DuPont Decomposition
Why does TVSSRICHAK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.7% = 0.6% × 1.09 × 2.52
Latest: FY2025
Profitability
Net Margin
0.6%
3.3% →0.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.09x
0.28x →1.09x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.52x
2.37x →2.52x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~2%. Driven by net margin declining (3.3% → 0.6%), asset turnover improving (0.28x → 1.09x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.3% | 0.28 | 2.37 | 2.2% |
| FY2024 | ₹0Cr | ₹0Cr | 3.1% | 0.28 | 2.42 | 2.1% |
| FY2025 | ₹0Cr | ₹0Cr | 0.6% | 1.09 | 2.52 | 1.7% |
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.