IRR Calculator
IRR Formula:
NPV = Σ [ Cash Flow ÷ (1 + IRR)t ] − Initial Investment = 0
Internal Rate of Return (IRR) is one of the most important capital budgeting tools used in finance and investment analysis. IRR represents the discount rate at which the net present value (NPV) of all future cash flows becomes zero.
IRR helps investors and businesses compare different investment opportunities. A project is generally accepted if its IRR is higher than the required rate of return or cost of capital. This makes IRR especially useful when evaluating long-term projects such as factories, startups, infrastructure, or real estate investments.
For example, if you invest ₹1,00,000 in a project that generates ₹30,000 every year for 5 years, the IRR shows the actual annual return earned on your investment after considering the time value of money.
This calculator is widely used by finance professionals, MBA students, analysts, and business owners to evaluate project profitability.
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