DuPont Decomposition
Why does ROHLTD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
19.1% = 14.8% × 0.59 × 2.18
Latest: FY2025
Profitability
Net Margin
14.8%
18.1% →14.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.59x
0.17x →0.59x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.18x
2.45x →2.18x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 11.5 pp over 3 years. Driven by net margin declining (18.1% → 14.8%), asset turnover improving (0.17x → 0.59x), leverage falling (2.45x → 2.18x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 18.1% | 0.17 | 2.45 | 7.6% |
| FY2024 | ₹0Cr | ₹0Cr | 21.9% | 0.16 | 2.46 | 8.8% |
| FY2025 | ₹0Cr | ₹0Cr | 14.8% | 0.59 | 2.18 | 19.1% |
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.