524542.BO WACC - Weighted Average Cost of Capital

The WACC of Sukhjit Starch and Chemicals Ltd (524542.BO) is 12.5%.

The Cost of Equity of Sukhjit Starch and Chemicals Ltd (524542.BO) is 15.25%.

The Cost of Debt of Sukhjit Starch and Chemicals Ltd (524542.BO) is 9.15%.

	Range	Selected
Cost of equity	13.70% - 16.80%	15.25%
Tax rate	27.50% - 31.80%	29.65%
Cost of debt	8.30% - 10.00%	9.15%
WACC	11.3% - 13.7%	12.5%

WACC

524542.BO WACC calculation

Category	Low	High

Long-term bond rate	7.3%	7.8%
Equity market risk premium	6.9%	7.9%
Adjusted beta	0.93	1.07

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.70%	16.80%

Tax rate	27.50%	31.80%
Debt/Equity ratio	0.44	0.44
Cost of debt	8.30%	10.00%

After-tax WACC	11.3%	13.7%


Selected WACC	12.5%

524542.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 524542.BO:

cost_of_equity (15.25%) = risk_free_rate (7.55%) + equity_risk_premium (7.40%) * adjusted_beta (0.93) + 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.