526073.BO WACC - Weighted Average Cost of Capital

The WACC of Galaxy Bearings Ltd (526073.BO) is 13.1%.

The Cost of Equity of Galaxy Bearings Ltd (526073.BO) is 13.60%.

The Cost of Debt of Galaxy Bearings Ltd (526073.BO) is 8.20%.

	Range	Selected
Cost of equity	11.20% - 16.00%	13.60%
Tax rate	25.50% - 25.60%	25.55%
Cost of debt	7.50% - 8.90%	8.20%
WACC	10.8% - 15.4%	13.1%

WACC

526073.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	0.88

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	16.00%

Tax rate	25.50%	25.60%
Debt/Equity ratio	0.07	0.07
Cost of debt	7.50%	8.90%

After-tax WACC	10.8%	15.4%


Selected WACC	13.1%

526073.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 526073.BO:

cost_of_equity (13.60%) = 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.