DuPont Decomposition
Why does INSECTICID earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.1% = 7.1% × 1.05 × 1.75
Latest: FY2025
Profitability
Net Margin
7.1%
-9.7% →7.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.05x
0.18x →1.05x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.75x
1.85x →1.75x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 16.3 pp over 3 years. Driven by net margin improving (-9.7% → 7.1%), asset turnover improving (0.18x → 1.05x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -9.7% | 0.18 | 1.85 | -3.2% |
| FY2024 | ₹0Cr | ₹0Cr | 2.9% | 0.16 | 1.69 | 0.8% |
| FY2025 | ₹0Cr | ₹0Cr | 7.1% | 1.05 | 1.75 | 13.1% |
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.