DuPont Decomposition
Why does BIRLACORPN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.6% = 5.8% × 0.67 × 1.97
Latest: FY2026
Profitability
Net Margin
5.8%
5.5% →5.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.67x
0.53x →0.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.97x
2.29x →1.97x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~8%. Driven by asset turnover improving (0.53x → 0.67x), leverage falling (2.29x → 1.97x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.5% | 0.53 | 2.29 | 6.6% |
| FY2023 | ₹0Cr | ₹0Cr | 0.5% | 0.60 | 2.35 | 0.7% |
| FY2024 | ₹0Cr | ₹0Cr | 4.4% | 0.66 | 2.16 | 6.3% |
| FY2025 | ₹0Cr | ₹0Cr | 3.2% | 0.64 | 2.04 | 4.2% |
| FY2026 | ₹0Cr | ₹0Cr | 5.8% | 0.67 | 1.97 | 7.6% |
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.