DuPont Decomposition
Why does GODREJIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.1% = 5.6% × 0.18 × 11.30
Latest: FY2026
Profitability
Net Margin
5.6%
4.6% →5.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.18x
0.41x →0.18x
Revenue per ₹ of assets
Leverage
Equity Multiplier
11.30x
4.78x →11.30x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 1.9 pp over 5 years. Driven by asset turnover declining (0.41x → 0.18x), leverage rising (4.78x → 11.30x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.6% | 0.41 | 4.78 | 9.2% |
| FY2023 | ₹0Cr | ₹0Cr | 5.8% | 0.38 | 5.51 | 12.2% |
| FY2024 | ₹0Cr | ₹0Cr | 0.4% | 0.27 | 7.69 | 0.8% |
| FY2025 | ₹0Cr | ₹0Cr | 5.0% | 0.22 | 8.66 | 9.7% |
| FY2026 | ₹0Cr | ₹0Cr | 5.6% | 0.18 | 11.30 | 11.1% |
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.