DuPont Decomposition
Why does RVTH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.8% = 9.7% × 0.53 × 1.91
Latest: FY2026
Profitability
Net Margin
9.7%
11.2% →9.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.53x
0.80x →0.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.91x
2.00x →1.91x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.1 pp over 5 years. Driven by net margin declining (11.2% → 9.7%), asset turnover declining (0.80x → 0.53x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.2% | 0.80 | 2.00 | 18.0% |
| FY2023 | ₹0Cr | ₹0Cr | 12.2% | 0.68 | 2.12 | 17.7% |
| FY2024 | ₹0Cr | ₹0Cr | 14.7% | 0.89 | 2.24 | 29.1% |
| FY2025 | ₹0Cr | ₹0Cr | 11.3% | 0.75 | 1.89 | 16.0% |
| FY2026 | ₹0Cr | ₹0Cr | 9.7% | 0.53 | 1.91 | 9.8% |
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.