DuPont Decomposition
Why does PRIMO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
0.9% = 0.6% × 0.75 × 1.90
Latest: FY2025
Profitability
Net Margin
0.6%
13.0% →0.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.75x
0.95x →0.75x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.90x
1.73x →1.90x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 20.5 pp over 4 years. Driven by net margin declining (13.0% → 0.6%), asset turnover declining (0.95x → 0.75x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 13.0% | 0.95 | 1.73 | 21.4% |
| FY2023 | ₹0Cr | ₹0Cr | 19.4% | 0.97 | 1.77 | 33.3% |
| FY2024 | ₹0Cr | ₹-0Cr | -6.4% | 0.56 | 1.85 | -6.5% |
| FY2025 | ₹0Cr | ₹0Cr | 0.6% | 0.75 | 1.90 | 0.9% |
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.