DuPont Decomposition
Why does SPORTKING earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.9% = 4.5% × 1.38 × 1.76
Latest: FY2025
Profitability
Net Margin
4.5%
19.5% →4.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.38x
1.35x →1.38x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.76x
2.03x →1.76x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 42.5 pp over 4 years. Driven by net margin declining (19.5% → 4.5%), leverage falling (2.03x → 1.76x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 19.5% | 1.35 | 2.03 | 53.3% |
| FY2023 | ₹0Cr | ₹0Cr | 5.8% | 0.34 | 1.75 | 3.4% |
| FY2024 | ₹0Cr | ₹0Cr | 3.7% | 0.31 | 2.18 | 2.5% |
| FY2025 | ₹0Cr | ₹0Cr | 4.5% | 1.38 | 1.76 | 10.9% |
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.