DuPont Decomposition
Why does WHEELS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.9% = 2.8% × 1.55 × 3.39
Latest: FY2026
Profitability
Net Margin
2.8%
2.1% →2.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.55x
1.22x →1.55x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.39x
4.05x →3.39x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.5 pp over 5 years. Driven by asset turnover improving (1.22x → 1.55x), leverage falling (4.05x → 3.39x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.1% | 1.22 | 4.05 | 10.4% |
| FY2023 | ₹0Cr | ₹0Cr | 1.3% | 1.39 | 3.89 | 7.1% |
| FY2024 | ₹0Cr | ₹0Cr | 1.4% | 1.48 | 3.70 | 7.5% |
| FY2025 | ₹0Cr | ₹0Cr | 2.3% | 1.49 | 3.46 | 12.0% |
| FY2026 | ₹0Cr | ₹0Cr | 2.8% | 1.55 | 3.39 | 14.9% |
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.