DuPont Decomposition
Why does PITTIENG earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.6% = 7.2% × 0.84 × 2.23
Latest: FY2025
Profitability
Net Margin
7.2%
5.4% →7.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.84x
1.12x →0.84x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.23x
2.93x →2.23x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 4.0 pp over 3 years. Driven by net margin improving (5.4% → 7.2%), asset turnover declining (1.12x → 0.84x), leverage falling (2.93x → 2.23x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 5.4% | 1.12 | 2.93 | 17.6% |
| FY2024 | ₹0Cr | ₹0Cr | 7.3% | 0.93 | 3.20 | 21.6% |
| FY2025 | ₹0Cr | ₹0Cr | 7.2% | 0.84 | 2.23 | 13.6% |
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.