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%
4.4% →10.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.39x
1.17x →1.39x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.55x
1.64x →1.55x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 14.3 pp over 4 years. Driven by net margin improving (4.4% → 10.6%), asset turnover improving (1.17x → 1.39x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.4% | 1.17 | 1.64 | 8.4% |
| FY2023 | ₹0Cr | ₹0Cr | 7.0% | 1.22 | 1.76 | 15.0% |
| FY2024 | ₹0Cr | ₹0Cr | 9.4% | 1.30 | 1.76 | 21.6% |
| 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.