DuPont Decomposition
Why does DBL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.2% = 6.1% × 0.53 × 3.75
Latest: FY2025
Profitability
Net Margin
6.1%
0.0% →6.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.53x
0.67x →0.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.75x
3.86x →3.75x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 12.2 pp over 3 years. Driven by net margin improving (0.0% → 6.1%), asset turnover declining (0.67x → 0.53x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.0% | 0.67 | 3.86 | 0.0% |
| FY2024 | ₹0Cr | ₹0Cr | 1.6% | 0.71 | 3.81 | 4.4% |
| FY2025 | ₹0Cr | ₹0Cr | 6.1% | 0.53 | 3.75 | 12.2% |
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.