DuPont Decomposition
Why does BSE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
30.0% = 44.8% × 0.29 × 2.34
Latest: FY2025
Profitability
Net Margin
44.8%
34.2% →44.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.29x
0.12x →0.29x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.34x
2.33x →2.34x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 20.4 pp over 4 years. Driven by net margin improving (34.2% → 44.8%), asset turnover improving (0.12x → 0.29x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 34.2% | 0.12 | 2.33 | 9.6% |
| FY2023 | ₹0Cr | ₹0Cr | 27.1% | 0.14 | 2.22 | 8.2% |
| FY2024 | ₹0Cr | ₹0Cr | 56.8% | 0.15 | 2.86 | 23.6% |
| FY2025 | ₹0Cr | ₹0Cr | 44.8% | 0.29 | 2.34 | 30.0% |
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.