DuPont Decomposition
Why does LAXMIDENTL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.2% = 13.4% × 0.83 × 1.36
Latest: FY2025
Profitability
Net Margin
13.4%
-14.2% →13.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.83x
1.26x →0.83x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.36x
4.48x →1.36x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 95.3 pp over 4 years. Driven by net margin improving (-14.2% → 13.4%), asset turnover declining (1.26x → 0.83x), leverage falling (4.48x → 1.36x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -14.2% | 1.26 | 4.48 | -80.0% |
| FY2023 | ₹0Cr | ₹-0Cr | -2.5% | 1.65 | 4.96 | -20.4% |
| FY2024 | ₹0Cr | ₹0Cr | 12.9% | 1.42 | 3.02 | 55.6% |
| FY2025 | ₹0Cr | ₹0Cr | 13.4% | 0.83 | 1.36 | 15.2% |
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.