CAGR Calculator India for Annual Growth Rate

What is CAGR?

CAGR means compound annual growth rate. It answers a simple investment question: if your investment grew from one value to another over a period of time, what steady yearly return would explain that growth? This makes CAGR one of the most useful return measures for investors comparing stocks, mutual funds, gold, real estate, business revenue, or any asset that compounds over more than one year.

A CAGR calculator is especially helpful because absolute return can look impressive without telling you how much time was needed. A 100% gain over two years is very different from a 100% gain over ten years. CAGR normalizes the result into an annual rate, so comparisons become easier and more honest.

CAGR Formula

CAGR = ((Ending Value / Beginning Value)^(1 / Years) - 1) x 100

Beginning value is the amount invested, ending value is the final value, and years is the holding period. The formula assumes annual compounding and does not include taxes, fees, exit loads, or interim cash flows.

CAGR vs Absolute Return

Absolute return shows total gain or loss for the full period. CAGR shows the annualized rate of that gain or loss. Use absolute return when you want to know total profit. Use CAGR when you want to compare performance across different holding periods.

CAGR vs XIRR

CAGR works best for one starting value and one ending value. XIRR works better when you invest or withdraw money on different dates. For example, a lumpsum mutual fund investment can be evaluated with CAGR, while a SIP should usually be evaluated with XIRR because each installment has a different investment date.

CAGR for Mutual Funds and Stocks

Mutual fund factsheets and stock screeners often show three-year, five-year, and ten-year CAGR. These numbers help investors compare long-term performance, but they are not guarantees. Market returns can be uneven, and a smooth CAGR may hide volatile years. Use CAGR with risk metrics, rolling returns, drawdown, portfolio quality, and your own goal timeline.

Worked Example

Suppose you invested INR 1,00,000 and the value became INR 2,50,000 after 5 years. CAGR is calculated as ((2,50,000 / 1,00,000)^(1 / 5) - 1) x 100, which is about 20.11% per year. The absolute return is INR 1,50,000, but the CAGR tells you the annualized pace of growth.

How to Use This CAGR Calculator

• Enter the initial investment or beginning value.
• Enter the final value after the investment period.
• Enter duration in years and review CAGR, absolute return, and total growth.
• Use the growth table to understand the smooth annual path implied by CAGR.