DuPont Decomposition
Why does SIGNPOST earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
24.4% = 12.2% × 0.84 × 2.39
Latest: FY2026
Profitability
Net Margin
12.2%
4.7% →12.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.84x
0.80x →0.84x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.39x
2.05x →2.39x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 16.7 pp over 5 years. Driven by net margin improving (4.7% → 12.2%), leverage rising (2.05x → 2.39x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 4.7% | 0.80 | 2.05 | 7.6% |
| FY2023 | ₹0Cr | ₹0Cr | 10.5% | 0.89 | 2.57 | 24.0% |
| FY2024 | ₹0Cr | ₹0Cr | 11.4% | 0.81 | 2.51 | 23.3% |
| FY2025 | ₹0Cr | ₹0Cr | 7.5% | 0.82 | 2.52 | 15.4% |
| FY2026 | ₹0Cr | ₹0Cr | 12.2% | 0.84 | 2.39 | 24.4% |
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.