DuPont Decomposition
Why does SHAKTIPUMP earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.1% = 9.6% × 0.88 × 1.79
Latest: FY2026
Profitability
Net Margin
9.6%
5.6% →9.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.88x
1.33x →0.88x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.79x
2.20x →1.79x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.4 pp over 5 years. Driven by net margin improving (5.6% → 9.6%), asset turnover declining (1.33x → 0.88x), leverage falling (2.20x → 1.79x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 5.6% | 1.33 | 2.20 | 16.5% |
| FY2023 | ₹0Cr | ₹0Cr | 2.6% | 1.30 | 1.74 | 5.8% |
| FY2024 | ₹0Cr | ₹0Cr | 10.6% | 0.93 | 1.92 | 18.8% |
| FY2025 | ₹0Cr | ₹0Cr | 16.2% | 1.27 | 1.70 | 35.2% |
| FY2026 | ₹0Cr | ₹0Cr | 9.6% | 0.88 | 1.79 | 15.1% |
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.