DuPont Decomposition
Why does SHOPERSTOP earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
3.4% = 0.3% × 0.72 × 18.97
Latest: FY2025
Profitability
Net Margin
0.3%
3.1% →0.3%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.72x
0.81x →0.72x
Revenue per ₹ of assets
Leverage
Equity Multiplier
18.97x
22.34x →18.97x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 52.9 pp over 3 years. Driven by net margin declining (3.1% → 0.2%), leverage falling (22.34x → 18.97x). 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 | 3.1% | 0.81 | 22.34 | 56.3% |
| FY2024 | ₹0Cr | ₹0Cr | 1.9% | 0.76 | 17.56 | 25.6% |
| FY2025 | ₹0Cr | ₹0Cr | 0.3% | 0.72 | 18.97 | 3.4% |
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.