Quick Answer
CAGR = (Ending value ÷ Starting value)^(1 ÷ Years) − 1. Example: an investment that grows from ₹1,00,000 to ₹2,50,000 in 7 years has a CAGR of 13.99% a year — the steady rate that would turn ₹1 lakh into ₹2.5 lakh over that time. Its total (absolute) growth is 150%, and at that pace money doubles in about 5.3 years.
What is a CAGR Calculator?
A CAGR calculator (CAGR कैलकुलेटर) finds the compound annual growth rate — the single, steady yearly rate that would take a value from where it started to where it ended. Real investments never grow evenly: a stock might rise 30% one year, fall 10% the next and stay flat the year after. CAGR smooths all of that into one number you can compare with an FD rate, an index or another investment.
This free tool works both ways. In Find CAGR mode you enter a starting value, an ending value and the number of years. In Future value mode you enter a starting value and an assumed CAGR to see what it could become. Both modes also show the total growth, the growth multiple and how long the value takes to double.
Key Features
- Two modes: find the CAGR, or project a future value from one.
- Total (absolute) growth in percent.
- Growth multiple — how many times the value multiplied.
- Doubling time at the calculated rate.
- Fractional years such as 2.5 or 0.75.
- Works for anything — stocks, funds, property, gold, revenue, subscribers.
How to Use It
- Choose Find CAGR or Future value from CAGR.
- Enter the starting value — what you invested or the earlier figure.
- Enter the ending value (or the CAGR in future-value mode).
- Enter the number of years between the two.
- Read the result, total growth, multiple and doubling time.
The CAGR Formula
CAGR = (Ending value ÷ Starting value)1/n − 1, where n is the number of years.
Example: you invested ₹1,00,000 seven years ago and it is now worth ₹2,50,000.
- Growth multiple = 2,50,000 ÷ 1,00,000 = 2.5
- 2.51/7 = 1.1399
- CAGR = 1.1399 − 1 = 13.99% a year
The reverse formula is Future value = Start × (1 + CAGR)n. Check: 1,00,000 × 1.13997 ≈ ₹2,50,000.
CAGR Examples
| Start | End | Years | CAGR |
|---|---|---|---|
| ₹1,00,000 | ₹2,00,000 | 5 | 14.87% |
| ₹1,00,000 | ₹2,50,000 | 7 | 13.99% |
| ₹50,000 | ₹1,50,000 | 10 | 11.61% |
| ₹10,00,000 | ₹18,00,000 | 4 | 15.83% |
| ₹2,00,000 | ₹1,60,000 | 3 | −7.17% |
Notice the first two rows: doubling in 5 years (14.87%) beats growing 2.5 times in 7 years (13.99%) on a yearly basis, even though 150% sounds bigger than 100%. That is exactly why CAGR is useful — it puts different time periods on equal footing.
CAGR vs Absolute Return vs Average Return
| Measure | What it tells you | Weakness |
|---|---|---|
| Absolute return | Total growth: (End − Start) ÷ Start | Ignores how long it took |
| Average annual return | Simple average of yearly returns | Ignores compounding; can mislead |
| CAGR | Steady yearly compounded rate | Hides volatility; one deposit only |
| XIRR | Yearly rate with many cash flows on different dates | Needs every date and amount |
Why averages mislead
Suppose ₹100 rises 50% to ₹150 in year one and then falls 50% to ₹75 in year two. The average of +50% and −50% is 0%, suggesting you broke even. In reality you lost a quarter of your money. The CAGR of −13.4% tells the truth. Whenever a fund advertises an "average return", ask for the CAGR instead.
CAGR and SIPs: Use XIRR Instead
CAGR assumes one amount invested at the start and one value at the end. A SIP invests a fresh instalment every month, and each instalment has been invested for a different length of time. Applying CAGR to total invested and final value understates the true return. For SIPs, mutual fund statements and apps report XIRR, which accounts for every date. To project SIP growth, use our SIP Calculator; for a single lump sum, CAGR is exactly right, and our Lumpsum Calculator shows the year-by-year growth.
Using CAGR Beyond Investments
- Business revenue: sales rising from ₹10 lakh to ₹25 lakh over 10 years is a CAGR of about 9.6%.
- Property: a flat bought for ₹40 lakh and valued at ₹70 lakh after 8 years has a CAGR of about 7.25% — its real yearly appreciation — before costs such as stamp duty, maintenance and brokerage.
- Prices and salaries: compare your salary CAGR with inflation to see if your income is really growing. Our Salary Hike Calculator helps with raises.
- Audience growth: YouTube subscribers or website visitors over several years.
Real CAGR: Adjust for Inflation
A 9% CAGR during a period of 6% inflation is a real growth rate of only about 2.8% a year: (1.09 ÷ 1.06) − 1. When judging whether an investment has really built wealth, compare its CAGR with inflation over the same years. Our Inflation Calculator shows how much prices have risen.
Projecting the Future
In Future value mode, ₹1,00,000 at a 12% CAGR becomes about ₹1,76,234 in 5 years, and at 15% for 10 years about ₹4,04,556. These are projections, not promises — a past CAGR does not guarantee the future one. Use a conservative rate when planning, and test a lower rate to see how sensitive your goal is.
CAGR for Periods That Are Not Whole Years
Investments are rarely held for exactly 3 or 5 years. To be precise, convert the holding period into years by dividing the number of days by 365. If ₹1,00,000 became ₹1,30,000 in 900 days, n = 900 ÷ 365 = 2.47 years, and the CAGR is about 11.2%. Enter 2.47 in the years box and the calculator does the rest.
