DuPont Decomposition
Why does BPCL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
25.8% = 5.7% × 1.83 × 2.48
Latest: FY2026
Profitability
Net Margin
5.7%
3.4% →5.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.83x
1.84x →1.83x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.48x
3.61x →2.48x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.3 pp over 5 years. Driven by net margin improving (3.4% → 5.7%), leverage falling (3.61x → 2.48x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.4% | 1.84 | 3.61 | 22.5% |
| FY2023 | ₹0Cr | ₹0Cr | 0.5% | 2.48 | 3.52 | 4.0% |
| FY2024 | ₹0Cr | ₹0Cr | 6.0% | 2.21 | 2.68 | 35.5% |
| FY2025 | ₹0Cr | ₹0Cr | 3.0% | 2.02 | 2.68 | 16.4% |
| FY2026 | ₹0Cr | ₹0Cr | 5.7% | 1.83 | 2.48 | 25.8% |
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.