DuPont Decomposition
Why does CENTURYPLY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.8% = 4.1% × 0.98 × 1.93
Latest: FY2025
Profitability
Net Margin
4.1%
10.5% →4.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.98x
1.34x →0.98x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.93x
1.42x →1.93x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 12.3 pp over 3 years. Driven by net margin declining (10.5% → 4.1%), asset turnover declining (1.34x → 0.98x), leverage rising (1.42x → 1.93x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.5% | 1.34 | 1.42 | 20.1% |
| FY2024 | ₹0Cr | ₹0Cr | 8.4% | 1.09 | 1.61 | 14.7% |
| FY2025 | ₹0Cr | ₹0Cr | 4.1% | 0.98 | 1.93 | 7.8% |
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.