DuPont Decomposition
Why does PENINLAND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-15.7% = -14.4% × 0.26 × 4.17
Latest: FY2025
Profitability
Net Margin
-14.4%
10.0% →-14.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.26x
0.81x →0.26x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.17x
69.37x →4.17x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 573.6 pp over 3 years. Driven by net margin declining (10.0% → -14.4%), asset turnover declining (0.81x → 0.26x), leverage falling (69.37x → 4.17x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.0% | 0.81 | 69.37 | 558.0% |
| FY2024 | ₹0Cr | ₹0Cr | 23.1% | 0.56 | 4.07 | 52.3% |
| FY2025 | ₹0Cr | ₹-0Cr | -14.4% | 0.26 | 4.17 | -15.7% |
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.