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
20.7% = 16.7% × 0.95 × 1.30
Latest: FY2026
Profitability
Net Margin
16.7%
24.0% →16.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.95x
1.14x →0.95x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.30x
1.32x →1.30x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 15.6 pp over 4 years. Driven by net margin declining (24.0% → 16.7%), asset turnover declining (1.14x → 0.95x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 24.0% | 1.14 | 1.32 | 36.2% |
| FY2024 | ₹0Cr | ₹0Cr | 22.3% | 1.11 | 1.27 | 31.6% |
| FY2025 | ₹0Cr | ₹0Cr | 21.1% | 1.04 | 1.25 | 27.4% |
| FY2026 | ₹0Cr | ₹0Cr | 16.7% | 0.95 | 1.30 | 20.7% |
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.