DuPont Decomposition
Why does AUBANK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.2% = 21.9% × 0.06 × 9.60
Latest: FY2026
Profitability
Net Margin
21.9%
26.7% →21.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.06x
0.06x →0.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
9.60x
9.19x →9.60x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.8 pp over 5 years. Driven by net margin declining (26.7% → 21.9%), leverage rising (9.19x → 9.60x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 26.7% | 0.06 | 9.19 | 15.0% |
| FY2023 | ₹0Cr | ₹0Cr | 26.1% | 0.06 | 8.22 | 13.0% |
| FY2024 | ₹0Cr | ₹0Cr | 22.4% | 0.06 | 8.71 | 12.2% |
| FY2025 | ₹0Cr | ₹0Cr | 20.0% | 0.07 | 9.20 | 12.3% |
| FY2026 | ₹0Cr | ₹0Cr | 21.9% | 0.06 | 9.60 | 13.2% |
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.