DuPont Decomposition
Why does VERTOZ earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.7% = 10.2% × 1.01 × 1.33
Latest: FY2025
Profitability
Net Margin
10.2%
13.3% →10.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.01x
0.64x →1.01x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.33x
1.27x →1.33x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.9 pp over 3 years. Driven by net margin declining (13.3% → 10.2%), asset turnover improving (0.64x → 1.01x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 13.3% | 0.64 | 1.27 | 10.8% |
| FY2024 | ₹0Cr | ₹0Cr | 10.2% | 0.79 | 1.25 | 10.0% |
| FY2025 | ₹0Cr | ₹0Cr | 10.2% | 1.01 | 1.33 | 13.7% |
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.