DuPont Decomposition
Why does MUNJALAU earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.5% = 1.8% × 1.65 × 2.89
Latest: FY2025
Profitability
Net Margin
1.8%
0.5% →1.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.65x
0.38x →1.65x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.89x
3.32x →2.89x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 7.9 pp over 3 years. Driven by net margin improving (0.5% → 1.8%), asset turnover improving (0.38x → 1.65x), leverage falling (3.32x → 2.89x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.5% | 0.38 | 3.32 | 0.6% |
| FY2024 | ₹0Cr | ₹0Cr | 8.9% | 0.33 | 3.04 | 9.1% |
| FY2025 | ₹0Cr | ₹0Cr | 1.8% | 1.65 | 2.89 | 8.5% |
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.