DuPont Decomposition
Why does XPROINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.2% = 7.2% × 0.53 × 1.63
Latest: FY2025
Profitability
Net Margin
7.2%
9.0% →7.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.53x
1.48x →0.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.63x
1.46x →1.63x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 13.2 pp over 3 years. Driven by net margin declining (9.0% → 7.2%), asset turnover declining (1.48x → 0.53x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.0% | 1.48 | 1.46 | 19.4% |
| FY2024 | ₹0Cr | ₹0Cr | 9.5% | 0.68 | 1.21 | 7.8% |
| FY2025 | ₹0Cr | ₹0Cr | 7.2% | 0.53 | 1.63 | 6.2% |
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.