DuPont Decomposition
Why does SENCO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
22.9% = 6.8% × 1.19 × 2.81
Latest: FY2026
Profitability
Net Margin
6.8%
3.7% →6.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.19x
1.68x →1.19x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.81x
2.89x →2.81x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 5.1 pp over 5 years. Driven by net margin improving (3.7% → 6.8%), asset turnover declining (1.68x → 1.19x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.7% | 1.68 | 2.89 | 17.8% |
| FY2023 | ₹0Cr | ₹0Cr | 3.9% | 1.40 | 3.07 | 16.8% |
| FY2024 | ₹0Cr | ₹0Cr | 3.5% | 1.41 | 2.73 | 13.3% |
| FY2025 | ₹0Cr | ₹0Cr | 2.5% | 1.33 | 2.41 | 8.1% |
| FY2026 | ₹0Cr | ₹0Cr | 6.8% | 1.19 | 2.81 | 22.9% |
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.