DuPont Decomposition
Why does EMAMIREAL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-44.3% = -41.3% × 0.05 × 22.64
Latest: FY2023
Profitability
Net Margin
-41.3%
7.8% →-41.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.05x
0.10x →0.05x
Revenue per ₹ of assets
Leverage
Equity Multiplier
22.64x
14.65x →22.64x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 56.1 pp over 2 years. Driven by net margin declining (7.8% → -41.3%), leverage rising (14.65x → 22.64x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 2 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 7.8% | 0.10 | 14.65 | 11.8% |
| FY2023 | ₹0Cr | ₹-0Cr | -41.3% | 0.05 | 22.64 | -44.3% |
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.