DuPont Decomposition
Why does USK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-4.3% = -2.5% × 0.88 × 1.96
Latest: FY2025
Profitability
Net Margin
-2.5%
6.5% →-2.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.88x
1.14x →0.88x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.96x
2.38x →1.96x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 22.1 pp over 4 years. Driven by net margin declining (6.5% → -2.5%), asset turnover declining (1.14x → 0.88x), leverage falling (2.38x → 1.96x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.5% | 1.14 | 2.38 | 17.8% |
| FY2023 | ₹0Cr | ₹0Cr | 5.6% | 1.01 | 1.97 | 11.1% |
| FY2024 | ₹0Cr | ₹0Cr | 5.2% | 1.79 | 1.84 | 17.2% |
| FY2025 | ₹0Cr | ₹-0Cr | -2.5% | 0.88 | 1.96 | -4.3% |
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.