DuPont Decomposition
Why does LOTUSDEV earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
24.4% = 41.4% × 0.45 × 1.30
Latest: FY2025
Profitability
Net Margin
41.4%
12.6% →41.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.45x
0.24x →0.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.30x
13.55x →1.30x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 16.9 pp over 4 years. Driven by net margin improving (12.6% → 41.4%), asset turnover improving (0.24x → 0.45x), leverage falling (13.55x → 1.30x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.6% | 0.24 | 13.55 | 41.2% |
| FY2023 | ₹0Cr | ₹0Cr | 10.0% | 0.34 | 10.21 | 34.9% |
| FY2024 | ₹0Cr | ₹0Cr | 26.0% | 0.63 | 4.32 | 70.3% |
| FY2025 | ₹0Cr | ₹0Cr | 41.4% | 0.45 | 1.30 | 24.4% |
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.