Hi Rohan,
there are many things to check...
I would start with Dialog Response times in ST03N. There you can check if the Response times are too high. Additionally u can see the Response times from DB, cpu, ...
With this Information you are able to do detailed checks in the area with large Response times. Normally it's said that response times up to 400ms are very good, up to 1s good and all above bad.
Next Thing to check are the ABAP Buffers via ST02N. The buffer quality should be as high as possible. Massive Swaps should be avoided. U also have to check the Settings for ABAP Memory usage (extenden, heap memory).
Third Thing to check are the database Settings. How many Memory can the database use and how the buffers are used.
Of course you need to check the OS resources too. Best Settings in SAP / DB doesn't help when the OS is swapping or the cpu is nearly 100%.
It's a complex Topic, hope this info will help.
Kind regards,
Martin