DuPont Decomposition
Why does SKFINDIA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
21.8% = 11.7% × 1.36 × 1.37
Latest: FY2025
Profitability
Net Margin
11.7%
12.4% →11.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.36x
1.33x →1.36x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.37x
1.36x →1.37x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~22%.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 12.4% | 1.33 | 1.36 | 22.4% |
| FY2024 | ₹0Cr | ₹0Cr | 12.3% | 1.23 | 1.36 | 20.6% |
| FY2025 | ₹0Cr | ₹0Cr | 11.7% | 1.36 | 1.37 | 21.8% |
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.