PE Ratio Calculator: Price to Earnings

A PE ratio calculator divides a company's share price by annual earnings per share, or EPS. It shows how much the price represents for each rupee of reported earnings. This form also compares a manually entered industry multiple. Its Fair Value Price is a benchmark scenario, not an independently established value. The growth comparison, PEG, uses a preset assumption, and zero EPS is handled incorrectly, so those outputs and the Recommendation label should not drive a trading decision.

Choose the earnings basis before entering a number

Enter Current Stock Price and Earnings Per Share (EPS) in the same currency and on a consistent per-share basis. Record the date of the share price and the reporting period of the EPS. A share price without a matching earnings basis produces a ratio that is difficult to compare.

Trailing P/E uses reported past earnings. Forward P/E uses an estimate of future earnings. Those are different inputs, even when a screen places the ratios next to each other. This form has a single EPS field, so label the basis in your own notes rather than assuming the tool has looked it up.

Use company-reported results to check whether EPS is basic or diluted, which allows for potential additional shares. Also check whether the accounts are consolidated, covering the company and subsidiaries, or standalone, covering the company alone. Avoid multiplying a single quarter's EPS into an annual figure without stating that assumption. Check exceptional items and changes in share count before interpreting a change in the ratio.

The EPS explanation covers the denominator, while the EPS calculator deals with separate earnings-per-share inputs. Neither supplies this page with company results automatically.

What is a good PE ratio for Indian stocks?

There is no single good PE ratio. A PE of 15 can be cheap for one company and expensive for another. Three comparisons make the number useful. First, compare the stock with companies in the same business, because a bank, a software firm and a steel maker earn and grow in different ways. Second, compare it with the stock's own past PE, using the same earnings basis. Third, compare it with the index PE for context, such as the Nifty 50 PE published by NSE Indices (see the section further down for where to find it).

A high PE means investors pay a lot for each rupee of current profit. That can reflect fast expected growth, or it can reflect a temporary dip in profit that makes the denominator small. A low PE can reflect a cheap price, or it can reflect worries about the business. The ratio does not tell you which one it is, so treat it as a question to investigate and not an answer. This page does not tell you which stocks to buy or sell.

What the industry comparison actually calculates

Industry Average PE (Optional) is a multiple that you enter. The form does not identify a company, peer group or comparison date. A useful note records where the benchmark came from and whether it uses the same earnings convention as the company.

• P/E Ratio: price divided by positive EPS.
• Fair Value Price: entered EPS multiplied by the industry multiple.
• Upside/Downside %: the difference between that scenario price and entered price, relative to entered price.
• Premium to Industry %: the P/E gap relative to the industry multiple.
• Earnings Yield %: for positive EPS, earnings divided by price, expressed as a percentage. Negative EPS instead produces a zero card here. It is not the cash dividend yield.

The tool assigns Valuation Status and Recommendation from fixed thresholds. Those labels do not check the company's debt, cash flow, accounting quality or the suitability of the peer group. A lower multiple alone cannot establish an undervalued share, and a higher one alone cannot establish overvaluation.

PE ratio by sector in India

Typical PE levels differ by sector, and the gap exists for reasons you can check yourself. Businesses with steady profits and little need for new capital tend to be priced at higher multiples than businesses whose profits swing with the economic cycle. Companies in cyclical sectors, such as metals or autos, can show a low PE when profits peak, and a very high one when profits fall. Banks and finance companies are usually read together with price-to-book, covered below, because their balance sheet is the business.

This page does not list sector PE numbers, because they change every day and differ between data providers. To get one, pick a sector index on the NSE Indices site and read its published PE, or compute the median of the PE ratios of a few peers yourself. Then type that figure into the Industry Average PE box, and write down where it came from and the date.

Worked example: ratio and benchmark price

Illustrative inputs: Current Stock Price ₹800, annual EPS ₹40 and Industry Average PE 25. This is an invented company example. P/E is ₹800 ÷ ₹40 = 20 times earnings. Earnings yield is ₹40 ÷ ₹800 × 100 = 5%.

The benchmark-price scenario is ₹40 × 25 = ₹1,000. Relative to the entered price, the gap is (₹1,000 − ₹800) ÷ ₹800 × 100 = 25%. This calculation only asks what price corresponds to that chosen earnings multiple. It does not predict that the price will reach the scenario.

The P/E discount calculation uses a different denominator: (20 − 25) ÷ 25 × 100 = −20%. A 25% scenario price increase and a 20% discount to the benchmark can both be arithmetically correct because their reference bases differ.

For the same example, the PEG card displays about 1.33 because it divides P/E 20 by its preset growth input 15. The form never asks you to enter that growth estimate. This reproduction of the output is not evidence that the invented company, or a real company, grows at the assumed rate.

Trailing PE vs forward PE with a numbers example

Trailing PE divides the price by the EPS of the last four reported quarters. Forward PE divides the price by an analyst or company estimate of the next twelve months. The same share price gives two different ratios. Take a made-up stock at ₹800 with trailing EPS of ₹40 and an estimated forward EPS of ₹50.

