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
-2.5% = -3.3% × 0.48 × 1.61
Latest: FY2026
Profitability
Net Margin
-3.3%
11.1% →-3.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.48x
0.68x →0.48x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.61x
1.62x →1.61x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 14.7 pp over 5 years. Driven by net margin declining (11.1% → -3.3%), asset turnover declining (0.68x → 0.48x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.1% | 0.68 | 1.62 | 12.2% |
| FY2023 | ₹0Cr | ₹0Cr | 5.6% | 0.66 | 1.47 | 5.4% |
| FY2024 | ₹0Cr | ₹0Cr | 8.8% | 0.58 | 1.52 | 7.7% |
| FY2025 | ₹0Cr | ₹0Cr | 14.6% | 0.57 | 1.54 | 12.7% |
| FY2026 | ₹0Cr | ₹-0Cr | -3.3% | 0.48 | 1.61 | -2.5% |
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.