DuPont Decomposition
Why does SAPPHIRE earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-2.3% = -1.0% × 0.96 × 2.34
Latest: FY2026
Profitability
Net Margin
-1.0%
2.7% →-1.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.96x
0.80x →0.96x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.34x
2.15x →2.34x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 6.9 pp over 5 years. Driven by net margin declining (2.7% → -1.0%), asset turnover improving (0.80x → 0.96x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.7% | 0.80 | 2.15 | 4.6% |
| FY2023 | ₹0Cr | ₹0Cr | 10.3% | 0.87 | 2.07 | 18.6% |
| FY2024 | ₹0Cr | ₹0Cr | 2.0% | 0.91 | 2.12 | 3.9% |
| FY2025 | ₹0Cr | ₹0Cr | 0.7% | 0.95 | 2.18 | 1.4% |
| FY2026 | ₹0Cr | ₹-0Cr | -1.0% | 0.96 | 2.34 | -2.3% |
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.