DuPont Decomposition
Why does RISHABH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.7% = 3.2% × 0.80 × 1.44
Latest: FY2025
Profitability
Net Margin
3.2%
10.1% →3.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.80x
0.83x →0.80x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.44x
1.63x →1.44x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 9.9 pp over 4 years. Driven by net margin declining (10.1% → 3.2%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 10.1% | 0.83 | 1.63 | 13.6% |
| FY2023 | ₹0Cr | ₹0Cr | 8.3% | 0.87 | 1.59 | 11.4% |
| FY2024 | ₹0Cr | ₹0Cr | 5.8% | 0.87 | 1.40 | 7.1% |
| FY2025 | ₹0Cr | ₹0Cr | 3.2% | 0.80 | 1.44 | 3.7% |
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.