Full formBusiness & Corporate
PATstands forProfit After Tax
Full Form of PAT
What is PAT?
Profit After Tax (PAT) is a key financial metric that represents the actual profit a company earns after deducting all expenses, including taxes, from its total revenue. It is often referred to as net profit or net income and is a crucial indicator of a company's financial health and operational efficiency. In the Indian context, PAT is widely used in corporate financial statements, stock market analyses, and investor reports. Companies listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) report their PAT quarterly, and analysts use it to evaluate profitability trends. PAT is also a determinant for calculating earnings per share (EPS) and dividends. For students appearing for exams like CA, CFA, or MBA finance, understanding PAT is essential for ratios such as net profit margin. The figure is arrived at by subtracting interest, depreciation, amortization, and tax from operating profit. A rising PAT over successive periods signals growth, while a falling PAT may indicate cost pressures or declining sales. In summary, PAT is the bottom-line profit that shareholders and management focus on to assess business performance.
PAT का फुल फॉर्म
कर पश्चात लाभ
Example
The company's board declared a 15% increase in dividend after reporting a strong PAT of ₹500 crore for the third quarter.
PAT — frequently asked questions
What is the full form of PAT?
PAT stands for Profit After Tax, which is the net income of a company after all taxes and expenses are deducted.
How is PAT calculated in Indian companies?
PAT is calculated by taking the operating profit (PBT), then subtracting taxes paid. It is reported in the profit and loss statement of a company.
What is the difference between PAT and PBT?
PBT is Profit Before Tax, while PAT is after tax deduction. The difference is the tax expense paid by the company.