DuPont Decomposition
Why does RATEGAIN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.7% = 10.7% × 0.51 × 1.77
Latest: FY2026
Profitability
Net Margin
10.7%
2.3% →10.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.51x
0.47x →0.51x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.77x
1.26x →1.77x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.3 pp over 5 years. Driven by net margin improving (2.3% → 10.7%), leverage rising (1.26x → 1.77x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.3% | 0.47 | 1.26 | 1.4% |
| FY2023 | ₹0Cr | ₹0Cr | 12.1% | 0.60 | 1.33 | 9.6% |
| FY2024 | ₹0Cr | ₹0Cr | 15.2% | 0.55 | 1.19 | 10.0% |
| FY2025 | ₹0Cr | ₹0Cr | 19.4% | 0.57 | 1.13 | 12.4% |
| FY2026 | ₹0Cr | ₹0Cr | 10.7% | 0.51 | 1.77 | 9.7% |
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.