DuPont Decomposition
Why does KANORICHEM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-16.4% = -5.5% × 1.01 × 2.94
Latest: FY2025
Profitability
Net Margin
-5.5%
0.5% →-5.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.01x
0.97x →1.01x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.94x
2.33x →2.94x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 17.5 pp over 4 years. Driven by net margin declining (0.5% → -5.5%), leverage rising (2.33x → 2.94x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 0.5% | 0.97 | 2.33 | 1.1% |
| FY2023 | ₹0Cr | ₹-0Cr | -0.6% | 1.06 | 2.44 | -1.4% |
| FY2024 | ₹0Cr | ₹-0Cr | -2.6% | 0.98 | 2.41 | -6.2% |
| FY2025 | ₹0Cr | ₹-0Cr | -5.5% | 1.01 | 2.94 | -16.4% |
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.