DuPont Decomposition
Why does LGBBROSLTD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.8% = 12.5% × 0.94 × 1.35
Latest: FY2025
Profitability
Net Margin
12.5%
10.4% →12.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.94x
0.28x →0.94x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.35x
1.37x →1.35x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 11.8 pp over 3 years. Driven by net margin improving (10.4% → 12.5%), asset turnover improving (0.28x → 0.94x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.4% | 0.28 | 1.37 | 4.0% |
| FY2024 | ₹0Cr | ₹0Cr | 11.2% | 0.27 | 1.36 | 4.1% |
| FY2025 | ₹0Cr | ₹0Cr | 12.5% | 0.94 | 1.35 | 15.8% |
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.