DuPont Decomposition
Why does SARVESHWAR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
8.8% = 2.4% × 1.25 × 2.98
Latest: FY2025
Profitability
Net Margin
2.4%
0.6% →2.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.25x
1.18x →1.25x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.98x
3.15x →2.98x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 6.8 pp over 4 years. Driven by net margin improving (0.6% → 2.4%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 0.6% | 1.18 | 3.15 | 2.1% |
| FY2023 | ₹0Cr | ₹0Cr | 1.1% | 1.21 | 2.67 | 3.6% |
| FY2024 | ₹0Cr | ₹0Cr | 1.9% | 1.10 | 3.13 | 6.6% |
| FY2025 | ₹0Cr | ₹0Cr | 2.4% | 1.25 | 2.98 | 8.8% |
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.