DuPont Decomposition
Why does VGUARD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.0% = 5.2% × 1.61 × 1.56
Latest: FY2026
Profitability
Net Margin
5.2%
6.5% →5.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.61x
1.67x →1.61x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.56x
1.49x →1.56x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 3.2 pp over 5 years. Driven by net margin declining (6.5% → 5.2%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 6.5% | 1.67 | 1.49 | 16.2% |
| FY2023 | ₹0Cr | ₹0Cr | 4.6% | 1.41 | 1.81 | 11.8% |
| FY2024 | ₹0Cr | ₹0Cr | 5.3% | 1.53 | 1.74 | 14.2% |
| FY2025 | ₹0Cr | ₹0Cr | 5.6% | 1.67 | 1.59 | 14.9% |
| FY2026 | ₹0Cr | ₹0Cr | 5.2% | 1.61 | 1.56 | 13.0% |
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.