DuPont Decomposition
Why does PNGJL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.1% = 2.8% × 2.45 × 2.02
Latest: FY2025
Profitability
Net Margin
2.8%
2.3% →2.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.45x
2.30x →2.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.02x
3.94x →2.02x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 6.4 pp over 4 years. Driven by asset turnover improving (2.30x → 2.45x), leverage falling (3.94x → 2.02x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.3% | 2.30 | 3.94 | 20.4% |
| FY2023 | ₹0Cr | ₹0Cr | 1.6% | 4.24 | 2.91 | 20.3% |
| FY2024 | ₹0Cr | ₹0Cr | 2.5% | 4.17 | 2.74 | 29.0% |
| FY2025 | ₹0Cr | ₹0Cr | 2.8% | 2.45 | 2.02 | 14.1% |
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.