DuPont Decomposition
Why does TITAGARH earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.1% = 7.2% × 1.03 × 1.51
Latest: FY2025
Profitability
Net Margin
7.2%
4.7% →7.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.03x
1.36x →1.03x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.51x
2.10x →1.51x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.4 pp over 3 years. Driven by net margin improving (4.7% → 7.2%), asset turnover declining (1.36x → 1.03x), leverage falling (2.10x → 1.51x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.7% | 1.36 | 2.10 | 13.5% |
| FY2024 | ₹0Cr | ₹0Cr | 7.5% | 0.33 | 1.45 | 3.5% |
| FY2025 | ₹0Cr | ₹0Cr | 7.2% | 1.03 | 1.51 | 11.1% |
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.