DuPont Decomposition
Why does STARPAPER earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
6.0% = 9.4% × 0.53 × 1.21
Latest: FY2025
Profitability
Net Margin
9.4%
11.3% →9.4%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.53x
0.48x →0.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.21x
1.26x →1.21x
Assets funded by equity vs debt
Trend Analysis
ROE stable at ~6%. Driven by net margin declining (11.3% → 9.4%).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 11.3% | 0.48 | 1.26 | 6.8% |
| FY2023 | ₹0Cr | ₹0Cr | 13.6% | 0.66 | 1.23 | 11.1% |
| FY2024 | ₹0Cr | ₹0Cr | 14.4% | 0.56 | 1.22 | 9.9% |
| FY2025 | ₹0Cr | ₹0Cr | 9.4% | 0.53 | 1.21 | 6.0% |
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.