DuPont Decomposition
Why does VINCOFE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.3% = 13.0% × 0.75 × 1.35
Latest: FY2025
Profitability
Net Margin
13.0%
-33.5% →13.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.75x
0.15x →0.75x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.35x
2.35x →1.35x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 25.0 pp over 4 years. Driven by net margin improving (-33.5% → 13.0%), asset turnover improving (0.15x → 0.75x), leverage falling (2.35x → 1.35x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -33.5% | 0.15 | 2.35 | -11.7% |
| FY2023 | ₹0Cr | ₹0Cr | 6.1% | 0.26 | 2.27 | 3.6% |
| FY2024 | ₹0Cr | ₹0Cr | 9.1% | 0.46 | 1.73 | 7.2% |
| FY2025 | ₹0Cr | ₹0Cr | 13.0% | 0.75 | 1.35 | 13.3% |
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.