DuPont Decomposition
Why does SETL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.2% = 10.3% × 0.62 × 1.59
Latest: FY2026
Profitability
Net Margin
10.3%
10.5% →10.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.62x
0.80x →0.62x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.59x
4.32x →1.59x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 26.3 pp over 5 years. Driven by asset turnover declining (0.80x → 0.62x), leverage falling (4.32x → 1.59x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 10.5% | 0.80 | 4.32 | 36.5% |
| FY2023 | ₹0Cr | ₹0Cr | 10.8% | 1.43 | 2.23 | 34.3% |
| FY2024 | ₹0Cr | ₹0Cr | 10.8% | 0.82 | 1.63 | 14.3% |
| FY2025 | ₹0Cr | ₹0Cr | 10.5% | 0.64 | 1.36 | 9.1% |
| FY2026 | ₹0Cr | ₹0Cr | 10.3% | 0.62 | 1.59 | 10.2% |
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.