DuPont Decomposition
Why does UBL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
9.1% = 4.5% × 0.95 × 2.14
Latest: FY2026
Profitability
Net Margin
4.5%
6.5% →4.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.95x
0.94x →0.95x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.14x
1.51x →2.14x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~9%. Driven by net margin declining (6.5% → 4.5%), leverage rising (1.51x → 2.14x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.5% | 0.94 | 1.51 | 9.3% |
| FY2023 | ₹0Cr | ₹0Cr | 4.2% | 1.17 | 1.58 | 7.7% |
| FY2024 | ₹0Cr | ₹0Cr | 5.2% | 1.12 | 1.69 | 9.8% |
| FY2025 | ₹0Cr | ₹0Cr | 5.0% | 1.08 | 1.88 | 10.1% |
| FY2026 | ₹0Cr | ₹0Cr | 4.5% | 0.95 | 2.14 | 9.1% |
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.