DuPont Decomposition
Why does PRESTIGE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.3% = 9.4% × 0.17 × 4.51
Latest: FY2026
Profitability
Net Margin
9.4%
18.3% →9.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.17x
0.21x →0.17x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.51x
3.35x →4.51x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 5.3 pp over 5 years. Driven by net margin declining (18.3% → 9.4%), leverage rising (3.35x → 4.51x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 18.3% | 0.21 | 3.35 | 12.6% |
| FY2023 | ₹0Cr | ₹0Cr | 11.5% | 0.22 | 3.67 | 9.4% |
| FY2024 | ₹0Cr | ₹0Cr | 17.6% | 0.16 | 4.30 | 12.2% |
| FY2025 | ₹0Cr | ₹0Cr | 6.4% | 0.12 | 3.81 | 3.0% |
| FY2026 | ₹0Cr | ₹0Cr | 9.4% | 0.17 | 4.51 | 7.3% |
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.