DuPont Decomposition
Why does MUTHOOTMF earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-8.4% = -9.2% × 0.22 × 4.12
Latest: FY2025
Profitability
Net Margin
-9.2%
6.6% →-9.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.22x
0.13x →0.22x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.12x
4.18x →4.12x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 12.0 pp over 4 years. Driven by net margin declining (6.6% → -9.2%). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.6% | 0.13 | 4.18 | 3.5% |
| FY2023 | ₹0Cr | ₹0Cr | 12.7% | 0.15 | 5.25 | 10.1% |
| FY2024 | ₹0Cr | ₹0Cr | 18.5% | 0.06 | 4.13 | 4.3% |
| FY2025 | ₹0Cr | ₹-0Cr | -9.2% | 0.22 | 4.12 | -8.4% |
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.