519457.BO WACC - Weighted Average Cost of Capital

The WACC of Virat Crane Industries Ltd (519457.BO) is 14.3%.

The Cost of Equity of Virat Crane Industries Ltd (519457.BO) is 14.85%.

The Cost of Debt of Virat Crane Industries Ltd (519457.BO) is 6.95%.

	Range	Selected
Cost of equity	13.40% - 16.30%	14.85%
Tax rate	25.90% - 26.30%	26.10%
Cost of debt	6.40% - 7.50%	6.95%
WACC	13.0% - 15.7%	14.3%

WACC

519457.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.79	0.91

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.40%	16.30%

Tax rate	25.90%	26.30%
Debt/Equity ratio	0.06	0.06
Cost of debt	6.40%	7.50%

After-tax WACC	13.0%	15.7%


Selected WACC	14.3%

519457.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 519457.BO:

cost_of_equity (14.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.