DuPont Decomposition
Why does SIEMENS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.9% = 12.1% × 0.87 × 1.51
Latest: FY2026
Profitability
Net Margin
12.1%
9.7% →12.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.87x
0.79x →0.87x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.51x
1.73x →1.51x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.6 pp over 4 years. Driven by net margin improving (9.7% → 12.1%), leverage falling (1.73x → 1.51x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 9.7% | 0.79 | 1.73 | 13.3% |
| FY2024 | ₹0Cr | ₹0Cr | 10.2% | 0.87 | 1.70 | 15.0% |
| FY2025 | ₹0Cr | ₹0Cr | 17.9% | 0.60 | 1.65 | 17.7% |
| FY2026 | ₹0Cr | ₹0Cr | 12.1% | 0.87 | 1.51 | 15.9% |
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.