DuPont Decomposition
Why does STEELCITY earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.3% = 22.9% × 0.26 × 1.72
Latest: FY2026
Profitability
Net Margin
22.9%
21.7% →22.9%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.26x
0.35x →0.26x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.72x
1.73x →1.72x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 2.8 pp over 5 years. Driven by net margin improving (21.7% → 22.9%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 21.7% | 0.35 | 1.73 | 13.2% |
| FY2023 | ₹0Cr | ₹0Cr | 20.5% | 0.30 | 1.64 | 10.1% |
| FY2024 | ₹0Cr | ₹0Cr | 20.1% | 0.28 | 1.77 | 10.0% |
| FY2025 | ₹0Cr | ₹0Cr | 26.3% | 0.31 | 1.65 | 13.2% |
| FY2026 | ₹0Cr | ₹0Cr | 22.9% | 0.26 | 1.72 | 10.3% |
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.