DuPont Decomposition
Why does SSDL earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
12.0% = 3.7% × 2.20 × 1.47
Latest: FY2026
Profitability
Net Margin
3.7%
2.3% →3.7%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
2.20x
3.19x →2.20x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.47x
13.70x →1.47x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 87.2 pp over 5 years. Driven by net margin improving (2.3% → 3.7%), asset turnover declining (3.19x → 2.20x), leverage falling (13.70x → 1.47x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 2.3% | 3.19 | 13.70 | 99.2% |
| FY2023 | ₹0Cr | ₹0Cr | 3.9% | 3.14 | 5.34 | 64.9% |
| FY2024 | ₹0Cr | ₹0Cr | 4.9% | 2.92 | 3.17 | 45.5% |
| FY2025 | ₹0Cr | ₹0Cr | 5.1% | 2.08 | 1.63 | 17.2% |
| FY2026 | ₹0Cr | ₹0Cr | 3.7% | 2.20 | 1.47 | 12.0% |
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.