DuPont Decomposition
Why does MANGALAM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.5% = 2.1% × 0.86 × 2.46
Latest: FY2025
Profitability
Net Margin
2.1%
4.4% →2.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.86x
1.36x →0.86x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.46x
2.18x →2.46x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.6 pp over 4 years. Driven by net margin declining (4.4% → 2.1%), asset turnover declining (1.36x → 0.86x), leverage rising (2.18x → 2.46x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.4% | 1.36 | 2.18 | 13.1% |
| FY2023 | ₹0Cr | ₹0Cr | 0.3% | 1.02 | 2.37 | 0.8% |
| FY2024 | ₹0Cr | ₹-0Cr | -2.5% | 1.10 | 2.46 | -6.7% |
| FY2025 | ₹0Cr | ₹0Cr | 2.1% | 0.86 | 2.46 | 4.5% |
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.