Scroll Top


    Growth Rates

    What Does Growth Rates?

    The growth rate is the change in percentage of a specific variable within a certain time period. In terms of investments, the growth rate is described as the compounded annual rate of growth of a company along the lines of earnings, revenue, dividends, as well as concepts, such as retail sales and gross domestic product (GDP).

    Basically, the growth rate is a metric that is used to express the annual change in a variable, represented as a percentage. For example, an economy's growth rate is the annual rate change of the country's GDP—increase or decrease. This rate represents the economy's expansion or recession, respectively.

    Further, if the country's income drops for two consecutive quarters, the country is said to be in recession. If the country's income grows for two consecutive quarters, it is said to be expanding.

    Types of Growth Rates

    1. Industry Growth Rate Every industry has its own growth rate and its own unique benchmark against which the specific industry's growth is compared to measure the performance. The technology industry will have a high annual growth rate compared to a mature industry, such as retail. Such benchmarks can be used by companies to check their position relative to that of their peers.

    One way of estimating the future growth rate of an industry is by analysing the historical growth rates. However, this scale is not very reliable because industrial and economic conditions are subject to change and may be cyclical.

    2. Company and Investment Growth Rates The management of a company, investors, and analysts look at the growth rates of the company on a regular basis to assess where the company may stand in future. Generally, factors such as the firm's sales, earnings, and cash flow are analysed.

    However, investors get in deeper to analyse metrics, such as price-to-earnings ratio and book value to assess the company's growth rate. Public companies publish the figures related to earning, revenue, and growth rate in their quarterly earnings report.

    Popular Topics

    Latest Articles

    Clear offers taxation & financial solutions to individuals, businesses, organizations & chartered accountants in India. Clear serves 1.5+ Million happy customers, 20000+ CAs & tax experts & 10000+ businesses across India.

    Efiling Income Tax Returns(ITR) is made easy with Clear platform. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. Further you can also file TDS returns, generate Form-16, use our Tax Calculator software, claim HRA, check refund status and generate rent receipts for Income Tax Filing.

    CAs, experts and businesses can get GST ready with Clear GST software & certification course. Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner. Our Goods & Services Tax course includes tutorial videos, guides and expert assistance to help you in mastering Goods and Services Tax. Clear can also help you in getting your business registered for Goods & Services Tax Law.

    Save taxes with Clear by investing in tax saving mutual funds (ELSS) online. Our experts suggest the best funds and you can get high returns by investing directly or through SIP. Download Black by ClearTax App to file returns from your mobile phone.

    Cleartax is a product by Defmacro Software Pvt. Ltd.

    Company PolicyTerms of use


    ISO 27001

    Data Center


    SSL Certified Site

    128-bit encryption