DuPont Decomposition
Why does DHRUV earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.7% = 6.8% × 0.72 × 1.37
Latest: FY2025
Profitability
Net Margin
6.8%
7.7% →6.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.72x
0.88x →0.72x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.85x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 5.8 pp over 4 years. Driven by asset turnover declining (0.88x → 0.72x), leverage falling (1.85x → 1.37x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 7.7% | 0.88 | 1.85 | 12.6% |
| FY2023 | ₹0Cr | ₹0Cr | 5.9% | 0.75 | 1.90 | 8.4% |
| FY2024 | ₹0Cr | ₹0Cr | 7.2% | 0.75 | 1.63 | 8.9% |
| FY2025 | ₹0Cr | ₹0Cr | 6.8% | 0.72 | 1.37 | 6.7% |
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.