DuPont Decomposition
Why does MSTCLTD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
55.1% = 145.3% × 0.13 × 2.87
Latest: FY2025
Profitability
Net Margin
145.3%
39.2% →145.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.13x
0.07x →0.13x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.87x
3.42x →2.87x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 45.4 pp over 3 years. Driven by net margin improving (39.2% → 145.3%), leverage falling (3.42x → 2.87x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 39.2% | 0.07 | 3.42 | 9.8% |
| FY2024 | ₹0Cr | ₹0Cr | 24.3% | 0.09 | 2.53 | 5.5% |
| FY2025 | ₹0Cr | ₹0Cr | 145.3% | 0.13 | 2.87 | 55.1% |
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.