503092.BO WACC - Weighted Average Cost of Capital

The WACC of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 9.7%.

The Cost of Equity of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 12.40%.

The Cost of Debt of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 11.85%.

	Range	Selected
Cost of equity	11.20% - 13.60%	12.40%
Tax rate	25.00% - 36.40%	30.70%
Cost of debt	8.30% - 15.40%	11.85%
WACC	8.2% - 11.3%	9.7%

WACC

503092.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.52	0.61

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	13.60%

Tax rate	25.00%	36.40%
Debt/Equity ratio	1.51	1.51
Cost of debt	8.30%	15.40%

After-tax WACC	8.2%	11.3%


Selected WACC	9.7%

503092.BO's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for 503092.BO:

cost_of_equity (12.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.52) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.