DuPont Decomposition
Why does KOKUYOCMLN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.9% = 0.8% × 1.67 × 1.50
Latest: FY2025
Profitability
Net Margin
0.8%
4.0% →0.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.67x
0.49x →1.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.50x
1.68x →1.50x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.4 pp over 3 years. Driven by net margin declining (4.0% → 0.8%), asset turnover improving (0.49x → 1.67x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.0% | 0.49 | 1.68 | 3.3% |
| FY2024 | ₹0Cr | ₹0Cr | 4.8% | 0.44 | 1.66 | 3.5% |
| FY2025 | ₹0Cr | ₹0Cr | 0.8% | 1.67 | 1.50 | 1.9% |
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.