DuPont Decomposition
Why does VASCONEQ earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.9% = 12.1% × 0.50 × 1.95
Latest: FY2025
Profitability
Net Margin
12.1%
15.2% →12.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.50x
0.20x →0.50x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.95x
1.81x →1.95x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.4 pp over 3 years. Driven by net margin declining (15.2% → 12.1%), asset turnover improving (0.20x → 0.50x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 15.2% | 0.20 | 1.81 | 5.4% |
| FY2024 | ₹0Cr | ₹0Cr | 5.0% | 0.18 | 1.90 | 1.7% |
| FY2025 | ₹0Cr | ₹0Cr | 12.1% | 0.50 | 1.95 | 11.9% |
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.