DuPont Decomposition
Why does BRIGHOTEL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
19.7% = 4.3% × 0.49 × 9.26
Latest: FY2025
Profitability
Net Margin
4.3%
-52.3% →4.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.49x
0.17x →0.49x
Revenue per ₹ of assets
Leverage
Equity Multiplier
9.26x
19.29x →9.26x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 189.5 pp over 4 years. Driven by net margin improving (-52.3% → 4.3%), asset turnover improving (0.17x → 0.49x), leverage falling (19.29x → 9.26x). 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 | -52.3% | 0.17 | 19.29 | -169.8% |
| FY2023 | ₹0Cr | ₹-0Cr | -1.1% | 0.42 | 17.59 | -8.0% |
| FY2024 | ₹0Cr | ₹0Cr | 6.2% | 0.45 | 11.22 | 31.5% |
| FY2025 | ₹0Cr | ₹0Cr | 4.3% | 0.49 | 9.26 | 19.7% |
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.