DuPont Decomposition
Why does TVSSCS earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
5.6% = 1.0% × 1.53 × 3.54
Latest: FY2026
Profitability
Net Margin
1.0%
-0.5% →1.0%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
1.53x
1.60x →1.53x
Revenue per ₹ of assets
Leverage
Equity Multiplier
3.54x
8.11x →3.54x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 12.5 pp over 5 years. Driven by net margin improving (-0.5% → 1.0%), leverage falling (8.11x → 3.54x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹-0Cr | -0.5% | 1.60 | 8.11 | -6.9% |
| FY2023 | ₹0Cr | ₹0Cr | 0.4% | 1.61 | 8.58 | 5.5% |
| FY2024 | ₹0Cr | ₹-0Cr | -1.1% | 1.58 | 3.21 | -5.6% |
| FY2025 | ₹0Cr | ₹-0Cr | -0.1% | 1.74 | 3.20 | -0.8% |
| FY2026 | ₹0Cr | ₹0Cr | 1.0% | 1.53 | 3.54 | 5.6% |
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.