DuPont Decomposition
Why does BANSWRAS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.0% = 1.8% × 1.06 × 2.14
Latest: FY2025
Profitability
Net Margin
1.8%
7.8% →1.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.06x
0.35x →1.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.14x
2.10x →2.14x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.7 pp over 3 years. Driven by net margin declining (7.8% → 1.8%), asset turnover improving (0.35x → 1.06x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.8% | 0.35 | 2.10 | 5.7% |
| FY2024 | ₹0Cr | ₹0Cr | 2.5% | 0.32 | 2.00 | 1.6% |
| FY2025 | ₹0Cr | ₹0Cr | 1.8% | 1.06 | 2.14 | 4.0% |
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.