DuPont Decomposition
Why does YUKEN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.2% = 5.4% × 0.87 × 1.74
Latest: FY2025
Profitability
Net Margin
5.4%
2.6% →5.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.87x
0.84x →0.87x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.74x
2.21x →1.74x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.4 pp over 3 years. Driven by net margin improving (2.6% → 5.4%), leverage falling (2.21x → 1.74x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 2.6% | 0.84 | 2.21 | 4.8% |
| FY2024 | ₹0Cr | ₹0Cr | 4.5% | 0.88 | 1.72 | 6.7% |
| FY2025 | ₹0Cr | ₹0Cr | 5.4% | 0.87 | 1.74 | 8.2% |
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.