DuPont Decomposition
Why does DIVGIITTS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.4% = 13.3% × 0.48 × 1.15
Latest: FY2026
Profitability
Net Margin
13.3%
20.2% →13.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.48x
0.56x →0.48x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.15x
1.19x →1.15x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 6.2 pp over 5 years. Driven by net margin declining (20.2% → 13.3%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 20.2% | 0.56 | 1.19 | 13.6% |
| FY2023 | ₹0Cr | ₹0Cr | 19.1% | 0.42 | 1.16 | 9.3% |
| FY2024 | ₹0Cr | ₹0Cr | 15.9% | 0.39 | 1.11 | 6.8% |
| FY2025 | ₹0Cr | ₹0Cr | 11.1% | 0.33 | 1.11 | 4.1% |
| FY2026 | ₹0Cr | ₹0Cr | 13.3% | 0.48 | 1.15 | 7.4% |
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.