DuPont Decomposition
Why does CANBK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
16.7% = 30.7% × 0.03 × 16.03
Latest: FY2026
Profitability
Net Margin
30.7%
12.3% →30.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.03x
0.04x →0.03x
Revenue per ₹ of assets
Leverage
Equity Multiplier
16.03x
17.99x →16.03x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.0 pp over 5 years. Driven by net margin improving (12.3% → 30.7%), leverage falling (17.99x → 16.03x). 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 | 12.3% | 0.04 | 17.99 | 8.8% |
| FY2023 | ₹0Cr | ₹0Cr | 20.3% | 0.04 | 17.69 | 14.4% |
| FY2024 | ₹0Cr | ₹0Cr | 23.1% | 0.04 | 16.66 | 16.6% |
| FY2025 | ₹0Cr | ₹0Cr | 24.6% | 0.04 | 16.44 | 16.6% |
| FY2026 | ₹0Cr | ₹0Cr | 30.7% | 0.03 | 16.03 | 16.7% |
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.