DuPont Decomposition
Why does GPIL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.8% = 14.9% × 0.74 × 1.26
Latest: FY2026
Profitability
Net Margin
14.9%
27.4% →14.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.74x
1.09x →0.74x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.26x
1.48x →1.26x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 30.5 pp over 5 years. Driven by net margin declining (27.4% → 14.9%), asset turnover declining (1.09x → 0.74x), leverage falling (1.48x → 1.26x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 27.4% | 1.09 | 1.48 | 44.3% |
| FY2023 | ₹0Cr | ₹0Cr | 13.8% | 1.11 | 1.32 | 20.3% |
| FY2024 | ₹0Cr | ₹0Cr | 17.2% | 0.98 | 1.23 | 20.8% |
| FY2025 | ₹0Cr | ₹0Cr | 15.1% | 0.87 | 1.26 | 16.5% |
| FY2026 | ₹0Cr | ₹0Cr | 14.9% | 0.74 | 1.26 | 13.8% |
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.