DuPont Decomposition
Why does RSSOFTWARE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.9% = 15.2% × 0.79 × 1.24
Latest: FY2025
Profitability
Net Margin
15.2%
-55.0% →15.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.79x
0.58x →0.79x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.24x
1.20x →1.24x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 52.9 pp over 4 years. Driven by net margin improving (-55.0% → 15.2%), asset turnover improving (0.58x → 0.79x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -55.0% | 0.58 | 1.20 | -38.1% |
| FY2023 | ₹0Cr | ₹-0Cr | -27.0% | 0.70 | 1.41 | -26.5% |
| FY2024 | ₹0Cr | ₹0Cr | 30.4% | 0.87 | 1.39 | 36.9% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 0.79 | 1.24 | 14.9% |
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.