DuPont Decomposition
Why does WCIL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.5% = 2.1% × 1.52 × 1.39
Latest: FY2026
Profitability
Net Margin
2.1%
4.2% →2.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.52x
3.00x →1.52x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.39x
1.91x →1.39x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 19.3 pp over 5 years. Driven by net margin declining (4.2% → 2.1%), asset turnover declining (3.00x → 1.52x), leverage falling (1.91x → 1.39x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.2% | 3.00 | 1.91 | 23.8% |
| FY2023 | ₹0Cr | ₹0Cr | 4.4% | 2.70 | 1.90 | 22.5% |
| FY2024 | ₹0Cr | ₹0Cr | 4.8% | 2.24 | 1.89 | 20.2% |
| FY2025 | ₹0Cr | ₹0Cr | 3.8% | 1.56 | 1.33 | 7.9% |
| FY2026 | ₹0Cr | ₹0Cr | 2.1% | 1.52 | 1.39 | 4.5% |
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.