DuPont Decomposition
Why does MAGADSUGAR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.2% = 5.1% × 0.74 × 1.91
Latest: FY2026
Profitability
Net Margin
5.1%
4.7% →5.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.74x
0.73x →0.74x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.91x
2.25x →1.91x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~7%. Driven by leverage falling (2.25x → 1.91x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.7% | 0.73 | 2.25 | 7.7% |
| FY2023 | ₹0Cr | ₹0Cr | 5.3% | 0.67 | 2.20 | 7.9% |
| FY2024 | ₹0Cr | ₹0Cr | 10.6% | 0.68 | 2.16 | 15.6% |
| FY2025 | ₹0Cr | ₹0Cr | 8.3% | 0.78 | 2.03 | 13.1% |
| FY2026 | ₹0Cr | ₹0Cr | 5.1% | 0.74 | 1.91 | 7.2% |
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.