DuPont Decomposition
Why does RANEHOLDIN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.5% = 1.7% × 1.53 × 3.33
Latest: FY2026
Profitability
Net Margin
1.7%
0.9% →1.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.53x
1.07x →1.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.33x
3.18x →3.33x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 5.4 pp over 5 years. Driven by asset turnover improving (1.07x → 1.53x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 0.9% | 1.07 | 3.18 | 3.1% |
| FY2023 | ₹0Cr | ₹0Cr | 1.8% | 1.33 | 3.21 | 7.7% |
| FY2024 | ₹0Cr | ₹0Cr | 3.6% | 1.31 | 2.92 | 13.7% |
| FY2025 | ₹0Cr | ₹0Cr | 4.8% | 1.22 | 3.22 | 18.7% |
| FY2026 | ₹0Cr | ₹0Cr | 1.7% | 1.53 | 3.33 | 8.5% |
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.