DuPont Decomposition
Why does MOL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.9% = 1.3% × 0.72 × 1.96
Latest: FY2026
Profitability
Net Margin
1.3%
12.3% →1.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.72x
0.88x →0.72x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.96x
1.91x →1.96x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 18.9 pp over 5 years. Driven by net margin declining (12.3% → 1.3%), asset turnover declining (0.88x → 0.72x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.3% | 0.88 | 1.91 | 20.8% |
| FY2023 | ₹0Cr | ₹0Cr | 9.4% | 0.79 | 1.92 | 14.2% |
| FY2024 | ₹0Cr | ₹-0Cr | -6.8% | 0.51 | 1.99 | -6.9% |
| FY2025 | ₹0Cr | ₹-0Cr | -0.5% | 0.67 | 2.04 | -0.7% |
| FY2026 | ₹0Cr | ₹0Cr | 1.3% | 0.72 | 1.96 | 1.9% |
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.