DuPont Decomposition
Why does EICHERMOT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
22.0% = 24.0% × 0.71 × 1.28
Latest: FY2026
Profitability
Net Margin
24.0%
16.6% →24.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.71x
0.63x →0.71x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.28x
1.28x →1.28x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 8.7 pp over 5 years. Driven by net margin improving (16.6% → 24.0%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 16.6% | 0.63 | 1.28 | 13.3% |
| FY2023 | ₹0Cr | ₹0Cr | 20.6% | 0.74 | 1.28 | 19.4% |
| FY2024 | ₹0Cr | ₹0Cr | 24.6% | 0.70 | 1.28 | 22.2% |
| FY2025 | ₹0Cr | ₹0Cr | 25.5% | 0.68 | 1.28 | 22.2% |
| FY2026 | ₹0Cr | ₹0Cr | 24.0% | 0.71 | 1.28 | 22.0% |
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.