DuPont Decomposition
Why does PERSISTENT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
22.2% = 11.7% × 1.37 × 1.38
Latest: FY2025
Profitability
Net Margin
11.7%
17.4% →11.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.37x
0.30x →1.37x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.38x
1.24x →1.38x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.6 pp over 3 years. Driven by net margin declining (17.4% → 11.7%), asset turnover improving (0.30x → 1.37x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 17.4% | 0.30 | 1.24 | 6.6% |
| FY2024 | ₹0Cr | ₹0Cr | 11.3% | 0.27 | 1.27 | 3.9% |
| FY2025 | ₹0Cr | ₹0Cr | 11.7% | 1.37 | 1.38 | 22.2% |
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.