DuPont Decomposition
Why does RAMCOCEM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.6% = 7.7% × 0.54 × 2.06
Latest: FY2026
Profitability
Net Margin
7.7%
14.8% →7.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.54x
0.45x →0.54x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.06x
1.99x →2.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 4.7 pp over 5 years. Driven by net margin declining (14.8% → 7.7%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 14.8% | 0.45 | 1.99 | 13.3% |
| FY2023 | ₹0Cr | ₹0Cr | 3.9% | 0.56 | 2.13 | 4.6% |
| FY2024 | ₹0Cr | ₹0Cr | 3.9% | 0.57 | 2.25 | 5.0% |
| FY2025 | ₹0Cr | ₹0Cr | 3.2% | 0.52 | 2.19 | 3.7% |
| FY2026 | ₹0Cr | ₹0Cr | 7.7% | 0.54 | 2.06 | 8.6% |
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.