DuPont Decomposition
Why does NOCIL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.8% = 7.5% × 0.67 × 1.17
Latest: FY2025
Profitability
Net Margin
7.5%
7.2% →7.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.67x
0.21x →0.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.17x
1.20x →1.17x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.0 pp over 3 years. Driven by asset turnover improving (0.21x → 0.67x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.2% | 0.21 | 1.20 | 1.8% |
| FY2024 | ₹0Cr | ₹0Cr | 11.7% | 0.18 | 1.19 | 2.5% |
| FY2025 | ₹0Cr | ₹0Cr | 7.5% | 0.67 | 1.17 | 5.8% |
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.