DuPont Decomposition
Why does SWSOLAR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
-47.6% = -4.1% × 1.42 × 8.18
Latest: FY2026
Profitability
Net Margin
-4.1%
-7.0% →-4.1%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.42x
0.71x →1.42x
Revenue per ₹ of assets
Leverage
Equity Multiplier
8.18x
4.44x →8.18x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 25.7 pp over 3 years. Driven by net margin improving (-7.0% → -4.1%), asset turnover improving (0.71x → 1.42x), leverage rising (4.44x → 8.18x). High financial leverage (equity multiplier > 4x) amplifies returns but also risk.
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2024 | ₹0Cr | ₹-0Cr | -7.0% | 0.71 | 4.44 | -21.9% |
| FY2025 | ₹0Cr | ₹0Cr | 1.3% | 1.12 | 5.59 | 8.1% |
| FY2026 | ₹0Cr | ₹-0Cr | -4.1% | 1.42 | 8.18 | -47.6% |
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.