DuPont Decomposition
Why does AVANTEL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
23.8% = 22.7% × 0.86 × 1.22
Latest: FY2025
Profitability
Net Margin
22.7%
17.1% →22.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.86x
0.96x →0.86x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.22x
1.32x →1.22x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.0 pp over 4 years. Driven by net margin improving (17.1% → 22.7%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 17.1% | 0.96 | 1.32 | 21.8% |
| FY2023 | ₹0Cr | ₹0Cr | 17.4% | 1.03 | 1.39 | 25.0% |
| FY2024 | ₹0Cr | ₹0Cr | 23.4% | 1.04 | 1.32 | 32.0% |
| FY2025 | ₹0Cr | ₹0Cr | 22.7% | 0.86 | 1.22 | 23.8% |
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.