Return on Equity (ROE) is a financial ratio that measures the profitability and efficiency of a company in generating returns for its shareholders' investments. This abstract explores the concept of Return on Equity, its calculation, significance, and factors that influence it. It highlights ROE as a key metric for evaluating a company's financial performance and assessing its ability to generate profits from shareholder equity. Additionally, it discusses the implications of ROE for investors, management, and stakeholders in making informed decisions. Return on Equity is calculated by dividing net income by average shareholder equity, expressed as a percentage. It represents the return earned by shareholders on their invested capital. A higher ROE generally indicates better profitability and efficient use of shareholder funds, while a lower ROE may suggest lower profitability or inefficient capital allocation.
Assets, Debt, Equity, Financial Performance, Financial Ratios, Net Income.
[Dr. Lakshmi Prasanna Pagadala (2022) A Review Study of Equity Return] (ISSN 2347 - 5552). www.ijircst.org
Dr. Lakshmi Prasanna Pagadala
Associate Professor, Master In Business Administration (General Management), Presidency University, Bangalore, India,
Email Id:- lakshmi.prasanna@presidencyuniversity.in
