DuPont Decomposition
Why does PRAJIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.8% = 0.8% × 1.04 × 2.33
Latest: FY2026
Profitability
Net Margin
0.8%
6.5% →0.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.04x
1.03x →1.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.33x
2.42x →2.33x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 14.6 pp over 5 years. Driven by net margin declining (6.5% → 0.8%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.5% | 1.03 | 2.42 | 16.4% |
| FY2023 | ₹0Cr | ₹0Cr | 6.9% | 1.32 | 2.43 | 22.2% |
| FY2024 | ₹0Cr | ₹0Cr | 8.3% | 1.18 | 2.27 | 22.2% |
| FY2025 | ₹0Cr | ₹0Cr | 6.8% | 1.02 | 2.29 | 15.8% |
| FY2026 | ₹0Cr | ₹0Cr | 0.8% | 1.04 | 2.33 | 1.8% |
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.