The research in this document delves into the leverage effect on the profitability of listed companies in the Sensex index in India. It examines the relationship between leverage and firm performance using various financial metrics such as return on assets (ROA), Net Profit Margin (NP), and return on capital employed (ROCE). The study analyses data from a sample of companies to determine the impact of leverage on profitability and valuation. Through regression analysis and correlation studies, the findings reveal the significance of leverage on firm performance and valuation, providing insights for investors and decision-makers in the Indian stock market.