DuPont Decomposition
Why does UTLSOLAR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
39.4% = 10.2% × 1.52 × 2.56
Latest: FY2025
Profitability
Net Margin
10.2%
5.6% →10.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.52x
1.27x →1.52x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.56x
2.21x →2.56x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 23.6 pp over 4 years. Driven by net margin improving (5.6% → 10.2%), asset turnover improving (1.27x → 1.52x), leverage rising (2.21x → 2.56x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.6% | 1.27 | 2.21 | 15.8% |
| FY2023 | ₹0Cr | ₹0Cr | 3.7% | 1.29 | 2.66 | 12.6% |
| FY2024 | ₹0Cr | ₹0Cr | 4.9% | 1.51 | 2.55 | 18.9% |
| FY2025 | ₹0Cr | ₹0Cr | 10.2% | 1.52 | 2.56 | 39.4% |
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.