DuPont Decomposition
Why does SUPREME earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
1.9% = 15.8% × 0.11 × 1.06
Latest: FY2025
Profitability
Net Margin
15.8%
16.9% →15.8%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.11x
0.52x →0.11x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.06x
1.45x →1.06x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 10.8 pp over 4 years. Driven by net margin declining (16.9% → 15.8%), asset turnover declining (0.52x → 0.11x), leverage falling (1.45x → 1.06x).
Historical Decomposition
Last 4 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 16.9% | 0.52 | 1.45 | 12.6% |
| FY2023 | ₹0Cr | ₹0Cr | 16.3% | 0.12 | 1.12 | 2.2% |
| FY2024 | ₹0Cr | ₹0Cr | 11.0% | 0.12 | 1.07 | 1.4% |
| FY2025 | ₹0Cr | ₹0Cr | 15.8% | 0.11 | 1.06 | 1.9% |
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.