DuPont Decomposition
Why does PGIL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.7% = 5.6% × 1.70 × 2.26
Latest: FY2025
Profitability
Net Margin
5.6%
4.9% →5.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.70x
1.71x →1.70x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.26x
2.46x →2.26x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~22%. Driven by leverage falling (2.46x → 2.26x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.9% | 1.71 | 2.46 | 20.7% |
| FY2024 | ₹0Cr | ₹0Cr | 5.2% | 1.70 | 2.48 | 21.8% |
| FY2025 | ₹0Cr | ₹0Cr | 5.6% | 1.70 | 2.26 | 21.7% |
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.