P/B Ratio Calculator: Price to Book and Benchmark Comparison

This P/B ratio calculator divides Current Stock Price by Book Value Per Share. You can also enter an industry benchmark for a simple comparison. The extra “fair value”, asset-backing and liquidation labels are preset interpretations, not verified valuations. In particular, “Fair P/B (Based on ROE)” repeats the industry benchmark entered here; ROE means return on equity (profit relative to shareholder equity), and the form has no input for it.

P/B compares a market price with an accounting amount

Book equity is assets less liabilities in the accounts. For an ordinary share comparison, use the equity attributable to those shares and a consistent share count. Book Value Per Share divides that amount by the relevant shares outstanding. P/B then divides share price by that book value per share.

The ratio states how much market price corresponds to a unit of recorded equity. It does not establish what assets could be sold for today or what a shareholder would receive in a liquidation. A low ratio is therefore a question to investigate, not a buy signal.

P/B ratio formula in one line

Price to book (P/B) = share price ÷ book value per share. The same ratio can be worked out for the whole company: market capitalisation ÷ total shareholders' equity. Both give the same answer if the share count matches. Market capitalisation is the share price times the number of shares.

Book value per share is the shareholders' equity in the accounts divided by the number of shares. You can read both numbers in the company's balance sheet. Read the book value and P/B ratio glossary pages for the definitions.

Market-to-book ratio: is it the same thing?

Yes, for ordinary share comparisons. Market-to-book and price-to-book mean the same ratio, the market value of the equity compared with its accounting value. Some sources use "market-to-book" for the company-level version and "price-to-book" for the per-share version. The result is the same when the inputs are consistent, so a P/B calculator also answers a market-to-book search.

Use the form’s actual inputs

The calculator has no fields for total equity, share count, return on equity, goodwill or other intangible assets. Calculate or verify the per-share input separately. It also does not fetch an industry average, a company filing or a current quote.

Leaving the optional benchmark blank or entering zero substitutes a preset benchmark in the current calculation. A blank field therefore does not mean “no comparison”. Zero share price or zero book value also falls back to a preset value, so those entries should not be used to analyse a zero-value or unavailable denominator.

Worked example: calculate the multiple first

Illustrative inputs for an unnamed company: share price ₹180, book value per share ₹60 and industry benchmark 2.4. These are invented figures chosen to demonstrate this calculator, not prices or financial results for a listed company.

• P/B = ₹180 ÷ ₹60 = 3.00.
• Premium to the entered benchmark = (3.00 − 2.4) ÷ 2.4 × 100 = 25%.
• Benchmark-equivalent price = ₹60 × 2.4 = ₹144.
• Price difference from the current input = (₹144 − ₹180) ÷ ₹180 × 100 = −20%.

The tool calls ₹144 “Fair Price” and the negative percentage “Upside/Downside”. Read them only as the arithmetic consequences of the benchmark you supplied. There is no evidence here that the market price will move to ₹144 or that the benchmark is appropriate.

For the same fictional company, keeping book value at ₹60 but changing only price to ₹150 gives P/B of ₹150 ÷ ₹60 = 2.50. This is a price scenario; it does not establish a change in asset quality, profits or the accounts.

Where book value per share needs care

• Record whether the figures are standalone or consolidated, and whether the equity belongs to the ordinary shareholders whose price you use.
• Keep units consistent. A total reported in large currency units must be converted consistently with the share count before forming a per-share value.
• Check the report date. The market price may be current while the book-value input comes from an earlier statement.
• Use consistent treatment of preference capital and multiple share classes when comparing companies.

The book-value explanation helps identify the denominator. If a split or another capital change affects the number of shares, ensure the price and per-share amount are on the same basis. A ratio can look different simply because the inputs use incompatible share counts.

Where to find book value per share for an NSE-listed company

Book value per share is not a quoted price. It comes from the company's own accounts, and different sites may calculate it differently. These are the usual places to look.

• The balance sheet in the latest quarterly or annual results the company files with the exchanges. Take total equity attributable to owners and divide by the number of shares.
• The company's annual report, which often prints a book value per share figure in its key figures.
• A data provider's ratio page, if it states its method and the date of the accounts used.

Whichever you use, note the date of the accounts and whether the figures are standalone or consolidated. Combine this with a share price from the same day. A price from today and a book value from months ago can mislead.

Ordinary book value is not tangible book or liquidation value

Tangible book removes relevant intangible amounts from the matching equity base before dividing by shares. The current form does not collect those amounts, so it cannot produce a company-specific tangible-book assessment.

