DuPont Decomposition
Why does LUMAXIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
18.1% = 4.2% × 1.17 × 3.69
Latest: FY2025
Profitability
Net Margin
4.2%
3.4% →4.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.17x
0.33x →1.17x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.69x
3.20x →3.69x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 14.5 pp over 3 years. Driven by asset turnover improving (0.33x → 1.17x), leverage rising (3.20x → 3.69x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.4% | 0.33 | 3.20 | 3.6% |
| FY2024 | ₹0Cr | ₹0Cr | 4.9% | 0.29 | 3.87 | 5.4% |
| FY2025 | ₹0Cr | ₹0Cr | 4.2% | 1.17 | 3.69 | 18.1% |
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.