DuPont Decomposition
Why does DPWIRES earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.9% = 3.6% × 2.07 × 1.20
Latest: FY2025
Profitability
Net Margin
3.6%
3.4% →3.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.07x
4.83x →2.07x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.20x
1.31x →1.20x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 12.5 pp over 3 years. Driven by asset turnover declining (4.83x → 2.07x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.4% | 4.83 | 1.31 | 21.4% |
| FY2024 | ₹0Cr | ₹0Cr | 3.6% | 3.82 | 1.16 | 16.1% |
| FY2025 | ₹0Cr | ₹0Cr | 3.6% | 2.07 | 1.20 | 8.9% |
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.