DuPont Decomposition
Why does RELIGARE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.6% = 13.3% × 0.08 × 3.27
Latest: FY2025
Profitability
Net Margin
13.3%
251.9% →13.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.08x
0.17x →0.08x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.27x
3.02x →3.27x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 127.7 pp over 3 years. Driven by net margin declining (251.9% → 13.3%), leverage rising (3.02x → 3.27x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 251.9% | 0.17 | 3.02 | 131.4% |
| FY2024 | ₹0Cr | ₹0Cr | 9.8% | 0.19 | 3.02 | 5.7% |
| FY2025 | ₹0Cr | ₹0Cr | 13.3% | 0.08 | 3.27 | 3.6% |
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.