DuPont Decomposition
Why does REMSONSIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.4% = 4.5% × 1.20 × 2.28
Latest: FY2025
Profitability
Net Margin
4.5%
1.9% →4.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.20x
1.63x →1.20x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.28x
5.06x →2.28x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.1 pp over 4 years. Driven by net margin improving (1.9% → 4.5%), asset turnover declining (1.63x → 1.20x), leverage falling (5.06x → 2.28x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.9% | 1.63 | 5.06 | 15.5% |
| FY2023 | ₹0Cr | ₹0Cr | 2.7% | 1.64 | 4.50 | 19.8% |
| FY2024 | ₹0Cr | ₹0Cr | 4.3% | 1.31 | 2.13 | 12.0% |
| FY2025 | ₹0Cr | ₹0Cr | 4.5% | 1.20 | 2.28 | 12.4% |
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.