DuPont Decomposition
Why does PRUDMOULI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.1% = 6.2% × 0.48 × 1.73
Latest: FY2025
Profitability
Net Margin
6.2%
4.8% →6.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.48x
0.44x →0.48x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.73x
1.26x →1.73x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.5 pp over 4 years. Driven by net margin improving (4.8% → 6.2%), leverage rising (1.26x → 1.73x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.8% | 0.44 | 1.26 | 2.6% |
| FY2023 | ₹0Cr | ₹0Cr | 5.9% | 0.64 | 1.26 | 4.7% |
| FY2024 | ₹0Cr | ₹0Cr | 6.0% | 0.68 | 1.45 | 5.9% |
| FY2025 | ₹0Cr | ₹0Cr | 6.2% | 0.48 | 1.73 | 5.1% |
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.