Measures the proportion of a company’s debt compared to its shareholders' equity.

What it Measures ?

How much debt we use compared to owner’s money.

Relevant StakeHolders 

CFO, Risk Manager

In-depth Use Case / Real-world Example

Debt-to-Equity Ratio is calculated by dividing total debt by total equity. For example, if a company has ₹500,000 in debt and ₹1,000,000 in equity, the ratio is 0.5. A higher ratio indicates more debt and higher financial leverage, which can increase risk but also potential returns. It’s essential for assessing financial risk and capital structure.