DuPont Decomposition
Why does SHIVAMAUTO earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-152.6% = -11.2% × 0.83 × 16.38
Latest: FY2025
Profitability
Net Margin
-11.2%
-9.6% →-11.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.83x
0.18x →0.83x
Revenue per ₹ of assets
Leverage
Equity Multiplier
16.38x
6.27x →16.38x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 142.0 pp over 3 years. Driven by net margin declining (-9.6% → -11.2%), asset turnover improving (0.18x → 0.83x), leverage rising (6.27x → 16.38x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹-0Cr | -9.6% | 0.18 | 6.27 | -10.6% |
| FY2024 | ₹0Cr | ₹-0Cr | -6.3% | 0.22 | 10.16 | -14.1% |
| FY2025 | ₹0Cr | ₹-0Cr | -11.2% | 0.83 | 16.38 | -152.6% |
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.