509196.BO WACC - Weighted Average Cost of Capital

The WACC of MM Rubber Company Ltd (509196.BO) is 13.0%.

The Cost of Equity of MM Rubber Company Ltd (509196.BO) is 13.90%.

The Cost of Debt of MM Rubber Company Ltd (509196.BO) is 9.90%.

	Range	Selected
Cost of equity	12.30% - 15.50%	13.90%
Tax rate	7.50% - 14.30%	10.90%
Cost of debt	7.00% - 12.80%	9.90%
WACC	11.3% - 14.7%	13.0%

WACC

509196.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.66	0.82

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.30%	15.50%

Tax rate	7.50%	14.30%
Debt/Equity ratio	0.21	0.21
Cost of debt	7.00%	12.80%

After-tax WACC	11.3%	14.7%


Selected WACC	13.0%

509196.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 509196.BO:

cost_of_equity (13.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.66) + 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.