DuPont Decomposition
Why does PNBGILTS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.1% = 13.9% × 0.07 × 15.99
Latest: FY2025
Profitability
Net Margin
13.9%
19.7% →13.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.07x
0.05x →0.07x
Revenue per ₹ of assets
Leverage
Equity Multiplier
15.99x
11.74x →15.99x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.5 pp over 4 years. Driven by net margin declining (19.7% → 13.9%), leverage rising (11.74x → 15.99x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 19.7% | 0.05 | 11.74 | 11.6% |
| FY2023 | ₹0Cr | ₹-0Cr | -8.1% | 0.04 | 17.06 | -6.1% |
| FY2024 | ₹0Cr | ₹0Cr | 5.0% | 0.06 | 18.45 | 5.2% |
| FY2025 | ₹0Cr | ₹0Cr | 13.9% | 0.07 | 15.99 | 15.1% |
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.