DuPont Decomposition
Why does CHEMBONDCH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
17.8% = 10.7% × 1.35 × 1.24
Latest: FY2025
Profitability
Net Margin
10.7%
4.0% →10.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.35x
0.96x →1.35x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.24x
1.18x →1.24x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 13.2 pp over 4 years. Driven by net margin improving (4.0% → 10.7%), asset turnover improving (0.96x → 1.35x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.0% | 0.96 | 1.18 | 4.6% |
| FY2023 | ₹0Cr | ₹0Cr | 5.7% | 1.09 | 1.24 | 7.8% |
| FY2024 | ₹0Cr | ₹0Cr | 10.7% | 1.54 | 1.27 | 20.9% |
| FY2025 | ₹0Cr | ₹0Cr | 10.7% | 1.35 | 1.24 | 17.8% |
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.