DuPont Decomposition
Why does J&KBANK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.7% = 29.6% × 0.04 × 11.92
Latest: FY2025
Profitability
Net Margin
29.6%
10.6% →29.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.04x
0.04x →0.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
11.92x
16.17x →11.92x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.5 pp over 4 years. Driven by net margin improving (10.6% → 29.6%), leverage falling (16.17x → 11.92x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 10.6% | 0.04 | 16.17 | 6.1% |
| FY2023 | ₹0Cr | ₹0Cr | 21.8% | 0.04 | 14.74 | 11.9% |
| FY2024 | ₹0Cr | ₹0Cr | 29.7% | 0.04 | 12.67 | 14.5% |
| FY2025 | ₹0Cr | ₹0Cr | 29.6% | 0.04 | 11.92 | 14.7% |
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.