DuPont Decomposition
Why does WSTCSTPAPR earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
4.2% = 3.5% × 0.78 × 1.51
Latest: FY2026
Profitability
Net Margin
3.5%
9.2% →3.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.78x
1.00x →0.78x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.51x
1.98x →1.51x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 14.0 pp over 5 years. Driven by net margin declining (9.2% → 3.5%), asset turnover declining (1.00x → 0.78x), leverage falling (1.98x → 1.51x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 9.2% | 1.00 | 1.98 | 18.2% |
| FY2023 | ₹0Cr | ₹0Cr | 19.3% | 1.17 | 1.62 | 36.5% |
| FY2024 | ₹0Cr | ₹0Cr | 15.7% | 0.86 | 1.58 | 21.4% |
| FY2025 | ₹0Cr | ₹0Cr | 7.7% | 0.74 | 1.58 | 8.9% |
| FY2026 | ₹0Cr | ₹0Cr | 3.5% | 0.78 | 1.51 | 4.2% |
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.