DuPont Decomposition
Why does RPPL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.9% = 2.4% × 1.02 × 1.98
Latest: FY2025
Profitability
Net Margin
2.4%
4.8% →2.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.02x
1.03x →1.02x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.98x
1.66x →1.98x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.3 pp over 4 years. Driven by net margin declining (4.8% → 2.4%), leverage rising (1.66x → 1.98x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.8% | 1.03 | 1.66 | 8.3% |
| FY2023 | ₹0Cr | ₹0Cr | 4.2% | 0.96 | 2.02 | 8.2% |
| FY2024 | ₹0Cr | ₹0Cr | 3.2% | 0.97 | 1.83 | 5.6% |
| FY2025 | ₹0Cr | ₹0Cr | 2.4% | 1.02 | 1.98 | 4.9% |
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.