DuPont Decomposition
Why does VITAL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.4% = 3.0% × 0.74 × 1.96
Latest: FY2025
Profitability
Net Margin
3.0%
13.7% →3.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.74x
0.71x →0.74x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.96x
5.56x →1.96x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 49.7 pp over 4 years. Driven by net margin declining (13.7% → 3.0%), leverage falling (5.56x → 1.96x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 13.7% | 0.71 | 5.56 | 54.0% |
| FY2023 | ₹0Cr | ₹0Cr | 6.9% | 0.85 | 1.54 | 9.0% |
| FY2024 | ₹0Cr | ₹-0Cr | -1.3% | 0.71 | 1.63 | -1.5% |
| FY2025 | ₹0Cr | ₹0Cr | 3.0% | 0.74 | 1.96 | 4.4% |
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.