DuPont Decomposition
Why does CIGNITITEC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
20.8% = 9.9% × 1.63 × 1.29
Latest: FY2025
Profitability
Net Margin
9.9%
7.4% →9.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.63x
1.78x →1.63x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.29x
1.52x →1.29x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~21%. Driven by net margin improving (7.4% → 9.9%), asset turnover declining (1.78x → 1.63x), leverage falling (1.52x → 1.29x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 7.4% | 1.78 | 1.52 | 19.9% |
| FY2023 | ₹0Cr | ₹0Cr | 10.2% | 1.95 | 1.44 | 28.6% |
| FY2024 | ₹0Cr | ₹0Cr | 9.1% | 1.80 | 1.36 | 22.4% |
| FY2025 | ₹0Cr | ₹0Cr | 9.9% | 1.63 | 1.29 | 20.8% |
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.