DuPont Decomposition
Why does EIHOTEL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.9% = 21.4% × 0.45 × 1.25
Latest: FY2026
Profitability
Net Margin
21.4%
-9.9% →21.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.45x
0.24x →0.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.25x
1.37x →1.25x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.2 pp over 5 years. Driven by net margin improving (-9.9% → 21.4%), asset turnover improving (0.24x → 0.45x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -9.9% | 0.24 | 1.37 | -3.2% |
| FY2023 | ₹0Cr | ₹0Cr | 15.6% | 0.46 | 1.31 | 9.3% |
| FY2024 | ₹0Cr | ₹0Cr | 25.4% | 0.50 | 1.28 | 16.2% |
| FY2025 | ₹0Cr | ₹0Cr | 27.0% | 0.47 | 1.27 | 16.0% |
| FY2026 | ₹0Cr | ₹0Cr | 21.4% | 0.45 | 1.25 | 11.9% |
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.