DuPont Decomposition
Why does SHARDACROP earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.2% = 7.0% × 0.91 × 1.89
Latest: FY2025
Profitability
Net Margin
7.0%
13.4% →7.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.91x
0.34x →0.91x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.89x
1.95x →1.89x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 3.3 pp over 3 years. Driven by net margin declining (13.4% → 7.0%), asset turnover improving (0.34x → 0.91x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 13.4% | 0.34 | 1.95 | 8.9% |
| FY2024 | ₹0Cr | ₹0Cr | 15.4% | 0.31 | 1.81 | 8.7% |
| FY2025 | ₹0Cr | ₹0Cr | 7.0% | 0.91 | 1.89 | 12.2% |
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.