DuPont Decomposition
Why does BRITANNIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
49.7% = 12.4% × 1.98 × 2.02
Latest: FY2025
Profitability
Net Margin
12.4%
14.3% →12.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.98x
0.45x →1.98x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.02x
2.72x →2.02x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 32.2 pp over 3 years. Driven by net margin declining (14.3% → 12.4%), asset turnover improving (0.45x → 1.98x), leverage falling (2.72x → 2.02x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 14.3% | 0.45 | 2.72 | 17.6% |
| FY2024 | ₹0Cr | ₹0Cr | 13.5% | 0.47 | 2.37 | 15.0% |
| FY2025 | ₹0Cr | ₹0Cr | 12.4% | 1.98 | 2.02 | 49.7% |
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.