DuPont Decomposition
Why does CAPACITE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.8% = 8.7% × 0.67 × 2.03
Latest: FY2025
Profitability
Net Margin
8.7%
4.8% →8.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.67x
0.17x →0.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.03x
2.44x →2.03x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 9.8 pp over 3 years. Driven by net margin improving (4.8% → 8.7%), asset turnover improving (0.17x → 0.67x), leverage falling (2.44x → 2.03x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.8% | 0.17 | 2.44 | 2.0% |
| FY2024 | ₹0Cr | ₹0Cr | 8.7% | 0.19 | 2.08 | 3.4% |
| FY2025 | ₹0Cr | ₹0Cr | 8.7% | 0.67 | 2.03 | 11.8% |
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.