DuPont Decomposition
Why does BALAXI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.8% = 8.6% × 0.94 × 1.34
Latest: FY2025
Profitability
Net Margin
8.6%
17.1% →8.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.94x
1.58x →0.94x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.34x
1.56x →1.34x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 31.3 pp over 4 years. Driven by net margin declining (17.1% → 8.6%), asset turnover declining (1.58x → 0.94x), leverage falling (1.56x → 1.34x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 17.1% | 1.58 | 1.56 | 42.1% |
| FY2023 | ₹0Cr | ₹0Cr | 13.7% | 1.40 | 1.31 | 25.1% |
| FY2024 | ₹0Cr | ₹-0Cr | -1.0% | 0.93 | 1.28 | -1.2% |
| FY2025 | ₹0Cr | ₹0Cr | 8.6% | 0.94 | 1.34 | 10.8% |
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.