DuPont Decomposition
Why does VERANDA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
11.0% = 21.9% × 0.26 × 1.91
Latest: FY2026
Profitability
Net Margin
21.9%
-78.4% →21.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.26x
0.20x →0.26x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.91x
4.95x →1.91x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 87.0 pp over 5 years. Driven by net margin improving (-78.4% → 21.9%), leverage falling (4.95x → 1.91x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -78.4% | 0.20 | 4.95 | -76.0% |
| FY2023 | ₹0Cr | ₹-0Cr | -49.1% | 0.18 | 2.91 | -25.9% |
| FY2024 | ₹0Cr | ₹-0Cr | -22.6% | 0.22 | 4.35 | -21.4% |
| FY2025 | ₹0Cr | ₹-0Cr | -69.2% | 0.19 | 7.32 | -96.3% |
| FY2026 | ₹0Cr | ₹0Cr | 21.9% | 0.26 | 1.91 | 11.0% |
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.