DuPont Decomposition
Why does DLINKINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.9% = 7.5% × 1.85 × 1.57
Latest: FY2025
Profitability
Net Margin
7.5%
6.5% →7.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.85x
0.49x →1.85x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.57x
1.66x →1.57x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 16.6 pp over 3 years. Driven by net margin improving (6.5% → 7.5%), asset turnover improving (0.49x → 1.85x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 6.5% | 0.49 | 1.66 | 5.3% |
| FY2024 | ₹0Cr | ₹0Cr | 7.5% | 0.48 | 1.60 | 5.8% |
| FY2025 | ₹0Cr | ₹0Cr | 7.5% | 1.85 | 1.57 | 21.9% |
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.