DuPont Decomposition
Why does CANFINHOME earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
18.2% = 66.0% × 0.04 × 7.42
Latest: FY2026
Profitability
Net Margin
66.0%
23.7% →66.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.04x
0.07x →0.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
7.42x
9.11x →7.42x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.8 pp over 5 years. Driven by net margin improving (23.7% → 66.0%), leverage falling (9.11x → 7.42x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 23.7% | 0.07 | 9.11 | 15.4% |
| FY2023 | ₹0Cr | ₹0Cr | 61.4% | 0.03 | 9.07 | 17.0% |
| FY2024 | ₹0Cr | ₹0Cr | 59.2% | 0.03 | 8.52 | 17.3% |
| FY2025 | ₹0Cr | ₹0Cr | 63.0% | 0.03 | 8.08 | 16.9% |
| FY2026 | ₹0Cr | ₹0Cr | 66.0% | 0.04 | 7.42 | 18.2% |
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.