The WACC of Welcast Steels Ltd (504988.BO) is 13.2%.
Range | Selected | |
Cost of equity | 14.1% - 19.7% | 16.9% |
Tax rate | 9.6% - 16.2% | 12.9% |
Cost of debt | 7.0% - 15.0% | 11% |
WACC | 10.2% - 16.1% | 13.2% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.87 | 1.27 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 14.1% | 19.7% |
Tax rate | 9.6% | 16.2% |
Debt/Equity ratio | 1 | 1 |
Cost of debt | 7.0% | 15.0% |
After-tax WACC | 10.2% | 16.1% |
Selected WACC | 13.2% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
504988.BO | Welcast Steels Ltd | 1.05 | 0.79 | 0.4 |
513043.BO | Remi Edelstahl Tubulars Ltd | 0.15 | 0.58 | 0.51 |
513361.BO | India Steel Works Ltd | 0.44 | 1.15 | 0.82 |
513532.BO | Pradeep Metals Ltd | 0.13 | 0.91 | 0.82 |
518075.BO | Suraj Products Ltd | 0.05 | 1.41 | 1.35 |
526981.BO | Shri Bajrang Alloys Ltd | 0.63 | 1.09 | 0.69 |
531638.BO | Suraj Ltd | 0.04 | 0.84 | 0.81 |
531810.BO | Metal Coatings (India) Ltd | 0.03 | 0.05 | 0.05 |
METALFORGE.NS | Metalyst Forgings Ltd | 93.31 | -0.13 | 0 |
SUPREMEENG.NS | Supreme Engineering Ltd | 2.01 | -0.38 | -0.14 |
ZENITHSTL.NS | Zenith Steel Pipes & Industries Ltd | 1.89 | 0.81 | 0.3 |
Low | High | |
Unlevered beta | 0.4 | 0.69 |
Relevered beta | 0.81 | 1.4 |
Adjusted relevered beta | 0.87 | 1.27 |
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 504988.BO:
cost_of_equity (16.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.87) + 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.