DuPont Decomposition
Why does JNKINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.0% = 6.3% × 0.60 × 1.56
Latest: FY2025
Profitability
Net Margin
6.3%
12.1% →6.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.60x
1.10x →0.60x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.56x
3.72x →1.56x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 43.9 pp over 4 years. Driven by net margin declining (12.1% → 6.3%), asset turnover declining (1.10x → 0.60x), leverage falling (3.72x → 1.56x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.1% | 1.10 | 3.72 | 49.9% |
| FY2023 | ₹0Cr | ₹0Cr | 11.4% | 1.21 | 2.76 | 38.0% |
| FY2024 | ₹0Cr | ₹0Cr | 13.0% | 0.91 | 2.70 | 32.1% |
| FY2025 | ₹0Cr | ₹0Cr | 6.3% | 0.60 | 1.56 | 6.0% |
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.