DuPont Decomposition
Why does RADICO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.6% = 7.2% × 1.04 × 1.68
Latest: FY2025
Profitability
Net Margin
7.2%
1.3% →7.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.04x
0.91x →1.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.68x
1.68x →1.68x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 10.6 pp over 3 years. Driven by net margin improving (1.3% → 7.2%), asset turnover improving (0.91x → 1.04x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 1.3% | 0.91 | 1.68 | 1.9% |
| FY2024 | ₹0Cr | ₹0Cr | 1.5% | 0.97 | 1.70 | 2.4% |
| FY2025 | ₹0Cr | ₹0Cr | 7.2% | 1.04 | 1.68 | 12.6% |
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.