DuPont Decomposition
Why does NUVAMA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
25.3% = 45.6% × 0.07 × 8.37
Latest: FY2026
Profitability
Net Margin
45.6%
23.1% →45.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.07x
0.10x →0.07x
Revenue per ₹ of assets
Leverage
Equity Multiplier
8.37x
5.64x →8.37x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 11.7 pp over 4 years. Driven by net margin improving (23.1% → 45.6%), leverage rising (5.64x → 8.37x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 23.1% | 0.10 | 5.64 | 13.5% |
| FY2024 | ₹0Cr | ₹0Cr | 36.0% | 0.09 | 7.04 | 21.6% |
| FY2025 | ₹0Cr | ₹0Cr | 46.1% | 0.08 | 8.13 | 28.3% |
| FY2026 | ₹0Cr | ₹0Cr | 45.6% | 0.07 | 8.37 | 25.3% |
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.