DuPont Decomposition
Why does EUROBOND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.8% = 4.4% × 1.36 × 2.33
Latest: FY2025
Profitability
Net Margin
4.4%
6.1% →4.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.36x
1.17x →1.36x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.33x
2.05x →2.33x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~14%. Driven by net margin declining (6.1% → 4.4%), asset turnover improving (1.17x → 1.36x), leverage rising (2.05x → 2.33x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.1% | 1.17 | 2.05 | 14.5% |
| FY2023 | ₹0Cr | ₹0Cr | 3.1% | 1.48 | 2.21 | 10.0% |
| FY2024 | ₹0Cr | ₹0Cr | 3.7% | 1.41 | 2.45 | 12.7% |
| FY2025 | ₹0Cr | ₹0Cr | 4.4% | 1.36 | 2.33 | 13.8% |
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.