DuPont Decomposition

Why does IDBI earn its ROE?

Breaking down Return on Equity into profitability, efficiency, and leverage.

ROE = Net Margin × Asset Turnover × Equity Multiplier

12.3% = 42.4% × 0.04 × 6.68

Latest: FY2025

Profitability

Net Margin

42.4%

42.4% →42.4%

How much profit per ₹ of revenue

Efficiency

Asset Turnover

0.04x

0.04x →0.04x

Revenue per ₹ of assets

Leverage

Equity Multiplier

6.68x

6.68x →6.68x

Assets funded by equity vs debt

Historical Decomposition

Last 1 years

YearRevenuePATNet MarginAsset TOLeverageROE
FY2025₹0Cr₹0Cr42.4%0.046.6812.3%

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)

See DCF fair value for IDBI

Combine financial quality with intrinsic value.

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DuPont decomposition from audited annual financials. Factual analysis, not investment advice.