DuPont Decomposition
Why does ESTER earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-3.5% = -2.0% × 0.82 × 2.14
Latest: FY2026
Profitability
Net Margin
-2.0%
12.3% →-2.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.82x
0.78x →0.82x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.14x
2.30x →2.14x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 25.5 pp over 5 years. Driven by net margin declining (12.3% → -2.0%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.3% | 0.78 | 2.30 | 22.0% |
| FY2023 | ₹0Cr | ₹0Cr | 12.4% | 0.65 | 2.31 | 18.4% |
| FY2024 | ₹0Cr | ₹-0Cr | -11.4% | 0.64 | 2.29 | -16.9% |
| FY2025 | ₹0Cr | ₹0Cr | 1.1% | 0.82 | 2.04 | 1.8% |
| FY2026 | ₹0Cr | ₹-0Cr | -2.0% | 0.82 | 2.14 | -3.5% |
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.