DuPont Decomposition
Why does BHANDARI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.0% = 2.8% × 1.01 × 1.80
Latest: FY2025
Profitability
Net Margin
2.8%
2.2% →2.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.01x
1.30x →1.01x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.80x
2.67x →1.80x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.7 pp over 4 years. Driven by asset turnover declining (1.30x → 1.01x), leverage falling (2.67x → 1.80x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.2% | 1.30 | 2.67 | 7.7% |
| FY2023 | ₹0Cr | ₹0Cr | 2.3% | 1.30 | 2.49 | 7.5% |
| FY2024 | ₹0Cr | ₹0Cr | 2.5% | 1.06 | 2.52 | 6.6% |
| FY2025 | ₹0Cr | ₹0Cr | 2.8% | 1.01 | 1.80 | 5.0% |
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.