DuPont Decomposition
Why does BORORENEW earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-7.0% = -4.7% × 1.01 × 1.45
Latest: FY2025
Profitability
Net Margin
-4.7%
3.4% →-4.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.01x
0.19x →1.01x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.45x
1.78x →1.45x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.1 pp over 3 years. Driven by net margin declining (3.4% → -4.7%), asset turnover improving (0.19x → 1.01x), leverage falling (1.78x → 1.45x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.4% | 0.19 | 1.78 | 1.1% |
| FY2024 | ₹0Cr | ₹-0Cr | -18.8% | 0.17 | 1.93 | -6.1% |
| FY2025 | ₹0Cr | ₹-0Cr | -4.7% | 1.01 | 1.45 | -7.0% |
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.