DuPont Decomposition
Why does GMMPFAUDLR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.1% = 1.7% × 1.02 × 3.01
Latest: FY2025
Profitability
Net Margin
1.7%
9.2% →1.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.02x
0.81x →1.02x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.01x
1.87x →3.01x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.8 pp over 3 years. Driven by net margin declining (9.2% → 1.7%), asset turnover improving (0.81x → 1.02x), leverage rising (1.87x → 3.01x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.2% | 0.81 | 1.87 | 14.0% |
| FY2024 | ₹0Cr | ₹0Cr | 5.0% | 1.09 | 3.26 | 18.0% |
| FY2025 | ₹0Cr | ₹0Cr | 1.7% | 1.02 | 3.01 | 5.1% |
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.