DuPont Decomposition
Why does SOMICONVEY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.2% = 5.4% × 0.83 × 1.59
Latest: FY2025
Profitability
Net Margin
5.4%
3.0% →5.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.83x
0.53x →0.83x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.59x
1.67x →1.59x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 4.5 pp over 4 years. Driven by net margin improving (3.0% → 5.4%), asset turnover improving (0.53x → 0.83x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 3.0% | 0.53 | 1.67 | 2.7% |
| FY2023 | ₹0Cr | ₹0Cr | 3.7% | 0.91 | 1.55 | 5.2% |
| FY2024 | ₹0Cr | ₹0Cr | 4.5% | 0.92 | 1.55 | 6.4% |
| FY2025 | ₹0Cr | ₹0Cr | 5.4% | 0.83 | 1.59 | 7.2% |
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.