DuPont Decomposition
Why does VIKRAN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.6% = 8.5% × 0.67 × 2.90
Latest: FY2025
Profitability
Net Margin
8.5%
8.2% →8.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.67x
0.74x →0.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.90x
5.43x →2.90x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 16.0 pp over 3 years. Driven by leverage falling (5.43x → 2.90x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 8.2% | 0.74 | 5.43 | 32.7% |
| FY2024 | ₹0Cr | ₹0Cr | 9.6% | 0.81 | 3.30 | 25.7% |
| FY2025 | ₹0Cr | ₹0Cr | 8.5% | 0.67 | 2.90 | 16.6% |
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.