DuPont Decomposition
Why does BEDMUTHA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
17.1% = 2.4% × 1.59 × 4.51
Latest: FY2025
Profitability
Net Margin
2.4%
1.4% →2.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.59x
1.33x →1.59x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.51x
5.67x →4.51x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.2 pp over 4 years. Driven by asset turnover improving (1.33x → 1.59x), leverage falling (5.67x → 4.51x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.4% | 1.33 | 5.67 | 10.8% |
| FY2023 | ₹0Cr | ₹0Cr | 1.9% | 1.36 | 5.02 | 13.1% |
| FY2024 | ₹0Cr | ₹0Cr | 2.6% | 1.42 | 4.70 | 17.4% |
| FY2025 | ₹0Cr | ₹0Cr | 2.4% | 1.59 | 4.51 | 17.1% |
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.