EBITDA Margin Calculator
EBITDA = Revenue - COGS - Operating expenses (excluding interest, tax, depreciation). EBITDA margin = EBITDA / Revenue. A Rs 1 crore revenue company with COGS Rs 40 lakh, salaries Rs 25 lakh, marketing Rs 10 lakh, and rent Rs 5 lakh has EBITDA = Rs 1 crore - Rs 80 lakh = Rs 20 lakh, EBITDA margin = 20%.
Profit
₹400
Profit Margin
33.33%
Profit / Selling Price
Markup
50%
Profit / Cost Price
Margin % = (Profit / Selling Price) x 100. Markup % = (Profit / Cost Price) x 100. A 50% markup is only a 33.3% margin.
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Calculated with CalcCrack
Common questions about EBITDA Margin Calculator
Why do investors and acquirers focus on EBITDA instead of net profit?
EBITDA removes accounting choices (depreciation methods, amortization schedules), financing structure (interest), and tax jurisdiction. It shows the raw cash-generating power of the business regardless of how it is financed or where it is incorporated. When valuing a company for acquisition, the acquirer will refinance debt and may move to a lower-tax jurisdiction - so EBITDA better reflects what they are buying.
What is a typical EBITDA multiple for valuing a business in India?
EBITDA multiples in India vary by sector: SaaS/tech: 8-15x. Manufacturing: 5-8x. Retail: 4-8x. Pharma: 10-15x. Financial services: typically P/E based rather than EBITDA. For a Rs 20 lakh EBITDA business, a 7x multiple implies Rs 1.4 crore valuation. Listed companies trade higher; private SMEs often at 3-6x EBITDA.
Is EBITDA the same as operating cash flow?
Not exactly. EBITDA approximates operating cash flow but ignores working capital changes. A business with high receivables growth (customers paying late) can have strong EBITDA but poor actual cash flow. Operating cash flow (from cash flow statement) is more accurate. EBITDA is easier to calculate and compare across companies, which is why it is widely used despite its limitations.