514030.BO WACC - Weighted Average Cost of Capital

The WACC of Deepak Spinners Ltd (514030.BO) is 13.5%.

The Cost of Equity of Deepak Spinners Ltd (514030.BO) is 16.30%.

The Cost of Debt of Deepak Spinners Ltd (514030.BO) is 7.20%.

	Range	Selected
Cost of equity	14.10% - 18.50%	16.30%
Tax rate	26.00% - 26.50%	26.25%
Cost of debt	7.00% - 7.40%	7.20%
WACC	11.9% - 15.2%	13.5%

WACC

514030.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.87	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.10%	18.50%

Tax rate	26.00%	26.50%
Debt/Equity ratio	0.34	0.34
Cost of debt	7.00%	7.40%

After-tax WACC	11.9%	15.2%


Selected WACC	13.5%

514030.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 514030.BO:

cost_of_equity (16.30%) = 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.