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
15.6% = 27.0% × 0.47 × 1.23
Latest: FY2025
Profitability
Net Margin
27.0%
15.6% →27.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.47x
0.46x →0.47x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.23x
1.31x →1.23x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.3 pp over 3 years. Driven by net margin improving (15.6% → 27.0%).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| 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 | 1.23 | 15.6% |
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.