DuPont Decomposition
Why does AUROPHARMA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.7% = 11.1% × 0.63 × 1.52
Latest: FY2025
Profitability
Net Margin
11.1%
7.8% →11.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.63x
0.16x →0.63x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.52x
1.49x →1.52x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.8 pp over 3 years. Driven by net margin improving (7.8% → 11.1%), asset turnover improving (0.16x → 0.63x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.8% | 0.16 | 1.49 | 1.9% |
| FY2024 | ₹0Cr | ₹0Cr | 12.0% | 0.17 | 1.51 | 3.0% |
| FY2025 | ₹0Cr | ₹0Cr | 11.1% | 0.63 | 1.52 | 10.7% |
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.