DuPont Decomposition
Why does GRANULES earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.5% = 11.3% × 0.71 × 1.68
Latest: FY2025
Profitability
Net Margin
11.3%
10.0% →11.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.71x
0.24x →0.71x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.68x
1.73x →1.68x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 9.3 pp over 3 years. Driven by net margin improving (10.0% → 11.2%), asset turnover improving (0.24x → 0.71x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.0% | 0.24 | 1.73 | 4.2% |
| FY2024 | ₹0Cr | ₹0Cr | 11.0% | 0.21 | 1.71 | 4.0% |
| FY2025 | ₹0Cr | ₹0Cr | 11.3% | 0.71 | 1.68 | 13.5% |
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.