Fill in some text

Why Financial Ratios Matter

Financial ratios simplify complex data from financial statements—revealing profitability, valuation, debt risk, and more. Perfect for beginner investors!

. Price-to-Earnings (P/E) Ratio

Shows what you're paying for ₹1 of earnings of a company. Compare across peers to know if a stock is overvalued or undervalued.

Return on Equity (RoE)

Measures how efficiently a company uses shareholders’ money to generate profit. Higher RoE often signals strong management.

Price-to-Book (P/B) Ratio

Compares market price to net asset value. A P/B below 1 may signal undervaluation — ideal for value investors.

Dividend Yield

Shows the return in dividends relative to stock price. Crucial for income-focused investors seeking steady returns.

Debt-to-Equity (D/E) Ratio

Reveals a company’s debt burden. A high D/E means more risk, while a low ratio shows stronger financial stability.

Arrow

Learn formulas, examples, and strategies to grow your wealth — read or listen to the complete blog now!