DuPont Decomposition
Why does SAIL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.6% = 3.0% × 0.82 × 2.25
Latest: FY2026
Profitability
Net Margin
3.0%
11.9% →3.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.82x
0.86x →0.82x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.25x
2.22x →2.25x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 17.0 pp over 5 years. Driven by net margin declining (11.9% → 3.0%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.9% | 0.86 | 2.22 | 22.6% |
| FY2023 | ₹0Cr | ₹0Cr | 2.1% | 0.80 | 2.38 | 4.0% |
| FY2024 | ₹0Cr | ₹0Cr | 2.9% | 0.74 | 2.46 | 5.4% |
| FY2025 | ₹0Cr | ₹0Cr | 2.3% | 0.75 | 2.32 | 4.0% |
| FY2026 | ₹0Cr | ₹0Cr | 3.0% | 0.82 | 2.25 | 5.6% |
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.