DuPont Decomposition
Why does GNA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.9% = 7.1% × 1.11 × 1.52
Latest: FY2025
Profitability
Net Margin
7.1%
8.9% →7.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.11x
0.33x →1.11x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.52x
1.64x →1.52x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 7.1 pp over 3 years. Driven by net margin declining (8.9% → 7.1%), asset turnover improving (0.33x → 1.11x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 8.9% | 0.33 | 1.64 | 4.8% |
| FY2024 | ₹0Cr | ₹0Cr | 4.5% | 0.30 | 1.52 | 2.1% |
| FY2025 | ₹0Cr | ₹0Cr | 7.1% | 1.11 | 1.52 | 11.9% |
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.