Trailing PE uses facts that have been reported, but it looks backwards. Forward PE looks ahead, but it depends on an estimate that can be wrong. Never compare one stock's trailing PE with another stock's forward PE.

Compare the PE of two stocks: a worked example

Use two made-up companies in the same business. Company A trades at ₹1,500 with EPS of ₹50. Company B trades at ₹1,200 with EPS of ₹80.

• Company A: 1,500 ÷ 50 = PE of 30.
• Company B: 1,200 ÷ 80 = PE of 15.
• Company A has the higher PE. Investors pay ₹30 for each ₹1 of its yearly profit, against ₹15 for Company B.
• Earnings yield, the reverse view, is 50 ÷ 1,500 = 3.33% for A and 80 ÷ 1,200 = 6.67% for B.

The higher PE does not mean A is worse or B is better. A might be growing much faster, carry less debt, or have more stable profit. Look at growth next, using PEG.

Zero earnings, missing benchmarks and extra cards

At zero EPS, price divided by earnings has no finite result. The current implementation instead substitutes a positive default EPS and returns a seemingly ordinary ratio. Do not use its result for a zero-earnings company. Negative EPS produces a zero P/E card; that does not mean the company is free or unusually cheap.

Leaving Industry Average PE empty, or entering zero, also invokes a preset multiple rather than skipping the comparison. The field is labelled optional, but its absence does not remove the benchmark-price and valuation outputs. Enter a clearly identified comparison if you want to inspect those cards.

PEG means price-to-earnings relative to growth. Because a growth-rate input is absent here, PEG Assessment is not a company-specific analysis. The implementation contains other internal scenario calculations, but this form's visible output list does not include a forward P/E or Graham Number.

PEG ratio: adjusting PE for growth

PEG divides the PE ratio by the expected yearly earnings growth rate, written as a whole number. PEG = PE ÷ growth rate. Continue the example above, and assume 20% growth for Company A and 8% for Company B. These growth figures are made up.

On PE alone, A looks twice as expensive as B. After adjusting for the assumed growth, A is the lower PEG. That is the point of PEG: it puts growth next to price. The limit is the growth figure, which is an estimate, and different sources give different ones. A very small growth rate also makes PEG explode, so it is useless for companies with falling or near-zero growth. This page's calculator uses a preset growth value rather than your own. For your own growth figure, use the PEG ratio calculator. See also the glossary entries for PE ratio and PEG ratio.

Looking for the current Nifty PE ratio?

This stock-entry form does not retrieve the current Nifty 50 P/E. Use the NSE Indices historical-data and valuation-report page and check the selected index and date. A number copied from a search result can refer to a different observation date.

NSE Indices defines index P/E as adjusted index market capitalisation divided by adjusted gross earnings. It uses trailing 4 quarters of consolidated results, with a standalone fallback when consolidated results are unavailable. The index ratio is not a simple average of the constituent companies' P/E ratios.

The methodology also incorporates losses in aggregate earnings. NSE Indices says it does not compute and publish P/E where the overall index earnings value is negative. That is different from replacing a missing or non-meaningful ratio with zero.

For related measures, the price-to-book calculator compares price with book value, while the fundamental analysis guide provides a broader review structure. Keep these measures separate from a forecast or an instruction to trade.

PE ratio vs PB ratio

The price-to-book ratio (PB) divides the share price by book value per share, which is the accounting value of the company's net assets for each share. PE asks what you pay for profit. PB asks what you pay for assets. PB is the more common choice for banks and finance companies, whose loans and investments are their assets, and for businesses with temporarily negative or very small profit, where PE is not meaningful.

Example with made-up numbers: a share at ₹400 with book value of ₹250 per share has PB = 400 ÷ 250 = 1.6. Use PB with return on equity, which tells you how much profit the assets earn. A PB of 1.6 means something different if the company earns a high return than if it earns a low one.

Where to find EPS for NSE and BSE stocks

EPS comes from the company's own results. Listed companies file them with the stock exchanges. Under Regulation 33 of SEBI's listing regulations, quarterly results are due within 45 days of the quarter's end, except for the last quarter. The last quarter's results go out with the audited annual results, which are due within 60 days of the financial year end. You can find the filing on the company's page on the NSE or BSE site under financial results. It states EPS, usually both basic and diluted, for the quarter and for the year.

To get the annual figure for the calculator, add the last four reported quarters, or take the full-year figure. Do not multiply one quarter by four unless you say so in your notes. Read how to read a company annual report and the EPS calculator for the earnings side.

Keep the comparison date and inputs in the record

When revisiting a ratio, retain the earlier price and earnings inputs instead of replacing them with the newest figures. A changed P/E could reflect a changed price, changed earnings or both. Recording the inputs makes that difference visible without assigning a cause from the ratio alone.

For an industry comparison, note which companies or index the benchmark represents, when it was observed and whether it uses reported or estimated earnings. If that basis is unknown, keep the benchmark-price result as an unverified scenario. The calculator cannot establish the quality of a peer group from its multiple.

P/E questions

Sources

• NSE Indices: company P/E and index earnings methodology.
• NSE Indices: dated valuation-report route.
• Source methodology and calculator behaviour inspected 15 October 2026; no current index valuation is asserted.