DuPont Decomposition
Why does VASWANI earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.3% = 2.1% × 1.14 × 2.63
Latest: FY2025
Profitability
Net Margin
2.1%
1.2% →2.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.14x
1.73x →1.14x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.63x
2.03x →2.63x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.1 pp over 4 years. Driven by asset turnover declining (1.73x → 1.14x), leverage rising (2.03x → 2.63x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.2% | 1.73 | 2.03 | 4.1% |
| FY2023 | ₹0Cr | ₹0Cr | 1.5% | 1.95 | 1.79 | 5.3% |
| FY2024 | ₹0Cr | ₹0Cr | 2.3% | 2.06 | 1.55 | 7.4% |
| FY2025 | ₹0Cr | ₹0Cr | 2.1% | 1.14 | 2.63 | 6.3% |
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.