DuPont Decomposition
Why does STARTECK earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.5% = 31.8% × 0.06 × 2.20
Latest: FY2025
Profitability
Net Margin
31.8%
35.2% →31.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.06x
0.11x →0.06x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.20x
1.66x →2.20x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 1.9 pp over 4 years. Driven by net margin declining (35.2% → 31.8%), leverage rising (1.66x → 2.20x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 35.2% | 0.11 | 1.66 | 6.3% |
| FY2023 | ₹0Cr | ₹0Cr | 77.3% | 0.07 | 2.14 | 12.2% |
| FY2024 | ₹0Cr | ₹0Cr | 43.1% | 0.08 | 2.15 | 7.8% |
| FY2025 | ₹0Cr | ₹0Cr | 31.8% | 0.06 | 2.20 | 4.5% |
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.