DuPont Decomposition
Why does SRTL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
7.1% = 5.2% × 0.88 × 1.56
Latest: FY2026
Profitability
Net Margin
5.2%
1.7% →5.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.88x
1.64x →0.88x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.56x
2.43x →1.56x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~7%. Driven by net margin improving (1.7% → 5.2%), asset turnover declining (1.64x → 0.88x), leverage falling (2.43x → 1.56x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 1.7% | 1.64 | 2.43 | 6.8% |
| FY2023 | ₹0Cr | ₹0Cr | 1.0% | 1.55 | 2.22 | 3.4% |
| FY2024 | ₹0Cr | ₹0Cr | 2.9% | 1.49 | 2.31 | 9.8% |
| FY2025 | ₹0Cr | ₹0Cr | 3.1% | 1.31 | 2.62 | 10.8% |
| FY2026 | ₹0Cr | ₹0Cr | 5.2% | 0.88 | 1.56 | 7.1% |
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.