DuPont Decomposition
Why does TALBROAUTO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.0% = 12.0% × 0.80 × 1.46
Latest: FY2026
Profitability
Net Margin
12.0%
8.3% →12.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.80x
0.95x →0.80x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.46x
1.89x →1.46x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~14%. Driven by net margin improving (8.3% → 12.0%), asset turnover declining (0.95x → 0.80x), leverage falling (1.89x → 1.46x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 8.3% | 0.95 | 1.89 | 14.9% |
| FY2023 | ₹0Cr | ₹0Cr | 9.2% | 0.93 | 1.78 | 15.1% |
| FY2024 | ₹0Cr | ₹0Cr | 15.1% | 0.85 | 1.59 | 20.5% |
| FY2025 | ₹0Cr | ₹0Cr | 11.4% | 0.87 | 1.50 | 14.9% |
| FY2026 | ₹0Cr | ₹0Cr | 12.0% | 0.80 | 1.46 | 14.0% |
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.