DuPont Decomposition
Why does RELIABLE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.8% = 6.9% × 0.86 × 2.67
Latest: FY2025
Profitability
Net Margin
6.9%
6.5% →6.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.86x
0.70x →0.86x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.67x
2.01x →2.67x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.6 pp over 4 years. Driven by asset turnover improving (0.70x → 0.86x), leverage rising (2.01x → 2.67x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.5% | 0.70 | 2.01 | 9.2% |
| FY2023 | ₹0Cr | ₹0Cr | 5.5% | 0.64 | 2.57 | 8.9% |
| FY2024 | ₹0Cr | ₹0Cr | 6.3% | 0.65 | 2.50 | 10.2% |
| FY2025 | ₹0Cr | ₹0Cr | 6.9% | 0.86 | 2.67 | 15.8% |
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.