DuPont analysis splits return on equity, or ROE, into net margin, asset turnover and an equity multiplier, three ratios that multiply back to net income divided by equity. In FY2024, on average balances, Sheng Siong earned 26.74% on owners' equity and ST Engineering 27.38%. That is close, and it is still a gap. The first sat on a multiplier of 1.72 and the second on 6.16, about 3.6 times as large on our sums. This is one year's arithmetic, and it ranks neither company.
Different ratios rebuild nearly the same FY2024 ROE at Sheng Siong and ST Engineering
Inputs come from Sheng Siong's FY2024 annual report, pp.73–74, and ST Engineering's Annual Report 2024, pp.128 and 130–131. Net income and equity are the owners' share, averages are opening plus closing over two, and the ratios are ours.
| FY2024, S$ million | Sheng Siong | ST Engineering |
|---|---|---|
| Revenue | 1,428.716 | 11,275.659 |
| EBIT, or nearest line | 159.681 | 1,076.467 |
| Pre-tax profit (EBT) | 167.950 | 862.685 |
| Net income, owners | 137.522 | 702.256 |
| Average total assets | 882.667 | 15,800.100 |
| Average owners' equity | 514.349 | 2,564.857 |
| Net margin | 9.63% | 6.23% |
| Asset turnover | 1.619× | 0.714× |
| Equity multiplier | 1.716× | 6.160× |
| ROE | 26.74% | 27.38% |
We picked this pair because its FY2024 results landed close, and that did not carry into the next year. For FY2025 the same method gives Sheng Siong 26.62% (FY2025 report, pp.73–74) and ST Engineering 17.65% on reported profit (Annual Report 2025, pp.125, 129).
The multiplier is assets divided by equity, so it counts every liability and should never be read as borrowing. Sheng Siong's FY2024 balance sheet (p.73) has no borrowings line; its liabilities are leases, payables, provisions and tax. ST Engineering's FY2024 borrowings were S$5,821.536m of S$13,270.452m in total liabilities (pp.130–131), or 43.9% on our arithmetic. Its 6.16× uses owners' equity. On total equity of S$2,851.592m, the average including minorities, the multiplier is 5.54× and ROE on total profit is 25.57%.
Margin, turnover and the equity multiplier reproduce net income over equity
The three-step formula is ROE = (net income ÷ revenue) × (revenue ÷ assets) × (assets ÷ equity). Revenue and assets cancel, leaving net income over equity. The split doesn't create a new number; it just shows where the existing one comes from.
The five-step version divides net margin further: (net income ÷ EBT) × (EBT ÷ EBIT) × (EBIT ÷ revenue), then turnover and the multiplier as before. Those first three are the tax burden, the interest burden and the operating margin.
Enter either column of the table into our DuPont analysis calculator and it returns the ROE shown. Until 2 November 2026 its written reading checked the multiplier only below an 8% operating margin, so at higher margins it could say a return was not leaning on borrowed money, whatever the multiplier. It gave that reading on a loss too, and it refused a three-step answer when EBIT was blank. The ROE itself was unaffected. The revision made that day checks the multiplier first, stops treating it as debt, accepts a blank EBIT and takes optional opening balances. We use its numbers here and leave its written readings off every named company.
The 1914 record recovers return on investment alone
The Hagley Museum and Library says that "As the Assistant Treasurer in 1914", Donaldson Brown "developed a formula for monitoring business performance", combining earnings, working capital and investment in plant and property into what he termed return on investment. The abstract of a 2013 Accounting Historians Journal paper gives the same year.
That record stops at return on investment. We found no primary source naming who added the equity multiplier or who first wrote the five-step form, and we could not confirm the exact algebra of Brown's formula.
Year-end equity reproduces ST Engineering's published 26.3%
A calculated ROE can miss the annual report simply through the balance used. ST Engineering prints 26.3% for FY2024 in its Annual Report 2025, p.03. Dividing owners' profit by closing owners' equity gives 26.30%. That match is our recomputation; we did not find the company's definition in the pages we read.
| Case | Average | Year-end | Printed by the company |
|---|---|---|---|
| Sheng Siong FY2024 | 26.74% | 25.71% | none in pages read |
| ST Engineering FY2024 | 27.38% | 26.30% | 26.3% |
| ST Engineering FY2025, reported | 17.65% | 17.98% | 18.0% |
| Heineken Malaysia FY2025 | 85.85% | 86.54% | not checked |
| DBS 2025 | 16.26% | 15.97% | 16.2% |
Growing equity puts year-end ROE below the average. Shrinking equity reverses that, as at ST Engineering in FY2025, when owners' equity went from S$2,670.373m to S$2,573.638m (p.129).
Other equity and profit lines can rework the figure further
At FY2024 year-end, ST Engineering's owners' figure gives 26.30%; total profit of S$729.205m over total equity of S$2,950.847m gives 24.71%. That is 1.59 points, against 1.08 from averaging. At Sheng Siong the same choice moves 0.16 points against 1.03.
ST Engineering's FY2025 report prints two figures. Page 03 shows "RETURN ON EQUITY (BOP) 28.7%", with a footnote giving reported return on equity of 18.0%, which is 10.7 points lower. Page 02 gives net profit on BOP of S$850.8m, and dividing that by year-end owners' equity gives 33.1%, so 28.7% rests on some other calculation. We did not find its equity base in the pages we read, and report both as published.
Five steps retrieve a supermarket's net interest income
| Average balances | Tax burden | Interest burden | Operating margin | Turnover | Multiplier | ROE |
|---|---|---|---|---|---|---|
| Sheng Siong FY2025 | 0.832 | 1.022 | 11.20% | 1.565× | 1.787× | 26.62% |
| ST Engineering FY2024 | 0.814 | 0.801 | 9.55% | 0.714× | 6.160× | 27.38% |
| Heineken Malaysia FY2025 (pp.71–72) | 0.756 | 0.983 | 22.09% | 2.135× | 2.450× | 85.85% |
Sheng Siong's FY2025 interest burden sits above 1 because finance income of S$9.171m exceeded finance expense of S$5.329m (p.74), and that expense is mostly lease interest (Note 18, p.101). Its FY2024 inputs above give 1.052.
For Sheng Siong and Heineken Malaysia, EBIT here is "Results from operating activities", the nearest line, so definitions differ. Tax burden on owners' profit also carries minorities: ST Engineering's 0.814 becomes 0.845 on total profit.
Banks rebuild the split without an EBIT line
With no EBIT line, a bank takes only the three-step form. DBS's 2025 statements (pp.112, 114) give total income of S$22,900m, shareholders' profit of S$10,933m, assets of S$897,488m and shareholders' funds of S$68,867m. On those year-end lines, margin is 47.74%, turnover 0.026× and the multiplier 13.03×, for 15.88%.
The printed 16.2% (p.175) uses another basis. It excludes one-time items and a CSR provision, takes profit of S$11,033m less S$35m of dividends on other equity instruments (Note 13, p.132), and leaves those instruments out of equity. That S$10,998m gives 16.26% over a two-point average of ordinary equity and 15.97% over year-end shareholders' funds. The average lands nearer the printed figure without matching it, and the pages we read do not state the bank's method.
All FDIC-insured US institutions held equity of 9.92% of assets at 30 June 2026 (p.10), and in that year's second quarter returned an annualised 1.37% on assets and 13.76% on equity (p.8), a multiple of 10.04 by our division, according to the FDIC's Quarterly Banking Profile.
MAS applied "a single aggregate leverage limit of 50%" to all REITs in its media release of 28 November 2024. That limit uses the regulator's own measure; assets over equity counts every liability and is a different number.
