How this calculator works
NPV tells you how much value a project adds in today’s money at your required return. IRR is the return the project itself earns. Payback shows how long until you get your money back.
Type the cash flows year by year into the grid. Leave later years blank if the project is shorter.
Formula
Worked example
A ₹20 lakh machine that brings ₹4.5, 5.5, 6.5, 7 and 7 lakh over five years has an NPV of about ₹1.45 lakh at 12% and an IRR of 14.7%. It pays back in three and a half years.
Things to watch
- Use cash flows after tax, not accounting profit.
- Include any working capital the project ties up as an outflow in year 1 and an inflow at the end.
- When two projects disagree on NPV and IRR, trust NPV.
Questions
What discount rate should I use?
Your cost of capital: the blended cost of your loans and the return your equity investors expect.
Why can IRR be missing?
If cash flows never turn positive, or change sign several times, there may be no single IRR.
What is discounted payback?
Payback using discounted cash flows. It is always longer than simple payback.
Is a positive NPV enough?
It means the project beats your required return. Also check risk, funding and payback.
For planning and education only, not tax, legal or investment advice. Last reviewed 2026-10-31.