DuPont Decomposition
Why does BAJAJELEC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.7% = 2.8% × 1.14 × 2.45
Latest: FY2025
Profitability
Net Margin
2.8%
3.5% →2.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.14x
0.32x →1.14x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.45x
2.45x →2.45x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 5.0 pp over 3 years. Driven by asset turnover improving (0.32x → 1.14x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.5% | 0.32 | 2.45 | 2.7% |
| FY2024 | ₹0Cr | ₹0Cr | 2.5% | 0.31 | 2.66 | 2.0% |
| FY2025 | ₹0Cr | ₹0Cr | 2.8% | 1.14 | 2.45 | 7.7% |
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.