DuPont Decomposition
Why does SESHAPAPER earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.5% = 6.3% × 0.69 × 1.27
Latest: FY2025
Profitability
Net Margin
6.3%
19.3% →6.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.69x
0.99x →0.69x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.27x
1.27x →1.27x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 18.7 pp over 3 years. Driven by net margin declining (19.3% → 6.3%), asset turnover declining (0.99x → 0.69x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 19.3% | 0.99 | 1.27 | 24.2% |
| FY2024 | ₹0Cr | ₹0Cr | 15.2% | 0.74 | 1.25 | 14.2% |
| FY2025 | ₹0Cr | ₹0Cr | 6.3% | 0.69 | 1.27 | 5.5% |
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.