DuPont Decomposition
Why does JAINREC earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
30.9% = 3.2% × 3.85 × 2.53
Latest: FY2025
Profitability
Net Margin
3.2%
3.1% →3.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
3.85x
2.78x →3.85x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.53x
9.49x →2.53x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 50.0 pp over 4 years. Driven by asset turnover improving (2.78x → 3.85x), leverage falling (9.49x → 2.53x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.1% | 2.78 | 9.49 | 80.9% |
| FY2023 | ₹0Cr | ₹0Cr | 3.0% | 2.74 | 5.54 | 45.6% |
| FY2024 | ₹0Cr | ₹0Cr | 3.7% | 2.89 | 4.14 | 44.4% |
| FY2025 | ₹0Cr | ₹0Cr | 3.2% | 3.85 | 2.53 | 30.9% |
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.