DuPont Decomposition
Why does ZYDUSLIFE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
17.2% = 20.1% × 0.61 × 1.41
Latest: FY2025
Profitability
Net Margin
20.1%
7.2% →20.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.61x
0.19x →0.61x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.41x
1.47x →1.41x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 15.1 pp over 3 years. Driven by net margin improving (7.2% → 20.1%), asset turnover improving (0.19x → 0.61x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 7.2% | 0.19 | 1.47 | 2.0% |
| FY2024 | ₹0Cr | ₹0Cr | 22.5% | 0.19 | 1.48 | 6.3% |
| FY2025 | ₹0Cr | ₹0Cr | 20.1% | 0.61 | 1.41 | 17.2% |
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.