520075.BO WACC - Weighted Average Cost of Capital

The WACC of Samkrg Pistons and Rings Ltd (520075.BO) is 15.5%.

The Cost of Equity of Samkrg Pistons and Rings Ltd (520075.BO) is 17.20%.

The Cost of Debt of Samkrg Pistons and Rings Ltd (520075.BO) is 16.90%.

	Range	Selected
Cost of equity	15.90% - 18.50%	17.20%
Tax rate	27.00% - 27.80%	27.40%
Cost of debt	10.00% - 23.80%	16.90%
WACC	13.0% - 18.1%	15.5%

WACC

520075.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.09	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.90%	18.50%

Tax rate	27.00%	27.80%
Debt/Equity ratio	0.53	0.53
Cost of debt	10.00%	23.80%

After-tax WACC	13.0%	18.1%


Selected WACC	15.5%

520075.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 520075.BO:

cost_of_equity (17.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.09) + 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.