DuPont Decomposition
Why does IRCTC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
35.9% = 28.1% × 0.69 × 1.86
Latest: FY2025
Profitability
Net Margin
28.1%
28.9% →28.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.69x
0.19x →0.69x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.86x
2.05x →1.86x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 24.6 pp over 3 years. Driven by asset turnover improving (0.19x → 0.69x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 28.9% | 0.19 | 2.05 | 11.3% |
| FY2024 | ₹0Cr | ₹0Cr | 24.6% | 0.19 | 1.89 | 8.8% |
| FY2025 | ₹0Cr | ₹0Cr | 28.1% | 0.69 | 1.86 | 35.9% |
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.