DuPont Decomposition
Why does POLYMED earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.7% = 17.7% × 0.48 × 1.26
Latest: FY2026
Profitability
Net Margin
17.7%
16.0% →17.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.48x
0.67x →0.48x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.26x
1.27x →1.26x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.8 pp over 5 years. Driven by net margin improving (16.0% → 17.7%), asset turnover declining (0.67x → 0.48x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 16.0% | 0.67 | 1.27 | 13.5% |
| FY2023 | ₹0Cr | ₹0Cr | 16.2% | 0.70 | 1.27 | 14.4% |
| FY2024 | ₹0Cr | ₹0Cr | 18.9% | 0.73 | 1.26 | 17.6% |
| FY2025 | ₹0Cr | ₹0Cr | 20.3% | 0.52 | 1.15 | 12.2% |
| FY2026 | ₹0Cr | ₹0Cr | 17.7% | 0.48 | 1.26 | 10.7% |
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.