DuPont Decomposition
Why does KITEX earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.4% = 15.3% × 0.35 × 2.50
Latest: FY2025
Profitability
Net Margin
15.3%
16.8% →15.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.35x
0.75x →0.35x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.50x
1.22x →2.50x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.0 pp over 4 years. Driven by net margin declining (16.8% → 15.2%), asset turnover declining (0.75x → 0.35x), leverage rising (1.22x → 2.50x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 16.8% | 0.75 | 1.22 | 15.4% |
| FY2023 | ₹0Cr | ₹0Cr | 10.9% | 0.47 | 1.32 | 6.7% |
| FY2024 | ₹0Cr | ₹0Cr | 9.8% | 0.30 | 2.13 | 6.2% |
| FY2025 | ₹0Cr | ₹0Cr | 15.3% | 0.35 | 2.50 | 13.4% |
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.