DuPont Decomposition
Why does JMA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.2% = 4.6% × 1.61 × 1.37
Latest: FY2025
Profitability
Net Margin
4.6%
5.5% →4.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.61x
1.61x →1.61x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.47x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.9 pp over 4 years.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.5% | 1.61 | 1.47 | 13.2% |
| FY2023 | ₹0Cr | ₹0Cr | 5.4% | 1.71 | 1.42 | 13.1% |
| FY2024 | ₹0Cr | ₹0Cr | 4.8% | 1.63 | 1.42 | 11.1% |
| FY2025 | ₹0Cr | ₹0Cr | 4.6% | 1.61 | 1.37 | 10.2% |
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.