DuPont Decomposition

Why does CCCL earn its ROE?

Breaking down Return on Equity into profitability, efficiency, and leverage.

ROE = Net Margin × Asset Turnover × Equity Multiplier

43.9% = 48.4% × 0.43 × 2.11

Latest: FY2025

Profitability

Net Margin

48.4%

4473.4% →48.4%

How much profit per ₹ of revenue

Efficiency

Asset Turnover

0.43x

0.06x →0.43x

Revenue per ₹ of assets

Leverage

Equity Multiplier

2.11x

19.65x →2.11x

Assets funded by equity vs debt

Trend Analysis

ROE declined by 4797.5 pp over 2 years. Driven by net margin declining (4473.4% → 48.4%), asset turnover improving (0.06x → 0.43x), leverage falling (19.65x → 2.11x).

Historical Decomposition

Last 2 years

Year	Revenue	PAT	Net Margin	Asset TO	Leverage	ROE
FY2024	₹0Cr	₹0Cr	4473.4%	0.06	19.65	4841.4%
FY2025	₹0Cr	₹0Cr	48.4%	0.43	2.11	43.9%

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)

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DuPont decomposition from audited annual financials. Factual analysis, not investment advice.