DuPont Decomposition
Why does RAJOOENG earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
23.4% = 15.2% × 0.77 × 1.99
Latest: FY2025
Profitability
Net Margin
15.2%
8.2% →15.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.77x
1.15x →0.77x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.99x
1.62x →1.99x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.1 pp over 4 years. Driven by net margin improving (8.2% → 15.2%), asset turnover declining (1.15x → 0.77x), leverage rising (1.62x → 1.99x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 8.2% | 1.15 | 1.62 | 15.3% |
| FY2023 | ₹0Cr | ₹0Cr | 7.3% | 0.87 | 1.66 | 10.6% |
| FY2024 | ₹0Cr | ₹0Cr | 10.8% | 0.85 | 1.79 | 16.6% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 0.77 | 1.99 | 23.4% |
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.