DuPont Decomposition
Why does SHIVALIK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.0% = 5.4% × 0.42 × 1.77
Latest: FY2025
Profitability
Net Margin
5.4%
12.4% →5.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.42x
0.42x →0.42x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.77x
1.70x →1.77x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 4.9 pp over 4 years. Driven by net margin declining (12.4% → 5.4%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.4% | 0.42 | 1.70 | 8.9% |
| FY2023 | ₹0Cr | ₹0Cr | 8.9% | 0.40 | 1.86 | 6.7% |
| FY2024 | ₹0Cr | ₹0Cr | 4.7% | 0.39 | 1.78 | 3.3% |
| FY2025 | ₹0Cr | ₹0Cr | 5.4% | 0.42 | 1.77 | 4.0% |
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.