Cash Flow to Equity is the cash a company generates that belongs specifically to shareholders — after paying operating expenses, taxes, interest on debt, and accounting for any new borrowing or debt repayment. It's a narrower, more shareholder-specific cousin of Free Cash Flow. This distinction matters most for companies carrying meaningful debt: a business might generate strong overall cash flow, but if a large chunk of that is required to service debt, the amount actually available to equity holders (you, the shareholder) could be much smaller. CFE is especially relevant for valuing banks and NBFCs, where debt (deposits, borrowings) is a core, deliberate part of the business model rather than a red flag.