DuPont Decomposition
Why does TATAELXSI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
27.4% = 21.1% × 1.04 × 1.25
Latest: FY2025
Profitability
Net Margin
21.1%
24.1% →21.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.04x
0.30x →1.04x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.25x
1.32x →1.25x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 17.8 pp over 3 years. Driven by net margin declining (24.1% → 21.1%), asset turnover improving (0.30x → 1.04x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 24.1% | 0.30 | 1.32 | 9.7% |
| FY2024 | ₹0Cr | ₹0Cr | 21.7% | 0.28 | 1.27 | 7.9% |
| FY2025 | ₹0Cr | ₹0Cr | 21.1% | 1.04 | 1.25 | 27.4% |
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.