524748.BO WACC - Weighted Average Cost of Capital

The WACC of Link Pharmachem Ltd (524748.BO) is 13.2%.

The Cost of Equity of Link Pharmachem Ltd (524748.BO) is 13.05%.

The Cost of Debt of Link Pharmachem Ltd (524748.BO) is 19.25%.

	Range	Selected
Cost of equity	11.30% - 14.80%	13.05%
Tax rate	28.60% - 31.00%	29.80%
Cost of debt	11.60% - 26.90%	19.25%
WACC	10.2% - 16.2%	13.2%

WACC

524748.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.53	0.75

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	14.80%

Tax rate	28.60%	31.00%
Debt/Equity ratio	0.6	0.6
Cost of debt	11.60%	26.90%

After-tax WACC	10.2%	16.2%


Selected WACC	13.2%

524748.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 524748.BO:

cost_of_equity (13.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.53) + 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.