DuPont Decomposition
Why does BALAJEE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.6% = 1.9% × 0.92 × 2.06
Latest: FY2026
Profitability
Net Margin
1.9%
2.3% →1.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.92x
1.12x →0.92x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.06x
4.25x →2.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.5 pp over 5 years. Driven by asset turnover declining (1.12x → 0.92x), leverage falling (4.25x → 2.06x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.3% | 1.12 | 4.25 | 11.1% |
| FY2023 | ₹0Cr | ₹0Cr | 3.5% | 1.18 | 3.56 | 14.8% |
| FY2024 | ₹0Cr | ₹0Cr | 5.6% | 1.01 | 2.98 | 16.9% |
| FY2025 | ₹0Cr | ₹0Cr | 4.3% | 0.99 | 2.02 | 8.7% |
| FY2026 | ₹0Cr | ₹0Cr | 1.9% | 0.92 | 2.06 | 3.6% |
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.