DuPont Decomposition
Why does NITCO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.9% = 5.4% × 0.49 × 2.99
Latest: FY2026
Profitability
Net Margin
5.4%
-236.8% →5.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.49x
0.34x →0.49x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.99x
3.73x →2.99x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 308.4 pp over 2 years. Driven by net margin improving (-236.8% → 5.4%), asset turnover improving (0.34x → 0.49x), leverage falling (3.73x → 2.99x).
Historical Decomposition
Last 2 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2025 | ₹0Cr | ₹-0Cr | -236.8% | 0.34 | 3.73 | -300.5% |
| FY2026 | ₹0Cr | ₹0Cr | 5.4% | 0.49 | 2.99 | 7.9% |
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.