The WACC of Birla Precision Technologies Ltd (522105.BO) is 15.0%.
Range | Selected | |
Cost of equity | 13.8% - 17.6% | 15.7% |
Tax rate | 17.3% - 28.9% | 23.1% |
Cost of debt | 10.5% - 15.9% | 13.2% |
WACC | 13.1% - 16.9% | 15.0% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.83 | 1.05 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 13.8% | 17.6% |
Tax rate | 17.3% | 28.9% |
Debt/Equity ratio | 0.14 | 0.14 |
Cost of debt | 10.5% | 15.9% |
After-tax WACC | 13.1% | 16.9% |
Selected WACC | 15.0% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
522105.BO | Birla Precision Technologies Ltd | 0.14 | 1.17 | 1.06 |
505232.BO | Veljan Denison Ltd | 0.01 | 0.47 | 0.46 |
505681.BO | Bimetal Bearings Ltd | 0.04 | 1.09 | 1.07 |
507817.BO | Wires and Fabriks (SA) Ltd | 2.08 | 0.15 | 0.06 |
507998.BO | Simmonds Marshall Ltd | 0.51 | 1.01 | 0.74 |
517514.BO | D & H India Ltd | 0.29 | 0.71 | 0.58 |
522004.BO | Batliboi Ltd | 0.2 | 2.08 | 1.81 |
522101.BO | Kilburn Engineering Ltd | 0.03 | 0.96 | 0.94 |
530431.BO | Ador Fontech Ltd | 0 | 1.03 | 1.03 |
Low | High | |
Unlevered beta | 0.78 | 1.01 |
Relevered beta | 0.75 | 1.07 |
Adjusted relevered beta | 0.83 | 1.05 |
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 522105.BO:
cost_of_equity (15.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.83) + 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.