Interest Coverage Ratio Calculator

Calculate how many times a company can cover its interest expense from operating earnings (EBIT).

Inputs

Revenue (Net Sales)

₹

Cost of Goods Sold

₹

Operating Expenses (SG&A)

₹

Depreciation

₹

Amortisation

₹

Interest Expense

₹

Tax Rate (%)

Gross Profit₹ 50,00,000

EBITDA₹ 30,00,000

EBIT (Operating Profit)₹ 24,00,000

Interest Expense₹ 6,00,000

EBT₹ 18,00,000

Net Income (after tax)₹ 13,50,000

Interest Coverage Ratio (EBIT / Interest)4.00x

EBITDA Coverage (EBITDA / Interest)5.00x

InterpretationComfortable — healthy interest coverage

ICR = EBIT ÷ Interest Expense

Lenders typically require ICR ≥ 1.5–2x. Below 1x means earnings cannot service interest.

EBITDA coverage is a softer metric used in leveraged finance (includes D&A add-back).