Performance Evaluation of Industrial and Commercial bank of China based on DuPont Analysis

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Qiaopeng Ma 1,* Xi Wang 1

1. DuPont analysis, Chain substitution method, Return on equity, Performance evaluation

* Corresponding author.


Received: 30 Oct. 2022 / Revised: 25 Nov. 2022 / Accepted: 20 Dec. 2022 / Published: 8 Feb. 2023

Index Terms

DuPont analysis, Chain substitution method, Return on equity, Performance evaluation


With the reform of Chinese economic system, the development of enterprises is facing many risks and challenges. In order to understand the state of operation of enterprises, it is necessary to apply relevant methods to evaluate the enterprise performance. Taking Industrial and Commercial Bank of China as an example, this paper selects its financial data from 2018 to 2021. Firstly, DuPont analysis is applied to decompose the return on equity into the product of profit margin on sales, total assets turnover ratio and equity multiplier. Then analyzes the effect of the changes of these three factors on the return on equity respectively by using the Chain substitution method. The results show that the effect of profit margin on sales on return on equity decreases year by year and tends to be positive from negative. The effect of total assets turnover ratio on return on equity changes from positive to negative and then to positive, while the effect of equity multiplier is opposite. These results provide a direction for the adjustment of the return on equity of Industrial and Commercial Bank of China. Finally, according to the results, some suggestions are put forward for the development of Industrial and Commercial Bank of China.

Cite This Paper

Qiaopeng Ma, Xi Wang, "Performance Evaluation of Industrial and Commercial bank of China based on DuPont Analysis", International Journal of Mathematical Sciences and Computing(IJMSC), Vol.9, No.1, pp. 37-44, 2023. DOI: 10.5815/ijmsc.2023.01.04


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