DuPont Decomposition
Why does CELLO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.3% = 14.3% × 0.77 × 1.11
Latest: FY2026
Profitability
Net Margin
14.3%
15.1% →14.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.77x
1.01x →0.77x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.11x
15.22x →1.11x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 220.5 pp over 5 years. Driven by asset turnover declining (1.01x → 0.77x), leverage falling (15.22x → 1.11x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 15.1% | 1.01 | 15.22 | 232.8% |
| FY2023 | ₹0Cr | ₹0Cr | 14.9% | 1.15 | 4.61 | 79.1% |
| FY2024 | ₹0Cr | ₹0Cr | 16.6% | 1.01 | 1.72 | 28.8% |
| FY2025 | ₹0Cr | ₹0Cr | 17.1% | 0.81 | 1.22 | 16.8% |
| FY2026 | ₹0Cr | ₹0Cr | 14.3% | 0.77 | 1.11 | 12.3% |
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.