DuPont Decomposition
Why does PIDILITIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
20.9% = 15.9% × 0.93 × 1.41
Latest: FY2025
Profitability
Net Margin
15.9%
10.9% →15.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.93x
1.12x →0.93x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.41x
1.46x →1.41x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.0 pp over 3 years. Driven by net margin improving (10.9% → 15.9%), asset turnover declining (1.12x → 0.93x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.9% | 1.12 | 1.46 | 17.9% |
| FY2024 | ₹0Cr | ₹0Cr | 14.1% | 1.02 | 1.44 | 20.8% |
| FY2025 | ₹0Cr | ₹0Cr | 15.9% | 0.93 | 1.41 | 20.9% |
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.