DuPont Decomposition
Why does SPMLINFRA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.2% = 6.6% × 0.37 × 2.55
Latest: FY2025
Profitability
Net Margin
6.6%
3.0% →6.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.37x
0.17x →0.37x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.55x
8.15x →2.55x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 2.2 pp over 3 years. Driven by net margin improving (3.0% → 6.6%), asset turnover improving (0.17x → 0.37x), leverage falling (8.15x → 2.55x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 3.0% | 0.17 | 8.15 | 4.0% |
| FY2024 | ₹0Cr | ₹-0Cr | -0.8% | 0.24 | 4.11 | -0.8% |
| FY2025 | ₹0Cr | ₹0Cr | 6.6% | 0.37 | 2.55 | 6.2% |
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.