40.7% = 18.9% × 0.43 × 4.99
Latest: FY2025
Profitability
Net Margin
18.9%
4.6% →18.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.43x
0.47x →0.43x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.99x
9.77x →4.99x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 19.5 pp over 3 years. Driven by net margin improving (4.6% → 18.9%), leverage falling (9.77x → 4.99x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.6% | 0.47 | 9.77 | 21.3% |
| FY2024 | ₹0Cr | ₹0Cr | 5.3% | 0.51 | 8.61 | 23.5% |
| FY2025 | ₹0Cr | ₹0Cr | 18.9% | 0.43 | 4.99 | 40.7% |
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.