DuPont Decomposition
Why does CAMS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
36.0% = 31.4% × 0.84 × 1.37
Latest: FY2026
Profitability
Net Margin
31.4%
31.5% →31.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.84x
0.95x →0.84x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.48x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.3 pp over 5 years. Driven by asset turnover declining (0.95x → 0.84x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 31.5% | 0.95 | 1.48 | 44.3% |
| FY2023 | ₹0Cr | ₹0Cr | 29.4% | 0.89 | 1.40 | 36.5% |
| FY2024 | ₹0Cr | ₹0Cr | 31.1% | 0.80 | 1.55 | 38.7% |
| FY2025 | ₹0Cr | ₹0Cr | 33.0% | 0.89 | 1.43 | 42.0% |
| FY2026 | ₹0Cr | ₹0Cr | 31.4% | 0.84 | 1.37 | 36.0% |
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.