523323.BO
Kovai Medical Center and Hospital Ltd
Price:  
5,311.55 
INR
Volume:  
8,165.00
India | Health Care Providers & Services
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523323.BO WACC - Weighted Average Cost of Capital

The WACC of Kovai Medical Center and Hospital Ltd (523323.BO) is 12.1%.

The Cost of Equity of Kovai Medical Center and Hospital Ltd (523323.BO) is 12.40%.
The Cost of Debt of Kovai Medical Center and Hospital Ltd (523323.BO) is 6.80%.

Range Selected
Cost of equity 11.00% - 13.80% 12.40%
Tax rate 25.70% - 26.10% 25.90%
Cost of debt 6.00% - 7.60% 6.80%
WACC 10.7% - 13.4% 12.1%
WACC

523323.BO WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 0.5 0.64
Additional risk adjustments 0.0% 0.5%
Cost of equity 11.00% 13.80%
Tax rate 25.70% 26.10%
Debt/Equity ratio 0.05 0.05
Cost of debt 6.00% 7.60%
After-tax WACC 10.7% 13.4%
Selected WACC 12.1%

523323.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 523323.BO:

cost_of_equity (12.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.5) + 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.