The displayed Liquidation Value uses a preset fraction of the entered book value under the form’s default assumptions. It does not inspect assets, liabilities, recovery costs or creditor claims. Treating that figure as expected sale proceeds or a guaranteed price floor would be misleading.

Book values depend on accounting choices and can be difficult to compare across different businesses. Damodaran’s discussion highlights the problem of negative equity and the limited meaning of asset-based comparisons for some service or technology firms. The accounting measure is not a complete inventory of everything that makes a business valuable.

A peer comparison needs a defined peer set

Write down which companies form the benchmark, whether the reported figure is an average or median, and the dates and statement basis used. Different selections can produce different comparisons. The calculator cannot check that the group represents the company you are examining.

Keep P/B beside earnings, profitability and balance-sheet context. The P/E calculator addresses a different denominator, earnings. Return on equity relates profit to equity. Neither ratio turns a benchmark comparison into a trading instruction.

Avoid universal rules that call a ratio cheap or expensive solely because it crosses a fixed threshold. The Valuation Status and Suitable For cards here use preset rules. Asset Backing is also a rule-based label, not an asset appraisal. They are not personalised recommendations.

What is a good P/B ratio for Indian stocks?

No single P/B is "good" for all stocks. What counts as high or low depends on the business, its profitability and the period. A ratio of 1.0 means the market price equals recorded book value. Above 1.0 means the market values the company at more than its accounts show. Below 1.0 means less.

A P/B below 1 is a question, not an answer. It can mean the market doubts the quality of the assets, expects low profits, or sees risk of losses. It can also mean the market has been too gloomy. It does not prove the shares are cheap, and the accounts may not be recoverable at book value. The reverse is true for a high P/B. It can reflect strong profits on a small asset base, or it can reflect high expectations that go unmet.

Compare a company with its own past P/B and with a defined group of similar companies, and look at profitability alongside. The tool's own labels, such as Valuation Status, are preset readings and not a verdict.

P/B by sector: where it is useful and where it misleads

P/B tells you most when a business's value is tied to its balance sheet. Banks and non-bank lenders hold mostly financial assets and liabilities, and their equity is a close measure of their size, so P/B is widely used for them. Asset-heavy businesses with plants and property can also be compared this way.

It tells you less for businesses whose value sits outside the balance sheet, such as software and consulting firms, brands and platform companies. Their main assets are people, relationships and software, which accounting treats differently or leaves out. Their P/B can be high or can be skewed by buybacks, which shrink equity. Damodaran's discussion of book value multiples makes this point about service and technology firms. Do not compare a bank's P/B with a software company's. See the fundamental analysis guide.

P/B vs P/E: which one to use

Price to earnings (P/E) compares the share price with profit per share. P/B compares it with accounting equity per share. P/E suits businesses that earn steady profits. P/B suits businesses where the balance sheet is the main story, such as lenders, or where profits are temporarily low or negative so P/E breaks down. Many analysts look at both, alongside return on equity. Try the P/E ratio calculator for the earnings side.

P/B and ROE together

Return on equity (ROE) is profit divided by shareholders' equity. It shows how much profit a company makes on its equity. A company that earns a higher return on equity can reasonably trade at a higher P/B than one earning less, because each rupee of equity produces more profit. One textbook relation puts the justified P/B as (ROE − g) ÷ (r − g), where g is the long-run growth rate and r is the return investors require. All three inputs are estimates.

Change one assumption and the answer moves a lot. With r at 13% instead of 12%, the result is 10 ÷ 8 = 1.25. This is why such results are a way to see how P/B and ROE link, and not a fair price. The ROE and ROCE calculator works out the profitability side. The form on this page does not take ROE, so its "Fair P/B" card simply repeats the benchmark you enter.

Zero or negative book value

A zero denominator cannot produce a meaningful ordinary P/B multiple. Negative equity is a separate accounting condition, not a bargain multiple comparable with a positive denominator. This calculator can return a zero ratio for negative book value while other cards still print generic asset labels. Do not interpret those cards as an appraisal.

For either case, return to the statements rather than assigning a positive-book-value comparison. The fundamental analysis guide provides the wider context. No company’s live accounts or market valuation is verified by entering numbers into this form.

P/B calculator FAQ

Sources

• Aswath Damodaran, NYU Stern: Book Value Multiples (checked 15 October 2026).
• US SEC: Beginners’ Guide to Financial Statements (checked 15 October 2026).