DuPont Decomposition
Why does GANECOS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.0% = 2.6% × 0.74 × 1.57
Latest: FY2026
Profitability
Net Margin
2.6%
6.2% →2.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.74x
0.92x →0.74x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.57x
1.91x →1.57x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.8 pp over 5 years. Driven by net margin declining (6.2% → 2.6%), asset turnover declining (0.92x → 0.74x), leverage falling (1.91x → 1.57x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.2% | 0.92 | 1.91 | 10.8% |
| FY2023 | ₹0Cr | ₹0Cr | 6.0% | 0.88 | 2.07 | 10.9% |
| FY2024 | ₹0Cr | ₹0Cr | 3.8% | 0.67 | 1.54 | 3.9% |
| FY2025 | ₹0Cr | ₹0Cr | 7.0% | 0.76 | 1.68 | 9.0% |
| FY2026 | ₹0Cr | ₹0Cr | 2.6% | 0.74 | 1.57 | 3.0% |
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.