DuPont Decomposition
Why does UMESLTD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
2.1% = 59.8% × 0.03 × 1.08
Latest: FY2025
Profitability
Net Margin
59.8%
7.7% →59.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.03x
0.04x →0.03x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.08x
1.32x →1.08x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 1.7 pp over 4 years. Driven by net margin improving (7.7% → 59.8%), leverage falling (1.32x → 1.08x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 7.7% | 0.04 | 1.32 | 0.4% |
| FY2023 | ₹0Cr | ₹0Cr | 9.7% | 0.04 | 1.30 | 0.5% |
| FY2024 | ₹0Cr | ₹0Cr | 20.6% | 0.04 | 1.16 | 1.1% |
| FY2025 | ₹0Cr | ₹0Cr | 59.8% | 0.03 | 1.08 | 2.1% |
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.