DuPont Decomposition
Why does PANACHE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.5% = 5.9% × 1.02 × 1.73
Latest: FY2025
Profitability
Net Margin
5.9%
0.7% →5.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.02x
1.09x →1.02x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.73x
3.25x →1.73x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 7.8 pp over 3 years. Driven by net margin improving (0.7% → 5.9%), leverage falling (3.25x → 1.73x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.7% | 1.09 | 3.25 | 2.6% |
| FY2024 | ₹0Cr | ₹0Cr | 0.6% | 1.00 | 3.03 | 1.7% |
| FY2025 | ₹0Cr | ₹0Cr | 5.9% | 1.02 | 1.73 | 10.5% |
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.