Calculate your exact Return on Investment (ROI %), Compound Annual Growth Rate (CAGR %), and inflation-adjusted real purchasing power online.
Investment Details
₹
₹
Yrs
₹
Return Summary
Simple Absolute ROI
+90.0%
Total percentage gain on original invested capital
Net Absolute Gain₹4,50,000
Annualized Return (CAGR)+13.7% p.a.
Inflation-Adjusted Real CAGR (6% Inflation)+7.26% p.a.
Total Cumulative Inflows₹9,50,000
What This Tool Does
The SmartPaisa ROI Calculator computes total return on investment percentage, absolute net profit in rupees, annualized Compound Annual Growth Rate (CAGR), and real inflation-adjusted purchasing power gains across stocks, mutual funds, real estate, and fixed-income assets in India.
It allows Indian investors to look beyond headline percentage gains and evaluate how an asset performed per year against benchmark inflation and capital gains taxes.
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Understanding ROI, CAGR, and Real Inflation-Adjusted Returns
Return on Investment (ROI) is the most fundamental metric in personal finance. It measures the percentage efficiency and total gain of an investment relative to its initial outlay. However, evaluating long-term financial decisions based purely on simple ROI without adjusting for holding duration or Indian inflation can lead to flawed portfolio decisions.
1. Mathematical Formulas: Simple ROI vs Annualized CAGR
While simple ROI represents cumulative total growth, CAGR (Compound Annual Growth Rate) determines the smoothed annual compounding rate over time:
Simple ROI (%) = [ (Final Value + Dividends - Initial Investment) / Initial Investment ] × 100
Suppose an investor allocated ₹5,00,000 into a diversified Indian flexi-cap mutual fund or Nifty 50 index fund, and the portfolio grew to ₹9,50,000 over 5 years:
Net Absolute Profit: ₹9,50,000 - ₹5,00,000 = ₹4,50,000
Annualized CAGR: [(9,50,000 / 5,00,000)^(1/5) - 1] × 100 = +13.70% per annum
Real Return (assuming 6% CPI inflation): [(1 + 0.137) / (1 + 0.06) - 1] × 100 = +7.26% per annum
This reveals that while your capital grew by 90% in nominal rupee terms, your actual purchasing power doubled at an annualized real pace of 7.26% after beating Indian retail inflation.
3. Indian Capital Gains Taxation (FY 2026-27 Rules)
To determine actual net in-pocket cash from investment proceeds, Indian tax rules must be factored into your return expectations:
Listed Equity & Equity Mutual Funds: Long-Term Capital Gains (LTCG) for holdings over 12 months are taxed at 12.5% on gains exceeding ₹1.25 Lakh in a financial year. Short-Term Capital Gains (STCG) are taxed at a flat 20%.
Debt Mutual Funds & Fixed Deposits: Capital gains and interest are added to your total income and taxed at your applicable slab rate (up to 30% + cess).
Real Estate: Properties held for over 24 months qualify for LTCG taxed at 12.5% without indexation (or 20% with indexation for pre-July 2024 properties for resident individuals).
Methodology & Trust Notice: Return calculations use standard financial compounding and Fisher real-rate equations. Review our Calculation Methodology and General Disclaimer.
Frequently Asked Questions
Simple ROI is calculated as: ROI (%) = [ (Final Value + Cumulative Dividends/Income - Initial Investment) / Initial Investment ] × 100. It measures the total percentage gain relative to the original capital invested.
Simple ROI measures absolute percentage gain irrespective of the time horizon. CAGR (Compound Annual Growth Rate) measures the standardized annual compounding rate of return, making it possible to compare investments held across different time periods (e.g. 3 years vs 7 years).
Inflation erodes the purchasing power of your money over time. Real ROI adjusts nominal CAGR using the Fisher equation: Real Rate = [ (1 + Nominal CAGR) / (1 + Inflation Rate) ] - 1. With historical Indian CPI inflation averaging 5.5% to 6%, an investment must generate over 8% CAGR to deliver meaningful wealth creation.
Under revised Union Budget tax rules, Long-Term Capital Gains (LTCG) on listed equity and equity mutual funds held for over 12 months are taxed at 12.5% on annual gains exceeding ₹1.25 Lakh. Short-Term Capital Gains (STCG) on equity held for 12 months or less are taxed at 20%.
For immovable properties held for more than 24 months, LTCG is taxed at a flat rate of 12.5% without indexation for properties acquired after July 2024. For properties acquired prior to July 23, 2024, resident taxpayers can choose between 12.5% without indexation or 20% with cost inflation indexation.
Yes. Enter the total cumulative rental income or dividend payouts in the 'Annual Dividends / Rental Income' field. The calculator incorporates both capital appreciation and cash flow yield into the overall ROI and annualized return.