DuPont Decomposition
Why does EQUITASBNK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.7% = 2.3% × 0.07 × 9.90
Latest: FY2026
Profitability
Net Margin
2.3%
11.2% →2.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.07x
0.09x →0.07x
Revenue per ₹ of assets
Leverage
Equity Multiplier
9.90x
6.35x →9.90x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 4.9 pp over 5 years. Driven by net margin declining (11.2% → 2.3%), leverage rising (6.35x → 9.90x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.2% | 0.09 | 6.35 | 6.6% |
| FY2023 | ₹0Cr | ₹0Cr | 18.8% | 0.09 | 6.78 | 11.1% |
| FY2024 | ₹0Cr | ₹0Cr | 21.3% | 0.08 | 7.59 | 13.4% |
| FY2025 | ₹0Cr | ₹0Cr | 3.5% | 0.08 | 8.70 | 2.4% |
| FY2026 | ₹0Cr | ₹0Cr | 2.3% | 0.07 | 9.90 | 1.7% |
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.