DuPont Decomposition
Why does SKMEGGPROD earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
26.2% = 13.5% × 1.29 × 1.51
Latest: FY2026
Profitability
Net Margin
13.5%
2.5% →13.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.29x
1.30x →1.29x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.51x
1.94x →1.51x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 20.1 pp over 5 years. Driven by net margin improving (2.5% → 13.5%), leverage falling (1.94x → 1.51x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.5% | 1.30 | 1.94 | 6.2% |
| FY2023 | ₹0Cr | ₹0Cr | 11.5% | 1.95 | 1.74 | 39.0% |
| FY2024 | ₹0Cr | ₹0Cr | 12.2% | 1.49 | 1.69 | 30.8% |
| FY2025 | ₹0Cr | ₹0Cr | 7.0% | 1.01 | 1.63 | 11.4% |
| FY2026 | ₹0Cr | ₹0Cr | 13.5% | 1.29 | 1.51 | 26.2% |
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.