KaroDesk

ROI Calculator

Measure whether an investment actually paid off. Enter what you put in and what it is worth now, and optionally the holding period to get the annualised return.

Use it for equipment purchases, ad campaigns, shop renovations or any business spend you can attach a return to.

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₹
₹
yrs

Optional — needed only for the annualised return.

Return on investment

Amount invested
₹5,00,000.00
Net gain
₹2,25,000.00
ROI
45%
Annualised return (CAGR)
13.19%
ROI = (final value − investment) ÷ investment × 100.

Formula

ROI% = (Final value − Investment) ÷ Investment × 100

CAGR% = ((Final value ÷ Investment)^(1 ÷ Years) − 1) × 100

ROI ignores time. Always check the annualised figure before comparing two investments of different lengths.

Worked example

₹5,00,000 invested and worth ₹7,25,000 after 3 years is a 45% ROI and about 13.2% annualised.

How to use this calculator

  1. 1Enter the amount you invested and the value it grew to.
  2. 2Enter the holding period in years.
  3. 3Read the total return percentage and the annualised return (CAGR).

When businesses use it

  • Comparing money put into new machinery against money left in a deposit.
  • Judging whether an ad campaign returned more than it cost.
  • Reviewing a business investment after three or five years.

Judging whether an investment earned its keep

Return on investment expresses the gain as a percentage of what you put in, which makes very different spends comparable — a delivery vehicle, a shop renovation and an advertising campaign can all be judged on the same scale. The discipline is in defining the two inputs honestly: the investment should include installation, training and downtime, and the final value should be the incremental benefit the spend produced, not total revenue.

ROI ignores time, and that is its biggest weakness. A 45% return earned in one year is excellent; the same 45% over five years is barely better than a fixed deposit. Annualising the figure to a compound yearly rate is what makes two investments of different lengths genuinely comparable, which is why the annualised return sits next to the headline number here.

Compare the result against your cost of capital rather than against zero. If working capital costs you 11% a year, any investment returning less than 11% annualised is destroying value even though it shows a positive ROI, and the money would do more sitting against the overdraft.

Getting the inputs right

  • Include setup, training and lost production time in the investment figure.
  • Use incremental gross profit generated, not gross revenue, as the return.
  • Judge marketing spend over the full customer lifetime, not the first order.
  • Benchmark against your loan rate or overdraft rate, not against nothing.

Learn the maths behind it

  • How to calculate EMI

    EMI = P × r × (1+r)^n ÷ ((1+r)^n − 1), where r is the monthly rate and n the number of months.

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Calculations happen instantly in your browser. Your calculator inputs aren't sent to our servers. KaroDesk provides calculations and information for general informational purposes. Results should be verified against applicable laws, official notifications, employer policies, lender terms, or professional advice where appropriate. Read our full disclaimer.