DuPont Decomposition
Why does LUMAXTECH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
19.0% = 5.2% × 1.06 × 3.47
Latest: FY2025
Profitability
Net Margin
5.2%
4.7% →5.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.06x
1.30x →1.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.47x
2.09x →3.47x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.3 pp over 4 years. Driven by asset turnover declining (1.30x → 1.06x), leverage rising (2.09x → 3.47x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.7% | 1.30 | 2.09 | 12.8% |
| FY2023 | ₹0Cr | ₹0Cr | 5.2% | 0.82 | 3.30 | 14.0% |
| FY2024 | ₹0Cr | ₹0Cr | 4.7% | 1.07 | 3.28 | 16.5% |
| FY2025 | ₹0Cr | ₹0Cr | 5.2% | 1.06 | 3.47 | 19.0% |
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.