DuPont Decomposition
Why does INDOTECH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
22.8% = 10.6% × 1.39 × 1.55
Latest: FY2025
Profitability
Net Margin
10.6%
13.3% →10.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.39x
0.48x →1.39x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.55x
1.76x →1.55x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 11.5 pp over 3 years. Driven by net margin declining (13.3% → 10.6%), asset turnover improving (0.48x → 1.39x), leverage falling (1.76x → 1.55x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 13.3% | 0.48 | 1.76 | 11.3% |
| FY2024 | ₹0Cr | ₹0Cr | 14.6% | 0.46 | 1.76 | 11.8% |
| FY2025 | ₹0Cr | ₹0Cr | 10.6% | 1.39 | 1.55 | 22.8% |
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.