DuPont Decomposition
Why does VIDYAWIRES earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
24.6% = 2.8% × 4.47 × 1.99
Latest: FY2025
Profitability
Net Margin
2.8%
2.2% →2.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
4.47x
4.33x →4.47x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.99x
2.69x →1.99x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~25%. Driven by asset turnover improving (4.33x → 4.47x), leverage falling (2.69x → 1.99x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.2% | 4.33 | 2.69 | 25.2% |
| FY2023 | ₹0Cr | ₹0Cr | 2.1% | 4.82 | 2.09 | 21.5% |
| FY2024 | ₹0Cr | ₹0Cr | 2.2% | 4.76 | 1.97 | 20.5% |
| FY2025 | ₹0Cr | ₹0Cr | 2.8% | 4.47 | 1.99 | 24.6% |
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.