DuPont Decomposition
Why does FIVESTAR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
17.0% = 39.6% × 0.19 × 2.29
Latest: FY2025
Profitability
Net Margin
39.6%
36.8% →39.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.19x
0.19x →0.19x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.29x
1.71x →2.29x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.8 pp over 4 years. Driven by net margin improving (36.8% → 39.6%), leverage rising (1.71x → 2.29x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 36.8% | 0.19 | 1.71 | 12.2% |
| FY2023 | ₹0Cr | ₹0Cr | 38.4% | 0.05 | 2.01 | 3.9% |
| FY2024 | ₹0Cr | ₹0Cr | 38.3% | 0.05 | 2.25 | 4.5% |
| FY2025 | ₹0Cr | ₹0Cr | 39.6% | 0.19 | 2.29 | 17.0% |
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.