Financial StatementsBeginner

Net Profit Margin

PAT margin

Net profit as a percentage of revenue.

Detailed explanation

It shows how much of each rupee of sales finally reaches shareholders.

Formula

Net profit margin = PAT ÷ Revenue × 100

Example

PAT ₹52 cr on revenue ₹500 cr → 10.4%.

Why it matters

Brings together pricing, cost control, debt and tax in one number.

Key points

  • Varies widely by industry.
  • Trend matters more than one year.
  • Affected by interest and tax.

Related terms

PATOperating Margin

More in Financial Statements

Income StatementRevenueCost of Goods SoldGross MarginEBITDAEBIT

Educational content only. Definitions and examples are illustrative and are not investment, tax or legal advice.