DuPont Decomposition
Why does COFORGE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.3% = 9.5% × 1.10 × 1.56
Latest: FY2026
Profitability
Net Margin
9.5%
10.3% →9.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.10x
1.30x →1.10x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.56x
1.81x →1.56x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.9 pp over 5 years. Driven by asset turnover declining (1.30x → 1.10x), leverage falling (1.81x → 1.56x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 10.3% | 1.30 | 1.81 | 24.2% |
| FY2023 | ₹0Cr | ₹0Cr | 8.7% | 1.41 | 1.84 | 22.5% |
| FY2024 | ₹0Cr | ₹0Cr | 9.0% | 1.48 | 1.68 | 22.3% |
| FY2025 | ₹0Cr | ₹0Cr | 6.7% | 0.97 | 1.96 | 12.7% |
| FY2026 | ₹0Cr | ₹0Cr | 9.5% | 1.10 | 1.56 | 16.3% |
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.