DuPont Decomposition
Why does SOLARINDS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
26.7% = 16.4% × 0.89 × 1.82
Latest: FY2025
Profitability
Net Margin
16.4%
12.6% →16.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.89x
0.45x →0.89x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.82x
1.57x →1.82x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 17.7 pp over 3 years. Driven by net margin improving (12.6% → 16.4%), asset turnover improving (0.45x → 0.89x), leverage rising (1.57x → 1.82x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 12.6% | 0.45 | 1.57 | 8.9% |
| FY2024 | ₹0Cr | ₹0Cr | 15.1% | 0.28 | 1.74 | 7.3% |
| FY2025 | ₹0Cr | ₹0Cr | 16.4% | 0.89 | 1.82 | 26.7% |
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.