DuPont Decomposition
Why does POWERICA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.3% = 6.3% × 1.09 × 2.21
Latest: FY2025
Profitability
Net Margin
6.3%
4.5% →6.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.09x
1.11x →1.09x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.21x
2.68x →2.21x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 1.8 pp over 3 years. Driven by net margin improving (4.5% → 6.3%), leverage falling (2.68x → 2.21x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.5% | 1.11 | 2.68 | 13.4% |
| FY2024 | ₹0Cr | ₹0Cr | 10.3% | 1.05 | 2.29 | 24.8% |
| FY2025 | ₹0Cr | ₹0Cr | 6.3% | 1.09 | 2.21 | 15.3% |
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.