DuPont Decomposition
Why does SPCENET earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.7% = 7.6% × 0.81 × 1.25
Latest: FY2025
Profitability
Net Margin
7.6%
1.7% →7.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.81x
0.81x →0.81x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.25x
1.48x →1.25x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 5.7 pp over 4 years. Driven by net margin improving (1.7% → 7.6%), leverage falling (1.48x → 1.25x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.7% | 0.81 | 1.48 | 2.0% |
| FY2023 | ₹0Cr | ₹0Cr | 1.9% | 1.77 | 1.50 | 4.9% |
| FY2024 | ₹0Cr | ₹0Cr | 8.1% | 1.01 | 1.15 | 9.5% |
| FY2025 | ₹0Cr | ₹0Cr | 7.6% | 0.81 | 1.25 | 7.7% |
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.