DuPont Decomposition
Why does UFO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.2% = 2.3% × 0.74 × 1.88
Latest: FY2025
Profitability
Net Margin
2.3%
-0.3% →2.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.74x
0.72x →0.74x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.88x
1.98x →1.88x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.6 pp over 3 years. Driven by net margin improving (-0.3% → 2.3%).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -0.3% | 0.72 | 1.98 | -0.4% |
| FY2024 | ₹0Cr | ₹0Cr | 4.1% | 0.74 | 1.88 | 5.7% |
| FY2025 | ₹0Cr | ₹0Cr | 2.3% | 0.74 | 1.88 | 3.2% |
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.