DuPont Decomposition
Why does KKCL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.1% = 11.7% × 0.81 × 1.59
Latest: FY2026
Profitability
Net Margin
11.7%
13.5% →11.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.81x
0.81x →0.81x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.59x
1.55x →1.59x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.0 pp over 5 years. Driven by net margin declining (13.5% → 11.7%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 13.5% | 0.81 | 1.55 | 17.1% |
| FY2023 | ₹0Cr | ₹0Cr | 15.4% | 0.95 | 1.49 | 21.8% |
| FY2024 | ₹0Cr | ₹0Cr | 18.0% | 1.02 | 1.24 | 22.8% |
| FY2025 | ₹0Cr | ₹0Cr | 14.4% | 0.70 | 1.74 | 17.6% |
| FY2026 | ₹0Cr | ₹0Cr | 11.7% | 0.81 | 1.59 | 15.1% |
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.