DuPont Decomposition
Why does SAREGAMA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.9% = 17.5% × 0.56 × 1.32
Latest: FY2025
Profitability
Net Margin
17.5%
19.5% →17.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.56x
0.12x →0.56x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.32x
1.26x →1.32x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 9.9 pp over 3 years. Driven by net margin declining (19.5% → 17.5%), asset turnover improving (0.12x → 0.56x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 19.5% | 0.12 | 1.26 | 3.0% |
| FY2024 | ₹0Cr | ₹0Cr | 20.5% | 0.13 | 1.38 | 3.7% |
| FY2025 | ₹0Cr | ₹0Cr | 17.5% | 0.56 | 1.32 | 12.9% |
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.