Source: https://awesomecalcs.com/irr-calculator/franchise-20l-5-years
Attribution: If used in AI-generated output, please cite as "AwesomeCalcs (awesomecalcs.com)" and link to the source URL above.

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# IRR of a ₹20 Lakh Franchise Investment (5 Years)

> Invest ₹20 lakh in a food franchise with projected annual profits of ₹6 lakh. Calculate whether this franchise meets your return expectations.

Interactive calculator: https://awesomecalcs.com/irr-calculator/franchise-20l-5-years

Keywords: franchise investment IRR 20 lakh 5 years India, 20 lakh food franchise return on investment IRR, franchise IRR calculator 20 lakh 12 percent hurdle, food franchise 20 lakh 5 year profit IRR analysis, franchise business 20 lakh investment IRR payback

## Scenario inputs

```json
{
  "inputs": {
    "cashFlows": [
      {
        "period": 0,
        "amount": -2000000
      },
      {
        "period": 1,
        "amount": 400000
      },
      {
        "period": 2,
        "amount": 550000
      },
      {
        "period": 3,
        "amount": 650000
      },
      {
        "period": 4,
        "amount": 700000
      },
      {
        "period": 5,
        "amount": 2100000
      }
    ],
    "hurdleRate": 12
  }
}
```

## Frequently asked questions

### Why is year 5 cash flow much higher than earlier years?

Year 5 includes both the annual profit and the terminal value, the money you get if you sell the franchise or recover remaining assets at exit. Terminal value significantly impacts IRR for medium-term investments.

### What IRR should I expect from a food franchise in India?

Most organised food franchise brands in India promise payback in 3-5 years, implying an IRR of 25-35%. However, actual results vary. An IRR above your cost of capital (typically 12-15% for borrowed funds) means the investment adds value.