DuPont Decomposition
Why does SBCL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
19.9% = 16.8% × 0.90 × 1.32
Latest: FY2026
Profitability
Net Margin
16.8%
17.0% →16.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.90x
1.05x →0.90x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.32x
1.61x →1.32x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.9 pp over 5 years. Driven by asset turnover declining (1.05x → 0.90x), leverage falling (1.61x → 1.32x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 17.0% | 1.05 | 1.61 | 28.8% |
| FY2023 | ₹0Cr | ₹0Cr | 16.8% | 1.21 | 1.47 | 29.8% |
| FY2024 | ₹0Cr | ₹0Cr | 16.6% | 1.15 | 1.30 | 24.7% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 1.00 | 1.25 | 19.0% |
| FY2026 | ₹0Cr | ₹0Cr | 16.8% | 0.90 | 1.32 | 19.9% |
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.