DuPont Decomposition
Why does PREMIERPOL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
22.1% = 8.7% × 1.83 × 1.40
Latest: FY2025
Profitability
Net Margin
8.7%
4.0% →8.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.83x
2.00x →1.83x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.40x
1.91x →1.40x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.6 pp over 4 years. Driven by net margin improving (4.0% → 8.7%), asset turnover declining (2.00x → 1.83x), leverage falling (1.91x → 1.40x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.0% | 2.00 | 1.91 | 15.5% |
| FY2023 | ₹0Cr | ₹0Cr | 4.1% | 2.08 | 1.87 | 15.8% |
| FY2024 | ₹0Cr | ₹0Cr | 7.0% | 2.21 | 1.41 | 21.8% |
| FY2025 | ₹0Cr | ₹0Cr | 8.7% | 1.83 | 1.40 | 22.1% |
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.