DuPont Decomposition
Why does MEDPLUS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.6% = 2.5% × 1.81 × 1.93
Latest: FY2025
Profitability
Net Margin
2.5%
0.6% →2.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.81x
1.62x →1.81x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.93x
1.88x →1.93x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.9 pp over 3 years. Driven by net margin improving (0.6% → 2.5%), asset turnover improving (1.62x → 1.81x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.6% | 1.62 | 1.88 | 1.8% |
| FY2024 | ₹0Cr | ₹0Cr | 0.6% | 1.85 | 1.90 | 2.1% |
| FY2025 | ₹0Cr | ₹0Cr | 2.5% | 1.81 | 1.93 | 8.6% |
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.