DuPont Decomposition
Why does DEVIT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.7% = 8.7% × 1.39 × 1.78
Latest: FY2025
Profitability
Net Margin
8.7%
0.1% →8.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.39x
1.50x →1.39x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.78x
2.03x →1.78x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 21.3 pp over 4 years. Driven by net margin improving (0.1% → 8.7%), asset turnover declining (1.50x → 1.39x), leverage falling (2.03x → 1.78x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 0.1% | 1.50 | 2.03 | 0.4% |
| FY2023 | ₹0Cr | ₹0Cr | 7.2% | 1.83 | 1.63 | 21.6% |
| FY2024 | ₹0Cr | ₹0Cr | 5.7% | 1.71 | 1.72 | 16.8% |
| FY2025 | ₹0Cr | ₹0Cr | 8.7% | 1.39 | 1.78 | 21.7% |
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.