511626.BO WACC - Weighted Average Cost of Capital

The WACC of R R Financial Consultants Ltd (511626.BO) is 13.1%.

The Cost of Equity of R R Financial Consultants Ltd (511626.BO) is 13.45%.

The Cost of Debt of R R Financial Consultants Ltd (511626.BO) is 15.50%.

	Range	Selected
Cost of equity	11.60% - 15.30%	13.45%
Tax rate	13.30% - 22.30%	17.80%
Cost of debt	4.10% - 26.90%	15.50%
WACC	9.2% - 17.0%	13.1%

WACC

511626.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.57	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.60%	15.30%

Tax rate	13.30%	22.30%
Debt/Equity ratio	0.44	0.44
Cost of debt	4.10%	26.90%

After-tax WACC	9.2%	17.0%


Selected WACC	13.1%

511626.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 511626.BO:

cost_of_equity (13.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.57) + 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.