The DuPont identity is an expression that shows a company's return on equity

(ROE) can be represented as a product of three other ratios: the profit margin, the
total asset turnover, and the equity multiplier.
The formula for the DuPont identity is:
ROE = profit margin x asset turnover x equity multiplier
This formula, in turn, can be broken down further to:
ROE = (net income / sales) x (revenue / total assets) x (total assets / shareholder
equity)

The Internal Growth Rate The first growth rate of interest is the maximum
growth rate that can be achieved with no external financing of any kind.
Internal growth rate = ROA x b / 1 – ROA x b
The sustainable growth rate (SGR) is the maximum rate of growth that a
company or social enterprise can sustain without having to finance growth with
additional equity or debt. The SGR involves maximizing sales and revenue growth
without increasing financial leverage.
SGR=Return on Equity × (1−Dividend Payout Ratio)
What we have is that a firm’s ability to sustain growth depends explicitly on the
following four factors:

01. Profit margin: An increase in profit margin will increase the firm’s ability to
generate funds internally and thereby increase its sustainable growth.
2. Dividend policy: A decrease in the percentage of net income paid out as
dividends will increase the retention ratio. This increases internally generated
equity and thus increases sustainable growth.
3. Financial policy: An increase in the debt–equity ratio increases the firm’s
financial leverage. Because this makes additional debt financing available, it
increases the sustainable growth rate.
4. Total asset turnover: An increase in the firm’s total asset turnover increases the
sales generated for each dollar in assets.