DuPont Decomposition
Why does EIDPARRY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.1% = 3.8% × 0.96 × 3.07
Latest: FY2025
Profitability
Net Margin
3.8%
5.5% →3.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.96x
1.04x →0.96x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.07x
2.99x →3.07x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 6.0 pp over 4 years. Driven by net margin declining (5.5% → 3.8%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.5% | 1.04 | 2.99 | 17.0% |
| FY2023 | ₹0Cr | ₹0Cr | 4.6% | 1.10 | 3.09 | 15.6% |
| FY2024 | ₹0Cr | ₹0Cr | 4.2% | 0.99 | 3.05 | 12.8% |
| FY2025 | ₹0Cr | ₹0Cr | 3.8% | 0.96 | 3.07 | 11.1% |
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.