DuPont Decomposition
Why does DBSTOCKBRO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.0% = 37.0% × 0.14 × 1.53
Latest: FY2025
Profitability
Net Margin
37.0%
32.9% →37.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.14x
0.27x →0.14x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.53x
1.91x →1.53x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 9.0 pp over 4 years. Driven by net margin improving (32.9% → 37.0%), asset turnover declining (0.27x → 0.14x), leverage falling (1.91x → 1.53x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 32.9% | 0.27 | 1.91 | 17.0% |
| FY2023 | ₹0Cr | ₹0Cr | 68.0% | 0.09 | 1.84 | 11.1% |
| FY2024 | ₹0Cr | ₹0Cr | 69.3% | 0.10 | 1.96 | 13.7% |
| FY2025 | ₹0Cr | ₹0Cr | 37.0% | 0.14 | 1.53 | 8.0% |
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.