DuPont Decomposition
Why does SHREECEM earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.2% = 5.9% × 0.67 × 1.32
Latest: FY2025
Profitability
Net Margin
5.9%
10.3% →5.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.67x
0.19x →0.67x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.32x
1.41x →1.32x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.4 pp over 3 years. Driven by net margin declining (10.3% → 5.9%), asset turnover improving (0.19x → 0.67x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.3% | 0.19 | 1.41 | 2.8% |
| FY2024 | ₹0Cr | ₹0Cr | 12.4% | 0.19 | 1.35 | 3.3% |
| FY2025 | ₹0Cr | ₹0Cr | 5.9% | 0.67 | 1.32 | 5.2% |
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.