DuPont Decomposition
Why does TFCILTD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.4% = 47.9% × 0.11 × 1.83
Latest: FY2026
Profitability
Net Margin
47.9%
34.2% →47.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.11x
0.11x →0.11x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.83x
2.40x →1.83x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~9%. Driven by net margin improving (34.2% → 47.9%), leverage falling (2.40x → 1.83x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 34.2% | 0.11 | 2.40 | 9.1% |
| FY2023 | ₹0Cr | ₹0Cr | 38.9% | 0.11 | 2.01 | 8.7% |
| FY2024 | ₹0Cr | ₹0Cr | 40.4% | 0.11 | 1.93 | 8.4% |
| FY2025 | ₹0Cr | ₹0Cr | 46.7% | 0.11 | 1.73 | 8.5% |
| FY2026 | ₹0Cr | ₹0Cr | 47.9% | 0.11 | 1.83 | 9.4% |
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.