DuPont Decomposition
Why does NETWORK18 earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.1% = 7.2% × 0.24 × 1.83
Latest: FY2026
Profitability
Net Margin
7.2%
-1.4% →7.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.24x
0.44x →0.24x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.83x
20.72x →1.83x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.6 pp over 4 years. Driven by net margin improving (-1.4% → 7.2%), asset turnover declining (0.44x → 0.24x), leverage falling (20.72x → 1.83x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -1.4% | 0.44 | 20.72 | -12.5% |
| FY2024 | ₹0Cr | ₹-0Cr | -2.3% | 0.23 | 2.62 | -1.4% |
| FY2025 | ₹0Cr | ₹-0Cr | -24.5% | 0.81 | 1.79 | -35.6% |
| FY2026 | ₹0Cr | ₹0Cr | 7.2% | 0.24 | 1.83 | 3.1% |
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.