DuPont Decomposition
Why does SOMATEX earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
43.9% = 730.1% × 0.06 × 1.02
Latest: FY2025
Profitability
Net Margin
730.1%
3453.4% →730.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.06x
0.06x →0.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.02x
1.16x →1.02x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 176.3 pp over 3 years. Driven by net margin declining (3453.4% → 730.1%).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3453.4% | 0.06 | 1.16 | 220.2% |
| FY2024 | ₹0Cr | ₹0Cr | 368.3% | 0.05 | 1.26 | 23.8% |
| FY2025 | ₹0Cr | ₹0Cr | 730.1% | 0.06 | 1.02 | 43.9% |
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.