DuPont Decomposition
Why does SBIN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.0% = 21.8% × 0.05 × 13.96
Latest: FY2026
Profitability
Net Margin
21.8%
15.0% →21.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.05x
0.04x →0.05x
Revenue per ₹ of assets
Leverage
Equity Multiplier
13.96x
17.54x →13.96x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.4 pp over 5 years. Driven by net margin improving (15.0% → 21.8%), leverage falling (17.54x → 13.96x). 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 | 15.0% | 0.04 | 17.54 | 11.6% |
| FY2023 | ₹0Cr | ₹0Cr | 20.6% | 0.05 | 16.59 | 15.5% |
| FY2024 | ₹0Cr | ₹0Cr | 20.7% | 0.05 | 16.23 | 16.2% |
| FY2025 | ₹0Cr | ₹0Cr | 22.2% | 0.05 | 15.02 | 15.9% |
| FY2026 | ₹0Cr | ₹0Cr | 21.8% | 0.05 | 13.96 | 14.0% |
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.