DuPont Decomposition
Why does NESCO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.8% = 44.3% × 0.25 × 1.23
Latest: FY2026
Profitability
Net Margin
44.3%
56.1% →44.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.25x
0.17x →0.25x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.23x
1.16x →1.23x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.6 pp over 5 years. Driven by net margin declining (56.1% → 44.3%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 56.1% | 0.17 | 1.16 | 11.1% |
| FY2023 | ₹0Cr | ₹0Cr | 53.2% | 0.24 | 1.15 | 14.8% |
| FY2024 | ₹0Cr | ₹0Cr | 53.5% | 0.26 | 1.15 | 15.8% |
| FY2025 | ₹0Cr | ₹0Cr | 51.3% | 0.24 | 1.15 | 14.3% |
| FY2026 | ₹0Cr | ₹0Cr | 44.3% | 0.25 | 1.23 | 13.8% |
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.