DuPont Decomposition
Why does IFBAGRO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.7% = 2.1% × 1.45 × 1.18
Latest: FY2025
Profitability
Net Margin
2.1%
5.9% →2.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.45x
1.69x →1.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.18x
1.18x →1.18x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.0 pp over 4 years. Driven by net margin declining (5.9% → 2.1%), asset turnover declining (1.69x → 1.45x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.9% | 1.69 | 1.18 | 11.7% |
| FY2023 | ₹0Cr | ₹0Cr | 4.0% | 1.94 | 1.15 | 9.0% |
| FY2024 | ₹0Cr | ₹-0Cr | -0.9% | 1.45 | 1.15 | -1.5% |
| FY2025 | ₹0Cr | ₹0Cr | 2.1% | 1.45 | 1.18 | 3.7% |
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.