513536.BO WACC - Weighted Average Cost of Capital
The WACC of Gujarat Natural Resources Ltd (513536.BO) is 11.5%.
| Range | Selected | |
| Cost of equity | 10.1% - 13.1% | 11.6% |
| Tax rate | 7.7% - 8.8% | 8.25% |
| Cost of debt | 7.0% - 7.5% | 7.25% |
| WACC | 10.0% - 13.0% | 11.5% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.39 | 0.56 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.1% | 13.1% |
| Tax rate | 7.7% | 8.8% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 7.0% | 7.5% |
| After-tax WACC | 10.0% | 13.0% |
| Selected WACC | 11.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 513536.BO | Gujarat Natural Resources Ltd | 0.02 | 0.23 | 0.23 |
| HINDOILEXP.NS | Hindustan Oil Exploration Company Ltd | 0.08 | 1.32 | 1.23 |
| HPR.AX | High Peak Royalties Ltd | 0.09 | -0.31 | -0.29 |
| LIO.AX | Lion Energy Ltd | 0.43 | 0.38 | 0.28 |
| MEL.AX | Metgasco Ltd | 0.45 | -0.18 | -0.13 |
| OIL.NS | Oil India Ltd | 0.33 | 1.34 | 1.03 |
| SAN.AX | Sagalio Energy Ltd | 0 | -1.99 | -1.99 |
| SELAN.NS | Selan Exploration Technology Ltd | 0.01 | 1.64 | 1.63 |
| TDO.AX | 3D Oil Ltd | 0 | 0.43 | 0.43 |
| WEL.AX | Winchester Energy Ltd | 0.09 | -1.66 | -1.53 |
| Low | High | |
| Unlevered beta | 0.09 | 0.34 |
| Relevered beta | 0.09 | 0.34 |
| Adjusted relevered beta | 0.39 | 0.56 |
513536.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 513536.BO:
cost_of_equity (11.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.39) + 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.