DuPont Decomposition
Why does AYE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.6% = 12.9% × 0.21 × 3.82
Latest: FY2025
Profitability
Net Margin
12.9%
-12.5% →12.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.21x
0.18x →0.21x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.82x
3.28x →3.82x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 17.8 pp over 4 years. Driven by net margin improving (-12.5% → 12.9%), leverage rising (3.28x → 3.82x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -12.5% | 0.18 | 3.28 | -7.3% |
| FY2023 | ₹0Cr | ₹0Cr | 6.9% | 0.19 | 4.14 | 5.3% |
| FY2024 | ₹0Cr | ₹0Cr | 17.5% | 0.20 | 3.95 | 13.9% |
| FY2025 | ₹0Cr | ₹0Cr | 12.9% | 0.21 | 3.82 | 10.6% |
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.