Be careful with very short periods. A 10% gain in six months annualises to a CAGR of 21% — mathematically correct, but it assumes the same pace continues for a full year, which is rarely true. For holdings under a year, the absolute return is often the more honest figure to quote.
Calculating CAGR in Excel or Google Sheets
If you keep your portfolio in a spreadsheet, you can reproduce this calculator's result with a simple formula. With the starting value in cell A2, the ending value in B2 and years in C2, type =(B2/A2)^(1/C2)-1 and format the cell as a percentage. Excel and Google Sheets also have a built-in function, =RRI(C2, A2, B2), which returns the same answer. For investments with many deposits on different dates, use the XIRR function with a column of dates and a column of amounts (deposits negative, final value positive).
Tips for Using CAGR Well
- Use the same period when comparing two investments — 3-year CAGR against 3-year CAGR.
- Watch the start and end dates. A CAGR measured from a market crash looks great; from a peak it looks poor.
- Include dividends in the ending value if they were reinvested, for a fair total-return CAGR.
- Look at volatility too. Two funds with a 12% CAGR can have very different ups and downs.
- Subtract costs and tax for the return you actually keep. Our Capital Gains Calculator estimates the tax on a gain.
Common Mistakes
- Dividing total return by years — 150% ÷ 7 = 21.4% is not the yearly return; the CAGR is 13.99%.
- Using CAGR for SIPs — use XIRR.
- Comparing different periods without noticing.
- Treating a past CAGR as guaranteed.
Who Uses CAGR?
Mutual fund investors compare 3-, 5- and 10-year CAGRs on factsheets; stock investors check a company's revenue and profit CAGR before buying; founders quote revenue CAGR to investors; and students meet the formula in commerce and finance exams. The calculation is the same in every case, so one tool covers them all.
Quick Glossary
- CAGR: compound annual growth rate.
- Absolute return: total percentage growth, ignoring time.
- XIRR: annualised return for many cash flows on different dates.
- Growth multiple: ending value ÷ starting value.
- Real return: return after removing inflation.
Why Use This CAGR Calculator?
CAGR is the most widely used way to describe growth — in fund factsheets, company reports and news headlines — yet the formula involves a fractional power that is awkward on a phone calculator. This tool gives the exact rate instantly, shows the total growth and doubling time alongside it, and lets you flip to a future-value projection with one tap. It is free, needs no sign-up and runs entirely in your browser.
CAGR Calculator — Key Facts
| Formula | CAGR = (End ÷ Start)^(1/n) − 1 |
|---|---|
| Example | ₹1 lakh → ₹2.5 lakh in 7 yrs = 13.99% |
| Reverse | Future value = Start × (1 + CAGR)^n |
| Doubling time | ln 2 ÷ ln(1 + CAGR) |
| Use for | Stocks, funds, property, revenue |
| Not for | Regular SIPs — use XIRR |
Frequently Asked Questions
What is CAGR?
Compound annual growth rate is the steady yearly rate at which a value would have grown from its starting point to its ending point, assuming the growth compounded every year. It smooths out the ups and downs into one comparable number.
What is the CAGR formula?
CAGR = (Ending value ÷ Starting value)^(1 ÷ Number of years) − 1. Multiply by 100 for a percentage. For ₹1 lakh to ₹2.5 lakh in 7 years: 2.5^(1/7) − 1 = 0.1399, or 13.99%.
What is the difference between CAGR and absolute return?
Absolute return is the total growth regardless of time — ₹1 lakh to ₹2.5 lakh is 150%. CAGR spreads that over the years: 150% in 7 years is 13.99% a year. CAGR lets you compare investments held for different periods.
Why is CAGR lower than the average return?
A simple average ignores compounding. If an investment rises 50% and then falls 50%, the average is 0%, but ₹100 becomes ₹75 — a CAGR of −13.4%. CAGR reflects what actually happened to your money.
Can CAGR be negative?
Yes. If the ending value is lower than the starting value, CAGR is negative. ₹2 lakh falling to ₹1.6 lakh over 3 years is a CAGR of about −7.17%.
Should I use CAGR or XIRR for a SIP?
Use XIRR for a SIP or any investment with several deposits or withdrawals on different dates. CAGR assumes one starting amount and one ending amount, so it is right for a lump sum but not for regular instalments.
What is a good CAGR?
It depends on the asset and risk. As a rough reference, Indian bank FDs have recently paid around 6–7.5%, while diversified equity has historically delivered roughly 10–12% over long periods with big swings. A good CAGR beats inflation and suits your risk.
Can I use fractional years?
Yes. Enter 2.5 for two and a half years, or divide days held by 365 for precision.
How do I calculate future value from CAGR?
Switch to Future value mode. It computes Start × (1 + CAGR)^Years. ₹1 lakh at 12% for 5 years becomes about ₹1,76,234.
How is doubling time calculated?
Exactly as ln 2 ÷ ln(1 + CAGR). A quick estimate is 72 ÷ CAGR %, the Rule of 72.
Can I use it for business revenue or users?
Yes. CAGR works for any quantity that changes over time — revenue, profit, subscribers, population or prices. Revenue rising from ₹10 lakh to ₹25 lakh in 10 years is a CAGR of about 9.6%.
Is the CAGR calculator free?
Yes, completely free and private. Calculations run in your browser.
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