DuPont Decomposition
Why does DEN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.3% = 17.0% × 0.23 × 1.12
Latest: FY2026
Profitability
Net Margin
17.0%
20.9% →17.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.23x
0.30x →0.23x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.12x
1.17x →1.12x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.0 pp over 4 years. Driven by net margin declining (20.9% → 17.0%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 20.9% | 0.30 | 1.17 | 7.4% |
| FY2024 | ₹0Cr | ₹0Cr | 19.7% | 0.28 | 1.15 | 6.2% |
| FY2025 | ₹0Cr | ₹0Cr | 19.9% | 0.24 | 1.13 | 5.5% |
| FY2026 | ₹0Cr | ₹0Cr | 17.0% | 0.23 | 1.12 | 4.3% |
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.