DuPont Decomposition
Why does SBICARD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.8% = 13.2% × 0.25 × 4.22
Latest: FY2026
Profitability
Net Margin
13.2%
15.1% →13.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.25x
0.31x →0.25x
Revenue per ₹ of assets
Leverage
Equity Multiplier
4.22x
4.47x →4.22x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 7.1 pp over 5 years. Driven by net margin declining (15.1% → 13.2%), leverage falling (4.47x → 4.22x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 15.1% | 0.31 | 4.47 | 20.9% |
| FY2023 | ₹0Cr | ₹0Cr | 21.1% | 0.23 | 4.63 | 23.0% |
| FY2024 | ₹0Cr | ₹0Cr | 18.9% | 0.22 | 4.81 | 19.9% |
| FY2025 | ₹0Cr | ₹0Cr | 12.9% | 0.23 | 4.76 | 13.9% |
| FY2026 | ₹0Cr | ₹0Cr | 13.2% | 0.25 | 4.22 | 13.8% |
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.