DuPont Decomposition
Why does SULA earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.4% = 4.6% × 0.51 × 1.87
Latest: FY2026
Profitability
Net Margin
4.6%
12.3% →4.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.51x
0.56x →0.51x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.87x
1.92x →1.87x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 8.8 pp over 5 years. Driven by net margin declining (12.3% → 4.6%).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 12.3% | 0.56 | 1.92 | 13.2% |
| FY2023 | ₹0Cr | ₹0Cr | 17.9% | 0.53 | 1.66 | 15.8% |
| FY2024 | ₹0Cr | ₹0Cr | 18.0% | 0.50 | 1.87 | 17.0% |
| FY2025 | ₹0Cr | ₹0Cr | 12.1% | 0.54 | 1.84 | 12.0% |
| FY2026 | ₹0Cr | ₹0Cr | 4.6% | 0.51 | 1.87 | 4.4% |
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.