DuPont Decomposition
Why does GAUDIUMIVF earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
41.3% = 27.1% × 0.80 × 1.91
Latest: FY2025
Profitability
Net Margin
27.1%
24.2% →27.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.80x
2.06x →0.80x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.91x
1.91x →1.91x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 53.7 pp over 4 years. Driven by net margin improving (24.2% → 27.1%), asset turnover declining (2.06x → 0.80x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 24.2% | 2.06 | 1.91 | 95.0% |
| FY2023 | ₹0Cr | ₹0Cr | 30.6% | 1.21 | 1.61 | 59.5% |
| FY2024 | ₹0Cr | ₹0Cr | 21.5% | 0.94 | 1.89 | 38.2% |
| FY2025 | ₹0Cr | ₹0Cr | 27.1% | 0.80 | 1.91 | 41.3% |
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.