Concept
1. MoM (month-on-month)
MoM % = This month / Last month − 1
Excel (C3 = this month, C2 = last month): =C3/C2-1 (or =IFERROR(C3/C2-1,"")).
Capstone: October 2025 ₹3,60,09,313 vs September ₹2,47,47,450 → +45.5%. Great news? Not really — October is Diwali. MoM is useful for non-seasonal businesses or for spotting sudden breaks, but in seasonal retail it mostly measures the calendar.
2. YoY (year-on-year)
YoY % = This period / Same period last year − 1
October 2025 vs October 2024 (₹3,05,31,900) → +17.9%. Same season compared with same season — the honest growth number. FY2025-26 vs FY2024-25 → +11.0%.
For a running year, compare YTD with last year's YTD (Module 4): April–September → +9.3%.
3. CAGR (compound annual growth rate)
Average yearly growth over several years, as if it grew at a steady rate:
CAGR = (End value / Start value) ^ (1 / Years) − 1
Excel: =(B5/B2)^(1/3)-1, or =RRI(3, B2, B5).
Example: revenue ₹20 cr (FY2022-23) → ₹29.5 cr (FY2025-26), 3 years → (29.5/20)^(1/3) − 1 = 13.8% per year.
Note: years = number of gaps, not number of values (4 values → 3 years). CAGR hides the path (a crash and recovery look the same as steady growth) — show the yearly numbers too.
4. Run rate
"If we keep going at this pace, the full year will be…":
Annual run rate = Revenue so far / Months so far × 12
April–September 2025: ₹12,68,13,258 over 6 months → run rate ₹25.36 cr. Actual FY2025-26 came in at ₹29.50 cr — because October–November alone brought about a quarter of the year's revenue. Run rate ignores seasonality.
Better: seasonally adjusted forecast — last year's full year × this year's YTD growth: ₹26.57 cr × 1.093 ≈ ₹29.0 cr, much closer.
5. Percentage points vs percent
Margin went from 16.8% to 16.5%: that's a fall of 0.3 percentage points, or −1.8% in relative terms. Say "points" for differences between percentages to avoid confusion.
6. Small-base trap
A product going from 2 units to 8 is "+300%". Always show the absolute numbers next to growth %, and be careful with growth on tiny bases.
7. Quick reference
| Measure | Formula | Best for | Misleads when |
|---|---|---|---|
| MoM | this ÷ last month − 1 | non-seasonal, spotting breaks | seasonal business |
| YoY | this ÷ same period LY − 1 | seasonal business | base year was unusual |
| CAGR | (end ÷ start)^(1/n) − 1 | multi-year trend | path was volatile |
| Run rate | YTD ÷ months × 12 | early-year guide | seasonal business |
Common mistakes
Celebrating October MoM growth. CAGR with the wrong number of years. Run-rate forecasts for seasonal sales. Mixing percent and percentage points.