DuPont Decomposition
Why does SHREERAMA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
13.9% = 10.4% × 1.05 × 1.28
Latest: FY2026
Profitability
Net Margin
10.4%
-3.3% →10.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.05x
1.19x →1.05x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.28x
5.10x →1.28x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 33.9 pp over 5 years. Driven by net margin improving (-3.3% → 10.4%), asset turnover declining (1.19x → 1.05x), leverage falling (5.10x → 1.28x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -3.3% | 1.19 | 5.10 | -20.0% |
| FY2023 | ₹0Cr | ₹0Cr | 2.6% | 1.46 | 4.49 | 17.0% |
| FY2024 | ₹0Cr | ₹0Cr | 5.6% | 1.28 | 1.35 | 9.7% |
| FY2025 | ₹0Cr | ₹0Cr | 24.9% | 0.96 | 1.40 | 33.5% |
| FY2026 | ₹0Cr | ₹0Cr | 10.4% | 1.05 | 1.28 | 13.9% |
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.