DuPont Decomposition
Why does VADILALIND earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.6% = 12.2% × 1.13 × 1.58
Latest: FY2025
Profitability
Net Margin
12.2%
9.1% →12.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.13x
1.26x →1.13x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.58x
2.11x →1.58x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.6 pp over 3 years. Driven by net margin improving (9.1% → 12.2%), asset turnover declining (1.26x → 1.13x), leverage falling (2.11x → 1.58x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.1% | 1.26 | 2.11 | 24.2% |
| FY2024 | ₹0Cr | ₹0Cr | 13.0% | 1.22 | 1.69 | 26.9% |
| FY2025 | ₹0Cr | ₹0Cr | 12.2% | 1.13 | 1.58 | 21.6% |
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.