505690.BO
Brady And Morris Engineering Co Ltd
Price:  
1,945 
INR
Volume:  
149
India | Machinery

505690.BO WACC - Weighted Average Cost of Capital

The WACC of Brady And Morris Engineering Co Ltd (505690.BO) is 12.4%.

The Cost of Equity of Brady And Morris Engineering Co Ltd (505690.BO) is 12.65%.
The Cost of Debt of Brady And Morris Engineering Co Ltd (505690.BO) is 6.75%.

RangeSelected
Cost of equity11.2% - 14.1%12.65%
Tax rate23.4% - 26.8%25.1%
Cost of debt6.0% - 7.5%6.75%
WACC11.0% - 13.8%12.4%
WACC

505690.BO WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta0.520.67
Additional risk adjustments0.0%0.5%
Cost of equity11.2%14.1%
Tax rate23.4%26.8%
Debt/Equity ratio
0.030.03
Cost of debt6.0%7.5%
After-tax WACC11.0%13.8%
Selected WACC12.4%

505690.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 505690.BO:

cost_of_equity (12.65%) = 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.