DuPont Decomposition
Why does CNL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
19.3% = 2.6% × 2.88 × 2.58
Latest: FY2026
Profitability
Net Margin
2.6%
1.7% →2.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.88x
3.74x →2.88x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.58x
3.08x →2.58x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~19%. Driven by asset turnover declining (3.74x → 2.88x), leverage falling (3.08x → 2.58x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.7% | 3.74 | 3.08 | 19.4% |
| FY2023 | ₹0Cr | ₹0Cr | 1.8% | 4.84 | 2.45 | 20.9% |
| FY2024 | ₹0Cr | ₹0Cr | 2.6% | 4.74 | 1.68 | 20.4% |
| FY2025 | ₹0Cr | ₹0Cr | 3.0% | 3.34 | 1.81 | 18.1% |
| FY2026 | ₹0Cr | ₹0Cr | 2.6% | 2.88 | 2.58 | 19.3% |
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.