DuPont Decomposition
Why does IPCALAB earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.8% = 8.3% × 0.75 × 1.40
Latest: FY2025
Profitability
Net Margin
8.3%
7.7% →8.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.75x
0.72x →0.75x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.40x
1.48x →1.40x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~9%.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.7% | 0.72 | 1.48 | 8.2% |
| FY2024 | ₹0Cr | ₹0Cr | 6.8% | 0.69 | 1.75 | 8.3% |
| FY2025 | ₹0Cr | ₹0Cr | 8.3% | 0.75 | 1.40 | 8.8% |
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.