DuPont Decomposition
Why does MANAKALUCO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.3% = 1.3% × 1.02 × 3.87
Latest: FY2026
Profitability
Net Margin
1.3%
1.7% →1.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.02x
1.16x →1.02x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.87x
3.20x →3.87x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.1 pp over 5 years. Driven by asset turnover declining (1.16x → 1.02x), leverage rising (3.20x → 3.87x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.7% | 1.16 | 3.20 | 6.4% |
| FY2023 | ₹0Cr | ₹0Cr | 1.9% | 1.26 | 3.03 | 7.1% |
| FY2024 | ₹0Cr | ₹0Cr | 1.2% | 1.02 | 3.22 | 3.9% |
| FY2025 | ₹0Cr | ₹0Cr | 1.2% | 1.01 | 3.73 | 4.5% |
| FY2026 | ₹0Cr | ₹0Cr | 1.3% | 1.02 | 3.87 | 5.3% |
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.