DuPont Decomposition

Why does FEDERALBNK earn its ROE?

Breaking down Return on Equity into profitability, efficiency, and leverage.

ROE = Net Margin × Asset Turnover × Equity Multiplier

11.7% = 29.2% × 0.04 × 10.16

Latest: FY2025

Profitability

Net Margin

29.2%

29.2% →29.2%

How much profit per ₹ of revenue

Efficiency

Asset Turnover

0.04x

0.04x →0.04x

Revenue per ₹ of assets

Leverage

Equity Multiplier

10.16x

10.16x →10.16x

Assets funded by equity vs debt

Historical Decomposition

Last 1 years

YearRevenuePATNet MarginAsset TOLeverageROE
FY2025₹0Cr₹0Cr29.2%0.0410.1611.7%

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)

See DCF fair value for FEDERALBNK

Combine financial quality with intrinsic value.

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DuPont decomposition from audited annual financials. Factual analysis, not investment advice.