DuPont Decomposition
Why does WSTCSTPAPR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.6% = 7.7% × 0.73 × 1.35
Latest: FY2025
Profitability
Net Margin
7.7%
19.3% →7.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.73x
1.17x →0.73x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.35x
1.62x →1.35x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 28.9 pp over 3 years. Driven by net margin declining (19.2% → 7.7%), asset turnover declining (1.17x → 0.73x), leverage falling (1.62x → 1.35x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 19.3% | 1.17 | 1.62 | 36.5% |
| FY2024 | ₹0Cr | ₹0Cr | 15.7% | 0.86 | 1.58 | 21.4% |
| FY2025 | ₹0Cr | ₹0Cr | 7.7% | 0.73 | 1.35 | 7.6% |
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.