DuPont Decomposition
Why does ZFCVINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.3% = 12.1% × 1.00 × 1.18
Latest: FY2025
Profitability
Net Margin
12.1%
10.4% →12.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.00x
0.32x →1.00x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.18x
1.25x →1.18x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 10.1 pp over 3 years. Driven by net margin improving (10.4% → 12.1%), asset turnover improving (0.32x → 1.00x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.4% | 0.32 | 1.25 | 4.2% |
| FY2024 | ₹0Cr | ₹0Cr | 10.4% | 0.28 | 1.21 | 3.6% |
| FY2025 | ₹0Cr | ₹0Cr | 12.1% | 1.00 | 1.18 | 14.3% |
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.