DuPont Decomposition
Why does CEWATER earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.7% = 8.7% × 0.70 × 1.59
Latest: FY2025
Profitability
Net Margin
8.7%
5.0% →8.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.70x
0.61x →0.70x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.59x
2.00x →1.59x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.5 pp over 4 years. Driven by net margin improving (5.0% → 8.7%), leverage falling (2.00x → 1.59x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.0% | 0.61 | 2.00 | 6.1% |
| FY2023 | ₹0Cr | ₹0Cr | 1.6% | 0.58 | 2.11 | 1.9% |
| FY2024 | ₹0Cr | ₹0Cr | 8.4% | 0.79 | 1.95 | 12.8% |
| FY2025 | ₹0Cr | ₹0Cr | 8.7% | 0.70 | 1.59 | 9.7% |
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.