DuPont Decomposition
Why does DIVISLAB earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.6% = 23.5% × 0.55 × 1.13
Latest: FY2025
Profitability
Net Margin
23.5%
16.4% →23.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.55x
0.14x →0.55x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.13x
1.13x →1.13x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 12.1 pp over 3 years. Driven by net margin improving (16.4% → 23.5%), asset turnover improving (0.14x → 0.55x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 16.4% | 0.14 | 1.13 | 2.5% |
| FY2024 | ₹0Cr | ₹0Cr | 23.4% | 0.15 | 1.14 | 4.0% |
| FY2025 | ₹0Cr | ₹0Cr | 23.5% | 0.55 | 1.13 | 14.6% |
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.