DuPont Decomposition
Why does RADHIKAJWE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
18.6% = 10.2% × 1.56 × 1.16
Latest: FY2025
Profitability
Net Margin
10.2%
11.6% →10.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.56x
1.10x →1.56x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.16x
1.12x →1.16x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.2 pp over 4 years. Driven by net margin declining (11.6% → 10.2%), asset turnover improving (1.10x → 1.56x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.6% | 1.10 | 1.12 | 14.4% |
| FY2023 | ₹0Cr | ₹0Cr | 9.5% | 1.21 | 1.20 | 13.8% |
| FY2024 | ₹0Cr | ₹0Cr | 9.1% | 1.69 | 1.21 | 18.7% |
| FY2025 | ₹0Cr | ₹0Cr | 10.2% | 1.56 | 1.16 | 18.6% |
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.