522207.BO WACC - Weighted Average Cost of Capital

The WACC of Rasandik Engineering Industries India Ltd (522207.BO) is 13.8%.

The Cost of Equity of Rasandik Engineering Industries India Ltd (522207.BO) is 19.05%.

The Cost of Debt of Rasandik Engineering Industries India Ltd (522207.BO) is 9.25%.

	Range	Selected
Cost of equity	17.40% - 20.70%	19.05%
Tax rate	24.80% - 27.90%	26.35%
Cost of debt	7.00% - 11.50%	9.25%
WACC	12.2% - 15.5%	13.8%

WACC

522207.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.26	1.38

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.40%	20.70%

Tax rate	24.80%	27.90%
Debt/Equity ratio	0.74	0.74
Cost of debt	7.00%	11.50%

After-tax WACC	12.2%	15.5%


Selected WACC	13.8%

522207.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 522207.BO:

cost_of_equity (19.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.26) + 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.