DuPont Decomposition
Why does GODREJAGRO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.5% = 4.6% × 1.70 × 2.12
Latest: FY2025
Profitability
Net Margin
4.6%
1.1% →4.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.70x
0.38x →1.70x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.12x
2.35x →2.12x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.5 pp over 3 years. Driven by net margin improving (1.1% → 4.6%), asset turnover improving (0.38x → 1.70x), leverage falling (2.35x → 2.12x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 1.1% | 0.38 | 2.35 | 1.0% |
| FY2024 | ₹0Cr | ₹0Cr | 3.1% | 0.37 | 2.27 | 2.6% |
| FY2025 | ₹0Cr | ₹0Cr | 4.6% | 1.70 | 2.12 | 16.5% |
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.