DuPont Decomposition
Why does CAPITALSFB earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.8% = 26.5% × 0.05 × 7.54
Latest: FY2025
Profitability
Net Margin
26.5%
20.2% →26.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.05x
0.04x →0.05x
Revenue per ₹ of assets
Leverage
Equity Multiplier
7.54x
13.87x →7.54x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.3 pp over 3 years. Driven by net margin improving (20.2% → 26.5%), leverage falling (13.87x → 7.54x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 20.2% | 0.04 | 13.87 | 12.1% |
| FY2023 | ₹0Cr | ₹0Cr | 25.2% | 0.05 | 13.09 | 15.3% |
| FY2025 | ₹0Cr | ₹0Cr | 26.5% | 0.05 | 7.54 | 9.8% |
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.