DuPont Decomposition
Why does RAMKY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.6% = 9.7% × 0.49 × 2.03
Latest: FY2025
Profitability
Net Margin
9.7%
63.2% →9.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.49x
0.37x →0.49x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.03x
3.29x →2.03x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 66.8 pp over 3 years. Driven by net margin declining (63.2% → 9.7%), asset turnover improving (0.37x → 0.49x), leverage falling (3.29x → 2.03x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 63.2% | 0.37 | 3.29 | 76.3% |
| FY2024 | ₹0Cr | ₹0Cr | 14.3% | 0.51 | 2.49 | 18.0% |
| FY2025 | ₹0Cr | ₹0Cr | 9.7% | 0.49 | 2.03 | 9.6% |
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.