DuPont Decomposition
Why does GREENLAM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.8% = 1.9% × 1.01 × 2.55
Latest: FY2026
Profitability
Net Margin
1.9%
5.5% →1.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.01x
1.19x →1.01x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.55x
2.12x →2.55x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 9.1 pp over 5 years. Driven by net margin declining (5.5% → 1.9%), asset turnover declining (1.19x → 1.01x), leverage rising (2.12x → 2.55x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.5% | 1.19 | 2.12 | 13.9% |
| FY2023 | ₹0Cr | ₹0Cr | 6.5% | 0.97 | 2.13 | 13.4% |
| FY2024 | ₹0Cr | ₹0Cr | 6.2% | 0.82 | 2.54 | 12.8% |
| FY2025 | ₹0Cr | ₹0Cr | 2.7% | 0.88 | 2.58 | 6.2% |
| FY2026 | ₹0Cr | ₹0Cr | 1.9% | 1.01 | 2.55 | 4.8% |
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.