DuPont Decomposition
Why does MENONBE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.7% = 10.5% × 1.03 × 1.45
Latest: FY2025
Profitability
Net Margin
10.5%
17.1% →10.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.03x
0.31x →1.03x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.45x
1.30x →1.45x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.8 pp over 3 years. Driven by net margin declining (17.1% → 10.5%), asset turnover improving (0.31x → 1.03x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 17.1% | 0.31 | 1.30 | 6.9% |
| FY2024 | ₹0Cr | ₹0Cr | 10.5% | 0.26 | 1.43 | 3.9% |
| FY2025 | ₹0Cr | ₹0Cr | 10.5% | 1.03 | 1.45 | 15.7% |
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.