DuPont Decomposition
Why does SARLAPOLY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.7% = 15.0% × 0.55 × 1.54
Latest: FY2025
Profitability
Net Margin
15.0%
0.0% →15.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.55x
0.12x →0.55x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.54x
1.47x →1.54x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 12.7 pp over 3 years. Driven by net margin improving (0.0% → 15.0%), asset turnover improving (0.12x → 0.55x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 0.0% | 0.12 | 1.47 | 0.0% |
| FY2024 | ₹0Cr | ₹0Cr | 10.8% | 0.16 | 1.52 | 2.7% |
| FY2025 | ₹0Cr | ₹0Cr | 15.0% | 0.55 | 1.54 | 12.7% |
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.