Net Profit Margin

Net profit margin is a measure of a company’s profitability, calculated as the ratio of net profit (after all expenses and taxes) to total earnings. It indicates the percentage of revenue that remains as profit after all operational and other expenses are deducted. Thus, you may use this figure to assess a company’s efficiency of operations and overall financial stability.

For instance, if a company’s net revenue is ₹10,000 and the net sales are ₹50,000, the net profit margin is 20%.