DuPont Decomposition
Why does MARICO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
38.2% = 15.2% × 1.29 × 1.95
Latest: FY2025
Profitability
Net Margin
15.2%
13.6% →15.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.29x
0.32x →1.29x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.95x
1.83x →1.95x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 30.2 pp over 3 years. Driven by net margin improving (13.6% → 15.2%), asset turnover improving (0.32x → 1.29x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 13.6% | 0.32 | 1.83 | 8.0% |
| FY2024 | ₹0Cr | ₹0Cr | 14.1% | 0.31 | 1.94 | 8.3% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 1.29 | 1.95 | 38.2% |
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.