DuPont Decomposition
Why does PATANJALI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.4% = 3.8% × 2.20 × 1.36
Latest: FY2025
Profitability
Net Margin
3.8%
2.8% →3.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.20x
2.38x →2.20x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.36x
1.34x →1.36x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.4 pp over 3 years. Driven by asset turnover declining (2.38x → 2.20x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 2.8% | 2.38 | 1.34 | 9.0% |
| FY2024 | ₹0Cr | ₹0Cr | 2.4% | 2.39 | 1.30 | 7.5% |
| FY2025 | ₹0Cr | ₹0Cr | 3.8% | 2.20 | 1.36 | 11.4% |
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.