DuPont Decomposition
Why does GUJALKALI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-1.1% = -1.6% × 0.50 × 1.41
Latest: FY2025
Profitability
Net Margin
-1.6%
6.2% →-1.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.50x
0.14x →0.50x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.41x
1.36x →1.41x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.3 pp over 3 years. Driven by net margin declining (6.2% → -1.6%), asset turnover improving (0.14x → 0.50x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 6.2% | 0.14 | 1.36 | 1.2% |
| FY2024 | ₹0Cr | ₹-0Cr | -4.6% | 0.12 | 1.32 | -0.8% |
| FY2025 | ₹0Cr | ₹-0Cr | -1.6% | 0.50 | 1.41 | -1.1% |
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.