DuPont Decomposition
Why does DAMCAPITAL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.9% = 32.8% × 0.49 × 1.37
Latest: FY2026
Profitability
Net Margin
32.8%
24.0% →32.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.49x
0.55x →0.49x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.90x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.0 pp over 5 years. Driven by net margin improving (24.0% → 32.8%), leverage falling (1.90x → 1.37x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 24.0% | 0.55 | 1.90 | 24.9% |
| FY2023 | ₹0Cr | ₹0Cr | 10.7% | 0.07 | 12.63 | 9.1% |
| FY2024 | ₹0Cr | ₹0Cr | 40.6% | 0.81 | 1.32 | 43.4% |
| FY2025 | ₹0Cr | ₹0Cr | 43.9% | 0.59 | 1.52 | 39.3% |
| FY2026 | ₹0Cr | ₹0Cr | 32.8% | 0.49 | 1.37 | 21.9% |
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.